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For the second year running, Panama takes top honors in our Annual Global Retirement Index, which this year features 30 countries. Panama has a lot going for it: 1) tropical weather, 2) low cost of living, 3) reliability and efficiency you don’t find in other Latin American countries, 4) favorable offshore banking laws, 5) stable economy (with the U.S. dollar as the currency), 6) government investment incentives that slash tax rates and fees for entrepreneurs…and give retirees discounts on everything from doctor visits to utility bills, 7) diverse geography (from mountain ranges to tropical islands…from a booming metropolis to vast jungles), and 8) the fact that it is still a relatively undiscovered paradise.  Where to begin? With so much good to tell you about Panama, it’s difficult to know where to begin. But as this is our Annual Global Retirement Index, benefits for retirees seems appropriate.

“Known mostly for its Canal, Panama is, in fact, an undiscovered tourist paradise.” Boston Globe

As a resident pensioner in Panama, you’re entitled to everything from 50% off the closing costs for home loans…to 20% off doctor’s consultations…and more.

And don’t worry. You’re not too young to be a pensioner. You can be as young as 18 to qualify. All that’s required is a guaranteed pension income of just $500 per month ($600 per month for a couple).
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Panama does not score first in any other single category; rather, it ranks well in every category. The truth is, Panama has nearly everything going for it, as its scores in the particular categories of our survey indicate: affordable cost of living (it takes second place here), varied and many cultural and recreational offerings (17th among the countries in our survey), good and cheap healthcare (giving it 14th position in this category), the most developed infrastructure of any country in this part of the world (ranking it 18th in this category), a stellar safety record (the Pinkerton Global Intelligence Agency rates Panama as the safest place in Central and Latin America for tourists, and it ties for third place in our safety category), and an appealing climate, tropical in Panama City and on the coasts, mild and springlike in the mountains in the interior (16th position in our survey).

The best of both worlds 

Plus, Panama offers a great diversity of real estate to choose from—from farmland in the fresh mountain highlands of Boquete…to beachfront in the Pacific Pearl Islands. And then there’s modern Panama City, all glass and steel on the water. 

Panama’s capital is one of the least expensive First World cosmopolitan centers in the world. Here you’ll find world-class restaurants, every imaginable luxury, hundreds of multinational businesses…all at about half the price you’d pay in a comparable U.S. city.

It’s not just Panama City’s skyline (which is more reminiscent of Miami or even New York than any Central American city we know) that looks First World...it’s that things here work. You can get through the airport quickly and efficiently. Your international phone calls go through the first time every time. Panama City is efficient and reliable, unlike any other Central American city we travel in.

Len Galvin, editor of our Pocket Money Real Estate, recently told his readers about a two-bedroom, two-bathroom apartment in Panama City on top of El Dorado hill, with great views, a parking space, and a swimming pool in the building, listed for $50,000. 

Or you can go up-market and invest in a 3,500-square-foot penthouse in a luxury building with a jacuzzi and roof rights—still a bargain at a negotiable $286,000. 
 

Panama's unique colonial heritage can be appreciated at Casco Viejo.

Boho-chic Casco Viejo This modern First World metropolis has a bubbling Latino alter-ego in its boho-chic barrio of Casco Viejo, the oldest European settlement on the Pacific coast of the Americas.  Greg Geurin, our man in Panama, has written a full report on this charming neighborhood (see page ??), detailing the tax breaks and incentives the being offered by the Panamanian government in an effort to attract investors to help restore this World Heritage Site. Once such restoration project is Callejón del Chicheme. A two-bedroom, 1.5-bathroom top-floor condo in this building offers stunning, unobstructed views of the Panama City skyline from a 400-square-foot terrace. The asking price is just $141,000.  A crisis opportunity Over the past two years, we’ve reported details of Panama’s short-term, current economic crisis, resulting from the handover of the Panama Canal and the withdrawal of more than 50,000 American troops from the region…and the collapse of world coffee prices.

These two factors have conspired to bring on a buyer’s market, big time. Many Panamanians, especially coffee farmers, are increasingly desperate to sell. And few locals have the cash to pick up the available property bargains. 

This is particularly true of the Chiriqui region, and our favorite spot in that region—Boquete. 

Boquete, just over the Costa Rican border, is in the mountains, so the temperatures are perfect year-round. No need for heat or air conditioning. 

