Panama Investor Blog

What will happen in Panama, if China announces it has over 8,000 tons of Gold in 2014?

 Its been almost 5 years since China publicly announced its gold reserve – there are rumors and speculations going around the world wide web that indicate China has been importing such amounts of gold that it actually has more than what the Fed claims to have in its possession.

The last “official” announcement detailing China’s gold holdings was in 2009 – ringing in a total of 1,054 tonnes. Compared to their previous official holding, announced six years prior, the new total represented a dramatic 75% increase in Chinese gold holdings.

Starting at the time of China’s last official announcement, we’d need to add another 2,873 tonnes to China’s “official” holdings, just to account for imports and domestic production alone. That would put China’s current “known” holdings at 3,927 – well above Germany as the second largest gold holding nation in the world.

When you start adding up the stealthy, hard-to-track sources of gold – black market gold from Africa and South America (and maybe Iran) exports, global gold mining from semi-national Chinese firms or buyouts, and the idea that China is urging their own citizens to hoard gold – you’ll notice that China’s gold hoard is closer to 7,000 tonnes, or more!

If China announces anything close to this number of tonnes of gold this year - there are many things that could follow through – most immediatrely would be an hyperinflation of the dollar and this could open the need to print more money in Panama. Why?

It is possible that the new government of Panama elected this year 2014 will have to print more balboas – There are Approximately: 185,000 people working for the governement – costing 180,000,000 per month. The current government already began minting 1.00 Balboa coins, costing literally a quarter of what its valued at currently ($0.25)   – what or who will stop Panama from minting 5.00 and 10.00 balboa coins? 

We could begin to see Panamanians talking more about gold and silver now more than ever before – to level the game for the coming government it seems like making more balboas to be used nationally makes sense if we continue to grow, as we have in the last decade.

With hyperinflation as a current important topic in international relations – We envision more investments towards sustainable biotechnologies to meet with human basic needs in abundance thus creating a sense of security beginning in individual communities – expanding towards a whole national plan.

 

The Panama Colon Container Port is anticipated to open with and Investment value of $900M by the end of 2014

The Panamanian maritime industry represents 20% of the Gross Domestic Product and is the fastest growing sector in the national economy.

Investment resulting from development and privatization of ports exceeds the sum of one billion dollars and continues with its expansion, privatization and concessions plans in the Panamanian port system in both oceans.

The Panama Maritime Authority, an autonomous entity of the Panamanian Government is responsible for approving, registering and authorizing regular and special flagging, either locally or by means of an authorized marine merchant consulate. It promotes domestic and foreign investment, and supports the development of Multimodal Logistics Center with the operation of the Panama-Colon railroad, providing greater operational efficiency to the Colon Free Zone.

During the last 10 years, the evolution of port activities has shown its highest level in growth and development in Panama. In 2010, the Panamanian port system moved 5,593,199 TEUs (container units of 20 feet in length), that is 31.8% compared to same period in 2009.

The Panama Colon Container Port (PCCP) is bringing together international leaders in the fields of maritime engineering, construction and operations, all committed to the construction of a modern and efficient port complex designed to serve present and future demands for transshipment and other maritime services in the Panama Canal Zone.

PCCP will be built to provide for capacity of up to 2 million TEU’s of dynamic throughput with anticipated opening in Fall 2014. Projected investment value greater than $900 million USD.

The Panama Colon Container Port Layout

Panama’s Debt will be above 17 Billion dollars by the end of 2014

Currently Panama's debt is $16,351,900,000 / 3,800,000 citizens = approx $4,300 is owed per citizen  in Panama

Lets compare this to the United States:

$17,152,000,000,000 / 313,000,000 = approx $54,798 is owed per citizen

From a macro financial point of view, it seems like its easier to find “freedom” in Panama than it is in the United States of America – The average Panamanian suffers from less stress compared to the average North American.

Maybe this is why Panama was ranked as one of the happiest countries in the world by www.travelchannel.com

We believe its only going to get better, IF Panama continues to invest in Renewable Energy Sources, perhaps begin using Permaculture designs instead of traditional farming to lower costs of basic food necessities, transportation is very important for those who make minimum wage (approx. half the population)

 

ROBERTO GONZALEZ JIMENEZ

roberto.gonzalez @ prensa.com

The stock of public debt at the end of February totaled $ 16 billion 351.9 million, according to the Directorate of Public Credit of the Ministry of Economy and Finance.

