The Panama Entrepreneur Visa

Panama's commerce minister, Roberto Henriquez, this week announced a new loan structure for small Panamanian entrepreneurs. Although I am sure this will be a most welcome capital flow into micro business here in Panama, few Panamanians  have the needed business experience to make a success of a new enterprise that would truly bring innovation and benefit to the country. Yes, they can open more mini supers, kioskos and taxis, but these will do little to help Panama advance into the first world. Here is what the commerce minister has in mind.

"The bank will be the third component of "Proyecto Impulso" ("Stimulus Project"), and will begin operations with $25 million in capital. The announcement was made by Roberto Henríquez, Commerce and Industries minister, who will present his plan to the Executive Cabinet."Henríquez explained that 90% of the country's companies are classified as micro and small. This is why this bank will be focused on granting credit solutions to this sector of the economy", reported Prensa.com.

My fellow blogger, Matt Landau, wrote a post this week that I believe could be a key to Panama's future social and economic well being. He calls it the Panama Entrepreneur Visa and if adopted could bring tremendous talent, ideas and money to the country. Instead of, or in addition to this micro financing plan, how about considering Matt's Entrepreneur Visa? I have posted it here with his permission. You can read more of his work at The Panama Report.

Matt Landau January 3, 2010

I come from a place where some of the biggest, most successful companies were started by immigrants. From Katz's Delicatessen to Google, stories of smart, motivated entrepreneurs who emigrated to the U.S. and found a better life linger around every neighborhood corner. And while American visa laws and immigration agents aren't exactly known for their hospitality, they do shed an interesting light on how cosmo-obsessed Panama has the potential to grow in a truly international way. "Entrepreneurs drive America's economy, accounting for the majority of the nation's new job creation and innovations. Self-employed individuals who have no paid employees operate three-fourths of U.S. businesses. Further, America's 25.8 million small businesses employ more than 50% of the private workforce, generate more than half of the nations GDP, and are the principal source of new jobs in the U.S. economy." - ODEP, U.S. Office of Disability Employment Policy

It's no secret that entrepreneurs and small business owners are, collectively, the driving force of innovation and economic progress in many countries. While everyone is motivated by their own set of private and professional agendas, the common drive is to fill niches then make money. From the first time I visited Panama, there flowed an air of creativity and innovation: this sense that if you picked the right function and you did it well, great success was just around the bend. The infrastructure was growing and Panama appeared to be in search of ideas, innovation, talent, and organization.

But there was (and is) only one little hitch. Ask any entrepreneur nowadays in Panama what the most difficult obstacle is to deal with and the answer is united: immigration. Visionaries like these can usually see through the little hurdles - the red tape, the cultural nuances, the fact that nothing gets done on time - because that's what entrepreneurs do. But for small business owners, immigration in Panama is an extremely hard obstacle to overcome. Not only are visas difficult to obtain for oneself, but the ability to import skilled laborers is virtually impossible.

The potential to make a profit in Panama supplies a huge incentive for entrepreneurs to come up with new and better ideas: thus the giant explosion in new corporations created over the past five years. There is - and will be more and more amidst a recession and tightening immigration policies elsewhere in the world - a mad dash to bring in the world's skilled foreigners. How can Panama position itself most attractively on that competitive buffet of options?

No one can argue that importing educated people to create jobs and build wealth might be bad for the economy. Chile, for instance, is throwing its doors wide open, offering a permanent visa to entrepreneurs, paying them up to $30,000 to visit the country and another $30,000 to start a business. In some cases, the Chilean government will even pay for office rent for the first five years. Read Chile Wants Your Huddled Masses, Your Tech Entrepreneurs.

A potential problem with such a visa in Panama would be the fact that the Republic's government historically hasn't done well with...let's say...turning down bribes which are inevitable to nuanced immigration. This type of backdoor policy could just lead to more people buying their way in, and more corruption. There's also the question of how the government determines who qualifies as a legitimate entrepreneur - not to mention if the visa-acceptee fails miserably in his promising start-up. [Please use the comment section below to submit your suggestions on how Panama's government could qualify entrepreneurs for an entrepreneur visa and what effects this might have on development.]

All the potential downfalls withstanding, the prospect for an entrepreneur visa in Panama is not outlandish. Just as Chileans call their country a "land of immigrants," Panama too is a nation that has historically utilized the aid of foreigners to accomplish monumental tasks. It's now a time for realizing the expertise that exists (and that can be taught) within its borders, then opening doors to bring in the best and the brightest abroad: to continue Panama down its road of economic and development breakthroughery. Entrepreneurship needs to have a place on Panama's immigration agenda: it belongs alongside retirees and pensioners as the very alluring building blocks of a sustainable nation.

See here for a similarly proposed visa in the U.S.