If you have travelled to the Republic of Panama on a business trip or on vacation, the natural beauty of the place would not have failed to impress you. I have seen the tourism in Panama grow at a phenomenal rate in the last 5 years. I have also tried to impress on many potential investors that this makes it an excellent investment opportunity for them.
Consider the following figures:-Between January and September 2007 the number of tourists arriving in the Republic of Panama was a record breaking 982, 640. However, between January and September 2008, there were 1,110,000 tourists, a significant increase compared to the numbers the previous year.This only confirms the fact Panama is fast becoming recognized as a wonderful tourist destination ideal for travelers of all ages and interests. Amongst the many nations, the Republic of Panama draws many tourists from Europe, USA, and Canada. The Tourism Authority of Panama (ATP) states that in the period of January to September 2008, there had been an increase of nearly 23.1% in the number of tourists from Europe alone. Tourism today, accounts to close to 10% of the gross domestic product (GDP) of the Republic of Panama and has outdone many of the other industries in the service sector.
The Republic of Panama brought into force Law No. 8 to promote investment not just in Panama but also in Latin America and the Caribbean. To date, this remains one of the most comprehensive, well-formulated and modern laws for promotion of tourism. For example, Law 8 states that in areas that attract a large number of tourists, special zones called Special Tourism Zones be set up where there will be 100% exemption from various taxes and other duties such as real estate tax, income tax, import duties for building and construction materials as well as equipment and many other taxes. Accordingly, the government has identified various picturesque and tourist-friendly spots in different parts of the country and set up Special Tourism Zones that provide multiple tax exemptions and many other tax holidays.
However, this is not the only significant law in the country regarding the development of tourism. Law 58, for example, looks at setting up new regulations and incentives for investors even outside the Special Tourism Zones. For example, the minimum investments have increased to nearly US $3 million in the metropolitan areas of Panama while it has increased to nearly US $50,000 in the rest of the country considered the “interior”.
This is not surprising considering that many of the world’s reputed lodging franchises are rushing to the Republic of Panama to invest in the tourism sector by setting up chains of hotels and lodges. Notable among them are Holiday Inn, Marriott, Radisson, Inter-Continental, Trump Hotels & Resorts, Best Western, Crowne Plaza, Sheraton and Nikki Beach. However, these are not the only avenues for investment. With sufficient government encouragement projects that focus more on ecological conservation as well as on understanding the history of the place are also being undertaken and invested in.
The next time you are in the Republic of Panama for a vacation, I would urge you to explore not just the rich beauty of the place but also the wonderful investment opportunity the tourism sector offers you.