The world wide recession caused a business slowdown in Panama but the gross domestic product never dropped below 3 percent a year from as high as eleven percent in recent years. Traffic through the Panama Canal has dipped a little but revenues continue at sufficient levels to continue the ambitious expansion program. The Panama Canal Authority expects to see a return to recent shipping levels in a year and substantial increases when the expansion program is finished.
Business in this Central American banking center, insurance center, tourist center and trade center has simply settled down to a level that is normal in Europe and the United States, waiting to resume a growth rate comparable to China’s as the recession mends. The success of Panama’s middle class is good testimony to the growth of all facets of business here.
What Happened to Property Values and Why
A lot of North Americans (Norte Americanos here) felt the sting because of the precipitous fall in property values “back home.” Many took out a second mortgage on their first home in the states or Canada to purchase second homes in Panama. When real estate values fell up North many had to sell in Panama to cover their mortgage back home. In addition the recession numeros celulares de panama put a damper on new home and apartment purchases in this country for several months. Despite a reasonable economic climate and business conditions new high end real estate in Panama dipped substantially in price. That is to say, the problem with folks needing to bale out in Panama had little to do with Panama and a lot to do with conditions elsewhere. The result is that there are lots of underpriced properties in great locations in this country waiting for smart investors to find them.
As world trade picks up and the historic Panama Canal Expansion progresses towards completion Panama expects to see more growth going forward. Panama also expects to see property values rise substantially in the next few years. New buyers will come in to take advantage of prices that are extremely low by recent historic standards.
Panama Canal Expansion Will Change Global Shipping Patterns Forever
Panama is the narrowest part of the Americas. At fifty miles wide it is the logical spot for the Panama Canal connecting Atlantic and Pacific. Positioned on the land bridge between North and Central America Panama is ideally positioned for transport of goods and as an air hub for the Americas.
The Panama Canal has been open for business since 1914. Its construction was considered one of the world’s engineering triumphs. Run by the USA until 1999 the Panama Canal is now administered by an autonomous unit of the Panama government, the Panama Canal Authority (Autoridad del Canal de Panamá).
The Panama Canal Locks were built to allow passage for American war ships and pretty much all other shipping at the beginning of the 20th century. Now there are super tankers and container ships too large to pass through Panama Canal. The largest ship that can pass is defined as a “Panamamax.” The enlarged set of locks for the Panama Canal Expansion will allow nearly all current ships to pass as well as doubling overall capacity from roughly 5 percent of global sea trade to as high as 10 percent.
So-called panamax ships, designed specifically to fit the ninety-four year old Panama Canal locks, can carry 4,000 twenty-foot containers. Expansion will let “cape-size vessels” with as many as 12,600 containers pass through the new “third lane” Panama Canal locks.
Ports up and down the East coast of the Americas are installing giant cranes capable of servicing the huge boats expected to use the Panama Canal from 2014 onward. The canal authority expects to see as much as a doubling of transit volume when the giant, cape size, vessels begin to pass through Panama. After the USA handed over the canal the new operators have been developing the land along the canal for commercial use. The use of land along the Panama Canal to develop logistics operations, material assembly facilities, and the like is already creating more jobs that take advantage of global trade passing through the country.
