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A Foreigners Take on Politics in Panama

By in Blog with 3 Comments

As of  July 1st, President Ricardo Martinelli has been in office for three years and has two years left in his term.  During that time, he has accomplished a number of his campaign promises but has also seen his approval rating plummet from one of the highest of any elected official down to well below 50%.  His “my way or the highway” style of government has been both a blessing and a curse featured in many major news outlets, sometimes in a not-so-favorable light. As a non-voting foreigner, I dont have any right to criticize the government of a country I am a guest in, however, I also believe in full disclosure.

Panama doesn’t seem to have the checks and balances system like the US government, meaning that priorities stemming from the executive position quickly become the law.  One thing that no one in Panama can deny is that a lot has gotten done in Martinelli’s first three years in office.  Panamanians will be reaping the benefits of a massive infrastructure overhaul, an expanded power generation capacity, an aggressive tourism and foreign direct investment campaign, and a number of social programs for school children and retirees. Every day in the news, Martinelli is building more “stuff” and this activity has become the stimulant for one of the world’s fastest growing economies.

From a foreigner’s perspective: Corruption still runs rampant, the government rarely consults the citizenry before enacting wide sweeping policy changes, and environmental and historical considerations are often overlooked in the name of expansion and personal gain.  This can be scary, but we always have to remind ourselves, this is STILL Central America and some things will never change.  I knew what I was getting into when I decided to move to Panama in 2007 and quite frankly, nothing really surprises me anymore.  You can still bribe a policeman to get out of a speeding ticket, you can still buy a six pack on a Sunday, and you can still get a solid breakfast for two for under $10.00 so in the big picture, we foreigners must weigh our pros and cons.

What the Panamanian people seem to be most angry with Martinelli is the fact that he makes decisions quickly and decisively without worrying about consensus.  As a foreigner living in Panama, invested in Panama, and planning to raise a family in Panama, quite frankly I have to say that Martinelli is doing a lot of things that will directly benefit me, my family, and my business.  He’s spearheaded change in the immigration policy and taken the initial steps to open the floodgates to foreign labor which will have an impact on construction quality down the line as more skilled foreign labor enters the market.  Tourism should get a boost with an increased presence of legal Colombian workers who understand the concept of good service, and maybe, just maybe, this city will see a reduction in traffic in three years when the Metro system is carrying up to 500,000 people per day underground.

This being said, there also continues to be cause for concern about this administration related to the construction boom.  While Panama’s credit rating continues to be analyzed favorably by Moody’s and the other credit rating agencies, many are questioning the current administration’s ability to deal with the massive growth that Panama (mostly Panama City) is experiencing.  The new mayor has her hands full trying to resolve problems that may have been created by past administrations but also seem to be exacerbated by the current powers that be who seem hell-bent on construction for construction’s sake.

The 100’s of ongoing road projects are nowhere near completed and many fear that Panama’s traffic headaches will get worse before they get better.  Again, the big payout will be in 2-3 years time, but residents already living in Panama and future expats need to consider that driving around the city may not be too easy for the foreseeable future.

While sensational media outlets here tend to focus on the grizzly murders (often gang related but sometimes not) Panama still feels like a generally safe city.  Crime was the big issue one year ago and has seemed to drop off the national radar somewhat as police chief Gustavo Perez and his team have grown in number and increased their presence in areas like El Cangrejo and Casco Viejo, so we’re making some progress there.

Overall, things here in Panama seem to be going in the right direction in terms of progress, but there is still a very strong political undercurrent and dissatisfaction with the current administration that will hopefully subside as things start to slow down a bit. This is to say, living and working in the developing world is, by definition, ridden with challenges. Learning how to deal with these challenges and making an educated decision based on benefits and downfalls is the name of the game. For me, and almost all of my cohorts, that decision is that Panama is moving in the right direction…and we’ll be more than expecting some more bumps in the road!

About The Author

Kent Davis, founder and Managing Director at Panama Equity real estate, has been widely quoted in publications such as Wall Street Journal, Time Magazine, The Miami Herald and the Financial Times for his unabashed views on the Panama real estate market. Panama Equity is regarded as one of the most active real estate agencies in Panama and Kent’s articles, reports, and market research projects have been syndicated by press agencies including Bloomberg and the Associated Press.   Connect with the Author via: Email | LinkedIn | Facebook | Google+


  1. Jai Florada says:

    An article in yesterday’s newspaper said that about 30% of the people here generate less than $3 per day in income. That and education need to be high priorities to move Panama forward.
    Major projects like the canal, the airports and the subway are moving along, and many jobs have been created, but the poverty here is astounding for a booming economy. A little more work is needed in the areas of improved housing, power supply and clean water to small villages and poor urban areas.

  2. Byron Enroth says:

    I too agree that Martenelli has done much to improve the infrastructure of Panama. He gets things done! In the USA it would take 20 years of studies, reports and political manuerving by all special interest groups before the Metro or many other projects he has started would be started-and the costs doubled or more due to waiting!

  3. David Dion says:

    Being a business man myslf I like the style of the “benevolant dictator”, Martinelli. Is it possible the Panamanian workers are nervous that others that have developed better skills and better work ethics might take their jobs? Is it possibel workers in the service industry will come in and replace the worst retail clerks and other service people in the Americas? Yes traffic is a huge problem but much larger cities in the world have conquered the problems. Why not Panama?

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