Panama Investor Blog

New Orleans airport announces new non-stop flight to Panama

Copa Airlines announced that it will begin offering non-stop service four times a week between New Orleans and Panama on June 24, 2015. The announcement makes New Orleans the 11^th U.S. destination for Copa Airlines and its 71^stoverall.

Until now New Orleans has been one of the only U.S. cities without non-stop service to Latin America.

Pedro Heilbron, CEO of Copa Airlines, said in a statement that the new flights will not only boost business opportunities between Louisiana and Panama, but will also improve connectivity to more than 55 destinations in Latin America. 

The announcement drew a range of local officials to Louis Armstrong New Orleans International Airport, including Mayor Mitch Landrieu, New Orleans City Councilman Jared Brossett, and New Orleans Aviation Board Chairwoman Cheryl Teamer.

Among those pushing hardest for the new international flight has been economic development organization Greater New Orleans Inc. Over the past two years, representatives from GNO Inc. visited Panama City on two occasions to meet with Copa Airlines chairman Stanley Mota and president Pedro Heilbron, according to GNO Inc. spokeswoman Caitlin Berni.

During the announcement ceremony, GNO Inc. CEO Michael Hecht said the new direct flights between Panama and New Orleans represent a "re-opening of the Gateway to the Americas."

In an accompanying email, Hecht noted that the new partnership "fulfills one of our top priorities - to reconnect Greater New Orleans to its historical ties to Central and South America - and thus catalyze a broad range of growth opportunities for the businesses, ports, universities and hospitals of our region."

The airport's director of aviation Iktikhar Ahmad said he and his team have been pursuing the Copa Airlines for close to five years.

Flights from New Orleans will depart on Mondays, Tuesdays, Thursdays and Saturdays at 6:55 a.m. and arrive at Copa's Hub of the Americas at Tocumen International Airport in Panama City at 10:19 a.m.

Return flights depart Panama on Mondays, Wednesdays, Fridays and Sundays at 6:33 p.m. and arrive in New Orleans at 10:02 pm.

The plane, a Boeing 737-700, has seating for 12 passengers in first-class and 112 in the main cabin. Flight time is approximately three and a half hours. 

How can Panama capitalize on the canal expansion?

By: BN Americas

The Panama Canal expansion will boost the inter-oceanic corridor's capacity by 40% and consolidate the country's position as a north-south connection hub for the Western Hemisphere.

However, to fully exploit the expanded canal, scheduled to begin commercial operations in April 2016, Panama needs to invest in new port infrastructure and improve operations at its container terminals, according to the latest BNamericas Infrastructure Intelligence Series report.

"Moreover, Panama must continue to revamp its institutional framework to improve its position as a logistics center, which is highlighted by a lack of integration between the country's maritime infrastructure and land connectivity," the report says.

When construction finishes on its third set of locks, the canal will be able transport up to 550Mt of cargo annually, versus its present maximum capacity of 350Mt.

It will also be able to handle modern container ships of up to 14,000 TEUs, compared to the canal's current size limit of 5,000 TEUs, and provide passage for liquefied natural gas (LNG) carriers, most of which are too large for the canal at present.

In anticipation of the increased traffic, private port operators in Panama are increasing the capacity of their container terminals, while canal operator ACP is promoting the development of a transshipment container port on the Atlantic coast.

When all of these projects are complete, Panama should have capacity to handle 16.6mn TEUs per year, according to the report.

The administration of President Juan Carlos Varela is also putting together an institutional and legal framework for a master logistics development plan and has allocated US$109mn for public port infrastructure investments through 2019.

Faster-than-expected demand growth and reduced costs have led Panama to start evaluating the construction of a fourth set of locks, the report says.

"Obviously, the starting point will be what the demand studies tell us, and those will take us a year," said Oscar Bazán, VP of planning and business development for ACP.

The canal authority expects to re-evaluate its forecasts next year.

Billionaire boom: Where the money is now

The world has 155 new billionaires, pushing the worldwide total to 2,325.

