3.2.6.- Panama
The evaluation of the seventeen key aspects to determine the business competitiveness of Panama is given in the table below.
1. Political aspects (3). After the turbulent eighties and the change of control over the Panama Canal in the year 2000, Panama has managed to stabilize its political system.
2. Social aspects (3). Panama’s education system is acceptable to many other Central American countries but still insufficient. Panama looses many opportunities due to the lack of bilingualism.
3. Safety (3). Safety is rather good and there are hardly any internal conflicts. Panama is, together with Nicaragua, regarded to be the safest country in Central America.
4. Economic aspects (3). Since the year 2004, the economy in Panama is on the rise. The decision to widen the Panama Canal has spurred foreign investment tremendously. Not just in the sectors related to the canal, but also the service sector and tourism.
5. Fiscal aspects (3). Panama has a favourable tax climate for all kinds of sectors, as well as for agriculture.
6. Investment capital (3). Although it would be expected to be a strong point for Panama, loans are hard to be obtained as little priority is given to the agricultural sector. The government is actively trying to improve credit lines and besides that, interest rates are acceptable. Altogether it is expected that investment capital will become less of a problem in the near future.
7. Infrastructure (local, 3). Local infrastructure is good, especially on the main connections throughout the country. The biggest problem are the rapidly increasing traffic jams in and around Panama City. Electricity is available in most part of the country.
8. Infrastructure (export, 2). Although Panama is the hub for Latin America, it is hard to find containers with Europe as its destination. Many container carriers do not seem to stop in Panama because there is not enough produce to be picked up. The airport has many international connections but hardly any facilities for perishable cargo freight.
9. Communication (3). Communication is good in Panama and can almost be considered to be very good except for the fact that costs are still rather high.
10. Trade agreements (3). Panama has a large number of trade agreements opening doors to many foreign destinations. The lack of exports in especially the agricultural sector is the reason that Panama has not taken enough benefits so far from its agreements.
11. Climate and natural resources (3). The climate of Panama can be regarded as favourable for many crops, land is available and affordable and water is good and available.
12. Agricultural sector organization (2). The sector is small and organizations taken care of the sectors interest are limited. Most strategic activities and action plans are initiated by the Ministry of Agriculture.
13. Phytosanitary service (2). The phytosanitary service is considered to be good for export related activities and average for import related matters.
14. Agricultural supplies (2). Supply materials are expensive due to the fact that many materials need to be imported or simply can not be obtained through supply companies. Many companies are not equipped to import products themselves.
15. Labour (unskilled, 2). Labour is available in most regions of the country and education is acceptable. Costs are low compared to Costa Rica but rather high compared to most other Central American countries.
16. Labour (management, 2). Management is hard to be found due to the fact that there are not many agricultural businesses where professionals can be trained. The initiative from the Ministry to train graduates in the south of Spain can be considered as a big step forwards.
17. Subsidies (2). Subsidies from foreign organizations or governments are virtually absent. The national government itself does have various programs to stimulate rural development and export oriented agricultural produce.
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