The increase in debt in the past year has been $ 2 billion 107 million, exceeding the total cost of the first Metro line of Panama, including all additions and addenda to the contract.

In the last five years, coinciding with the administration of Ricardo Martinelli, the debt grew $ 5 billion 846 million. And projected by the MEF, the rise will not stop for the rest of the year. According to the governing body of Frank De Lima, at the end of this year the stock of public debt will exceed $ 17 billion 200 million.

In these calculations the commitments made by the government in turnkey projects, payment of which will be finalized by the next administration are not included. This account works like multimillion expansion to four lanes between David-Chiriqui and Santiago de Veraguas, which will cost a total of close to $ 1.100 million and will be paid between 2015 and 2019

Is not considered in the official data the debt incurred by the Tocumen International Airport, the National Highway Company (ENA) and the Electricity Transmission Company (Etesa), since they were excluded from the non-financial public sector in 2011.

The three institutions are making substantial investments beyond the balance sheet. Tocumen, SA is building a new terminal, whose costs of up to $ 936 million; Etesa up a new power transmission line for $ 233 million, and ENA invests more than $ 1.200 million between the purchase and expansion of the North and South corridors.

 

SCHEME DEBT

The external debt stood at $ 12 billion 250.5 million at the end of January, with a marginal increase of $ 3.6 million (0.03%) compared to the previous month.

Public Debt reported that in February, the Cabinet approved the hiring of three new loans with multilateral agencies: $ 100 million for the Metro of Panama (with the Development Bank of Latin America-CAF); another $ 100 million for the expansion and modernization of the educational infrastructure (also with CAF), and $ 300 million (with the Inter-American Development Bank) for "Improving the Stability and Financial Transparency and Tax" program.

Meanwhile, domestic debt closed with a balance of $4.1 Billion and now represents 25.1% of the total.

In February, the total amount of disbursements received was $ 176 million, $ 122.3 million in Treasury notes and $ 54 million in Treasury bills, through public auction in the domestic capital market.

The government aims to further boost the local debt market with new issues.

Distances between a few countries and Panama 

 

Panama is one of the most Economically Stable places where Multinationals can have their Operations.

Panama has played its cards right when it comes to business, because of the enacted tax breaks and broad economic incentives it is becoming an allure for companies looking to relocate.

There are many exemptions and benefits offered by the Law 41. It exempts money earned abroad from income tax. This is the biggest benefit that multinationals get especially that they only operate in Panama but render services abroad. Panama's infrastructure and location also allows these corporations to operate from a strategic point without undergoing the usual red tape for foreign owners and CEO's.

Hiring personnel and staff have also become easy through the said law. It allows international companies to hire foreign born employees without worrying about immigration restrictions. This even includes visa assistance to employee's families which allow them to stay in Panama even without obtaining work permits.

It is also a big plus that the country uses the US dollar as its official currency. Multinationals have the convenience of being in a global banking hub, as well as having a strategic geographical location which connects the North and South America.

Companies from around the world have already began their Latin American presence in Panama.

A few companies that have decided to benefit from Panama's laws include: Procter and Gamble, Caterpillar, Dell, Hyundai Heavy Industries, , Western Union, 3M, Vanity Fair, Peugeout, Roche and Merck.

Executive relocations mean furnished rental demand and increased home sales in certain sectors of Panama City for example in Panama Pacifico. 

The Panamanian Government has made key decisions to continue alluring foreign investment, with its continuous pursuit to improve infrastructures around the country such as airports, metro system, bridges, roads and more – We see a bright future in Panama for the decades to come. That is – if, we began to improve the overall distribution of resources to continue receiving the waves of people entering Panama and thus be more self-sustainable, independent and free when uncertain times come (we all remember the world economic crisis and to many degrees people believe we are yet to experience the unfolding of the global monetary system) – time will tell. 

Until then, Panama seems to be in an advantageous country for business - because of its geographic position, strategic importance (Panama Canal) and continuous economic growth.

The Panama Canal: Money making Machine

Ocean Reef – A beacon of Luxury in the City of Panama

 Have you ever dreamed of living on mainland, and yet reap all the benefits of living on a high-end gated community in an island, 360 view of the ocean with your yacht docked next to your home, viewing the entire city and yet not be in it? Well, we can help you with that and make that dream a reality. Panama has evolved in the real estate market, and demand for exclusive and luxurious homes continues to grow. Following the road past Punta Pacifica in Panama City you will find something truly spectacular. An artificial island built right on the corner of this area was created to satisfy a need of land and is now one of the most exclusive places to live in Panama. The development consists of two islands (originally 3 named La Niña, La Pinta and La Santa Maria named after the 3 ships used by Christopher Columbus) and a marina, all connected to the mainland. So far, the first island on the west has been successfully built and about 80% of the lots have been sold. This first one has a total surface of 87,552.96 mts2 and 72 lots for sale.  The second island of 103,251 mts2 is designed and scheduled to start construction within a year or so.