That's a 7% jump from 2013, according to the 2014 "Billionaire Census" from Wealth-X and UBS.

So who is your standard billionaire? According to the report, the typical billionaire has about $3.1 billion, is 63 years old, and did not reach the $1 billion threshold until their late 40s.

Almost 90% of them are married, and on average, have two kids a piece.

They like to hang with other billionaires: They have relationships with nine ultra-high net worth individuals, three of whom are billionaires.

They're mostly male: Just 286 of them are women.

They're self-made: About 60% of male billionaires fully made their fortunes themselves, and another 27% have at least partly made their money themselves. Though it's a different story for the women -- just 17% are self-made. More than 65% of women billionaires inherited their wealth.

They own a lot of stuff: The typical billionaire owns four properties, each worth an average of $23.5 million. About 35% of billionaires have their own private philanthropic foundations, and one in thirty billionaires owns a sports team or a race horse.

Education isn't required: Not all billionaires have a wall full of degrees. In fact, the report states that 35% of global billionaires do not have bachelor's degrees.

And where do they live?: Nearly 35% of the world's billionaires are concentrated in 20 cities, only two of which are in the United States. Despite that, the U.S. has the highest number of billionaires, accounting for close to 25% of the world's total billionaire population.

A record 3,415 Americans ditch their Passports

The number of Americans choosing to give up their passports hit a record 3,415 last year, up 14% from 2013, and 15 times more than in 2008, when only 231 people renounced their citizenship

Experts say the recent surge is coming from expats who no longer want to deal with complicated tax paperwork, a burden that has only gotten worse in recent years.

Unlike most countries, the U.S. taxes all citizens on income, no matter where it is earned or where they live. The mountain of paperwork can be so complicated that expats are often forced to fork over high fees to hire an accountant -- some say they pay as much as $1,000.

"You do have a lot of people queuing...there are people still waiting to get their second passport [before they] renounce," he said. "Obviously, you can't give up your [U.S.] passport unless you have another one."

Of course, some Americans giving up their passports could very well be fat cat tax cheats, fleeing to known tax havens to preserve their wealth. But it's illegal to renounce your U.S. status to escape paying taxes, and giving up your citizenship now doesn't mean Uncle Sam won't come after you later for back taxes.

"From an international perspective, the world is split into two halves -- the people who are desperate to get U.S. citizenship, and the people who are desperate to give it up," Chris McLemore, senior counsel at Butler Snow, told CNNMoney in December.

Panama is not taking Advantage of its Maritime Connectivity to Export Products

The Canal and container ports are among the major assets of the country, but little local cargo is exported.

Panama leads the maritime connectivity in Latin America, and the continent is only surpassed by the United States, however, this facility is not exploited to increase industrial and agricultural exports.

This is part of the considerations that collects logistics Apediana Economic Development Letter entitled: outstanding debt, released yesterday by the Panamanian Association of Business Executives (APEDE).

The Panama Canal and the five container ports are among the main assets, but little local cargo that comes along with destination elsewhere.

By contrast, many other products coming from other South American countries as fruit, fish and mineral move. All production Ecuador banana and grapes, pears and apples from Chile used Panama's logistics infrastructure to send to other destinations.

The lack of incentives for agricultural and industrial production is one of the reasons for the poor Panamanian exports, says Rommel Troetsch, president of the Panama Maritime Chamber.

 The cultivation of some products such as rice, potatoes and corn has been declining in recent years, which has to be imported to supply the local market. Policies needed to promote the production not only for consumption but also for export are needed.

Lufthansa reaches Panama coming November 16th 2015

German airline Lufthansa will begin flying to Tocumen International Airport from November 16 with five weekly flights.

The company connects to Panama with the German city of Frankfurt, the economic center of the old continent, where the European Central Bank is.

With the flight to Frankfurt, Panama adds the fourth direct connection to Europe (Spain, France, Netherlands) and shared with Colombia to Portugal flights.

Company spokesmen indicated that Panama is a growing tourist destination and allow entry to other destinations through Copa Airlines.