The beach is an hour away by car. The bustling city of David, with all the comforts of home (plus superior medical care and a hospital), is less than a 30-minute drive. Golf, trout fishing, boating, birding, horseback riding, shopping...all wait outside your door. 

But because few Americans know about the advantages of Panama, and of Boquete in particular (this country receives about as many visitors per year as Disneyland gets in three days!), and, as I’ve mentioned, the current economic situation, real estate prices are extremely undervalued. I’m talking semi-custom homes built to a high U.S. standard (with high-speed Internet access) in a private, gated golf community, for example, for less than $50 per square foot.

Or, if you prefer, a little coffee farm in the hills for as little as $500 an acre. No kidding.

“Outrageously affordable”

As one reader wrote recently to tell us, “Why do people come to Boquete? It’s still outrageously affordable. There’s a feeling of freedom and security, something like being in the U.S. in the 1950s. The countryside is beautiful. The town is quaint—something like the ones in the old cowboy and Indian films. There are business opportunities.

“In Boquete there’s no need to keep up with the Joneses. They’re not here! The people in Boquete, relocating from other areas of Panama, Europe, Canada, the U.S., Australia, and Asia, are easy-going and relaxed.”

The twinkle of the sea

Maybe mountain living isn’t your thing. Maybe you’re in search of sand and sun. Panama has that in abundance, too. 

We recommend the island of Contadora, the seventh biggest of the 90 named islands in the Pearl Islands archipelago, in the Bay of Panama, just off the coast of Panama City. 

Here’s what friend and contributing editor to IL Bob Fordi has to say about Contadora: 

“This is the stuff of travel magazine cover photos: turquoise waters, 13 white-sand beaches, secluded coves, bright red and yellow fishing boats, swaying palm and cashew trees, giant coral reefs, coconuts, mangoes, parrots, hummingbirds, pelicans, sea turtles, and bright tropical flowers. I even saw gray and orca whales just off the island’s shores.”

We’re so impressed by the Pearl Islands and, specifically, the absolute privacy of the Island of Contadora that we’ve invested here ourselves. 

Today the island is a closely guarded secret playground for wealthy and famous political leaders, writers, entertainers, and businessmen—not only from Panama, but from all over the world. 

This island is well off most tourists’ radar screens, which is exactly what the people who come to Contadora want. It has only two resorts, one small condo complex, three small B&Bs, a few small homes...and several dozen large mansions. It’s a 650-acre island. During peak times, the population swells to about 1,500. Typically there are not more than 500 people here at any time.

That’s not to say the island is lacking in amenities. There’s a small airstrip and daily $52, 15-minute round-trip flights to and from Panama City. Or you can take the ferry, which runs every weekend. There’s a brand-new medical center on the island, several decent restaurants, a small nine-hole golf course, a few small shops, a scooter rental shop, and a well-stocked grocery store

Plus, Contadora is safe. I would feel comfortable walking anywhere on the island, anytime, even in the middle of the night. 
 

So there you have it: One of the world’s cheapest First World cities, the world’s next great mountain retirement destination, and an exclusive golden-sand beach hideaway…all in a country that, as we like to say, has its act together.

Despite what you may read in the mainstream press, Panama’s economic performance is, almost every year, better than just about every other country in Latin America. In fact, over the past 40 years, the country’s inflation rate has averaged less than 2% per year...that’s simply unheard of south of the United States. 

When you compare Panama to its neighbors, you’ll see that it has more amenities than traditional retirement spots like Mexico and Costa Rica—but costs and crime rates are lower. In Panama there is less red tape and less interference from local authorities. 

The government realizes that foreign investment will help the country as a whole…and so it has passed more than 40 laws protecting foreigners’ investment rights, including the Investments Stability Law (Law No. 54), which guarantees all foreign and national investors equal rights. 

Major companies in Panama include Federal Express, DHL, Sears, Price Costco, Bell South, Kansas City Southern Railways, Continental and American Airlines, ICA (construction), Cable & Wireless, Evergreen, Warranty Company of the Americas, and Hutchinson Whampoa. Plus, you’ll find just about every American franchise you can imagine on the streets of Panama City. 

In addition to Law 54, the government is offering other incentives for foreigners to spend time here, invest here…or even live in Panama. For example: 
 

Have you ever been to a place where you met someone who told you, “Yeah, it’s nice now…but you should have seen it 10 years ago”? That’s what we think you’ll be saying about Panama not so many years from now.
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