 

Ocean reef residents, club members and guest will enjoy a host of sumptuous amenities in a development that has much to offer. Lush landscapes, parks and recreational areas like tennis and others are featured prominently through the project. The two islands will be connected to the mainland by two bridges, making the commute to and from the mainland in the 160-meter (525 feet) bridge in only 5 minutes. It has a gate with 24 hour restricted access and monitored by trained security staff that will ensure the safety and privacy of the residents. We believe some homes will build a wall around it to increase safety, but diminishing the view. After all it is an island, so security must be a priority.

 

Having most of the lots and homes surpass the 1 million price tag makes this area a prime sector, where only a select few will manage to be part of, if they act quickly. We recommend checking this out, for it’s an investment worthwhile. Lots for the second island are increasing in price since demand is high. Out of the 72 lots available on the first island only hand full are left and surprisingly more than 90% of buyers have been Panamanian. Designs for homes are spectacular, and the marina will be something out of this world for it will be a Residential Marina and there will be limits on transient vessels and short-term rentals. The residents at Ocean Reef will have priority over non-resident whose lease agreements will be revocable with timely notification. An underground passageway was created to access the marina without having to drive above ground; a fleet of electric vehicles will be used for suppliers and workers.

 Grupo Los Pueblos are the ones who made this Island a reality since they focuse on innovative and unique developments of the highest standards and great magnitude. They have limited the development to 138 lots between both islands, unless a 3^rd or 4^th are created in the future. Over the years they have built thousands of homes and condos, several shopping malls, offices, and mixed-use complexes in Panama. Without doubt they are experts in real estate and construction management giving their costumers a sense of confidence in their investments. With this Master piece development, perhaps now Panama has made a statement and can be taken more accurately when referred as the Dubai of America.

 

 

For more information check out their website, or feel free to contact us!

Isla Saboga: A $1.5 Billion Island Development in the Archipelago of Las Perlas

ISLA SABOGA: Nestling in the rich turquoise waters of the Pearl Islands archipelago, just 35 miles south of Panama City, 750 acres of unsurpassed natural beauty will be home to an exclusive five-star retreat offering opportunities for luxury living, relaxation and adventure.

Isla Saboga is claimed to become a world-class eco- and medical tourism destination within the next decade, which by that time - “surviving” on Isla Saboga might mean checking your investment portfolio on your laptop while sipping a daiquiri on the ocean-view deck of a half-million-dollar home.

Take an 18 minute flight from the contemporary metropolis of Panama City and you will discover a cluster of secluded islands and inlets, once coveted for their abundance of jewels, now one of the country’s most valuable treasures offering a haven of unspoiled beaches, forests and tropical wildlife

“There are many islands in this sea. They tell me there are pearls in abundance, of great size, and the natives possess baskets filled with them” Vasco Núñez de Balboa to the King of Spain, 1513

It is claimed that within eight years Isla Saboga will be a $1.5 billion investment project with 2,500 condominium and five-star hotel units scattered around the island, overlooking 22 unique beach coves, each with its own beach club.

The Green Revolution is rapidly becoming a worldwide phenomenon, with ecotourism being one of the fastest growing industries today.

The project, according to Armel González’s master plan, will include a 150-slip marina, several hotels, spas and numerous residential condo communities, each of which will be constructed by independent developers.

“Las Perlas now has the necessary foundations to involve the local communities and promote biodiversity conservation, while achieving economic growth”. United Nations Development Program report

 Gonzalez has already purchased a $2 million luxury high-speed ferry that will start making daily runs from Panama City once the Trump Ocean Club finishes building its island clubhouse – complete with pool, restaurant and spa.

 “This will be like the Bahamas and the Galápagos combined,” Gonzalez says. “Isla Saboga is calling investors to come create a new destination in paradise.” The concept of the island, he says, is that it will be economically, socially and environmentally sustainable, while promoting a community dedicated to healthy, quality living.

To continue reading 

 

Panama Pacifico - A City with a Bright Future.

 We recently made the decision to move across the Bridge of the Americas from Panama City into the area of Howard where Panama Pacifico is in development. 

This is why:

“Panama is renowned worldwide for its connectivity. This competitive advantage is reflected in every detail of Panama Pacifico’s master plan, from fiber-optic networks to the latest trends in green building to walkable neighborhood designs. London & Regional Properties (LRP) is committed to the concepts that: sustainable redevelopment can complement environmental preservation; private enterprise and government can collaborate for the greater good; and long-term view creates long-term value. 

From its first steps through its evolution, Panama Pacifico demonstrates the power of connectivity in every aspect of this growing community.

 From studio apartments to family residences, retail spaces and Class-A offices to custom built warehouses, at Panama Pacifico there are a variety of options available for home buyers, investors, and business owners in this fast growing community.

 Panama Pacifico is a world that forms a bridge between tradition and innovation, country breathing space and big-city accessibility, private funding and government support. A true master-planned community that brings together people of all ages to live, work and play. A residential haven with a vibrant mix of walkable neighborhoods and smart homes. A global enterprise that offers unprecedented business advantages. All set within a sustainable landscape linked by parks and trails. 

The cornerstone of Panama Pacifico’s carefully phased development is its world-class master plan, laid out in four ambitious phases over the coming years. During its first eight years (2008-2016), Panama Pacifico is slated for $405 million in total real estate development. Actual investment as of December 2012 totaled $250 million. When complete, Panama Pacifico will offer: 

1 million square meters of new commercial space over the life of the project

$4 billion in total investment

20,000 new residences

40,000 new permanent jobs

1,500 construction jobs

Millions of dollars in goods moved through the community on an annual basis.”

So why exactly did we choose to move to Panama Pacifico? Its simple:

There are lots of Opportunities for business and investments

We LIKE nature,

Its close to Panama City,

And we get to cross the bridge of the Americas more frequently, reminding us how amazing the Panama Canal is and how important it is for the world!

If you wish to know more about Panama Pacifico you can check out their website www.panamapacifico.com  – also, you contact us directly if you wish to discuss any particular area for your investments in the Republic of Panama. 

 

A City of Health in Panama

 

Panama has had its largest Health Center for more than 35 years now, called the Arnulfo Arias Madrid Hospital Center. The current government made a wise choice to develop its replacement, and to make it in a way that will benefit the entire population of Panama and create a stepping-stone into a healthier country. In 2012 this huge project was approved and began construction. The Ciudad Hospitalaria Ricardo Martinelli Berrocal of the CSS is located next to the road leading to the cenetenario bridge of Panama and will have an estimated cost of $587 million, with the first phase to be delivered in March or April 2014. This new Hospital City of the Caja de Seguro Social of Panama will be structured as a Sanitary Complex, with a fantastic response capacity. It will become the largest health center with the highest degree of technology and complexity regarding health in the country. 

 

This month, FCC (the company building it) announced a global advance of 28%. The timeline for completion of the second phase will be in may 2015, which consists of the pediatric facilities, the patient hotel, and administration buildings, amongst other medical facilities. Inside this city there will be 44 operation rooms, 217 emergency rooms, more than 1700 beds and 3500 parking spaces. Amongst many other amenities this amazing project will benefit more than 2.5 million people, and take Panama to next level in the health industry. Having the latest and greatest of medical technology equipped in this city (including the Da Vinci Robot and others) will definitely boost Panama’s image in the medical world and increase its tourism as a medical destination. This will give people from around the world more incentives to be in a country that offers world-class treatments for a far more accessible price.

 

For more info, check out the Caja de Seguro Social website:

 http://www.css.gob.pa/pro-ciudadhospitalaria.html

Chiriquí: Valley of the Moon - A destination worth Investing

Chiriquí in its core is PURE ADVENTURE!!! Not to mention in many ways it’s also considered a “safe haven”.

In terms of Lifestyle – Chiriquí has many benefits

There is a GREAT sense of Biodiversity

Briefly explained: at only 40 km distance there is the 2nd hottest place of Panama (City of David = average 35 Celsius at sea level) and the coldest point of the country (top of Volcan Baru = average 0 Celsius – 3,475 m above sea level)

This is one of the reasons why Chiriquí is known nationally in Panama as the fertile lands for agriculture, and from global perspective is known for its flowers diversity and high quality coffee) yes! We drink lots of coffee! Chiriquí is blessed with lots of fertile volcanic lands.

 Surrounding the Valley of the MOON, there is Bocas del Toro (islands), also the Gnobe Bugle protected reserve (lots of indigenous culture), there is also the frontier of Panama- Costa Rica (free zone for shopping), and along the whole coast there is the Pacific Ocean (great fishing and islands)

 Chiriquí has a surface of 6,476 km2

As of 2010 the population is 410,000 – where as, in 2000 there were 369,000 people.           

 Its politically divided in 13 districts: Alanje, Baru, Boqueron, Boquete, Bugaba, David, Dolega, Gualaca, Remedios, Renacimiento, San Lorenzo, San Félix and Tolé.

 The province of Chiriquí also produces great quantities of hydroelectric energy, which is exported to Panama City and even Costa Rica.

 The development in the tourism sector has had a significant impact in the social-economic fields of Chiriquí, we believe it began in Boquete with the baby boomers curious of what our father Sam Taliaferro had envisioned as a “safe haven” in the community he designed called Valle Escondido.  Since then real-estate has taken its course and now there is a new highway connecting David (second largest city of Panama) and Boquete – this infrastructure has encouraged developers to begin with residential projects and more…

 Boquete has grown in the last 10 years in a very impressive way where it’s fair to say “for the greater good of the whole district”… Now there are many restaurants, hotels and many touristic activities such as:

• Canopy
• River Rafting
• Rock Climbing
• Coffee Tours
• Bird Watching

There are new installations of Wellness retreats specialized destinations such as LaVida Optimal Wellness Destination, beautiful sights, and the extreme challenge of Boquete (hiking up the famous Volcan Baru) amongst many other things to do.

 In terms of security Chiriquí is in great shape compared to other places in the world – as we explained the region has its own energy, produces most vegetables for national consumption, industries and construction is growing, and overall commitment of people who want to learn and work hard to make the lands a better place for the future is a PLUS!

 I like to tell people so they can grasp the idea how biodiverse Chiriquí is in a practical example: “We could be up in the mountains enjoying coffee right beside the river, and in just 2 hours we could be in one of our favorite islands called Gamez drinking a pina colada, and while we are at it we can “go fishing” and see if we get Lucky!”

SHARE your comments if you’ve been to Chiriquí before! 

 IF you wish to visit as tourists or investors you can contact us, and we will point you to the right direction – we are very enthusiastic when it comes to showing why these lands are filled with Opportunities.

Investments in Panama’s International Airports

    Panama is known as the “Hub of the Americas" - Why?  because it connects all the main cities and countries of the Americas, thanks to its geographic position, and continuous improvement of infrastructure.  To maintain this status it is necessary for Panama to make investments and stay up to date with technology. The International Airport of Tocumen is currently the only airport in Central America with two runways for use, and is also the largest and busiest airport in the country and Central America by passenger traffic. With the current expansion that will cost around 800 million and will hopefully be completed by the end of the year, Tocumen S.A. manages the Airport and will invest another 10 million in the upgrade of the Panama Pacifico’s International Airport, which serves as a secondary strip when Tocumen is closed due to bad weather and also is used for maintenance of the BIG planes.

 The Scarlett Martinez International Airport of Rio Hato is the only airport in the beach region and will be operational by March 15th, 2014. The first official commercial flight will be landing on April 2014. This will make it the 7th international airport in the country and a total of 54 landing strips/airports exist across the country. Charter Flights from a company in Canada have been announced to start operating. Air Canada, Air Transat, Can Jet and Webjet, were some of the private charter companies who expressed interest in operating last year. Others from Colombia, Venezuela, and Spain will begin to land once the RIU Hotel in Playa Blanca begins operations, and more hotel rooms are available.

 New tunnel for the International Airport of Rio Hato (Scarlett Martinez)

The Scarlett Martinez International Airport’s total cost was $53.2 million, which included the restoration of the strip, the airport terminal, and the construction of a tunnel for the Pan-American Highway that previously crossed the runway.  This airport will serve to boost tourism across the several Beaches on the pacific side, and all condo/house developments, resorts, and activities in the area. A total of 274,000 passengers travelled across the country in 2013. Without doubt this airport will play a significant role in the current and future development of the whole region, making it a booming area for investments. This will impact the 230,000 people that live in the region, enabling new jobs and opportunities for many.

 Sketch of the new Tocumen International Airport

With so much investment in infrastructure, Panama is expected to continue to top the lists of “best places to live, invest and retire” for years to come.