What are the offshore advantages of Panama?

The Republic of Panama is perhaps the ideal destination for anyone looking for serious financial privacy and no taxes, corporate or personal. Its proximity to the growing Latin market makes it a natural base for world business operations and, in spite of its history, it isn't directly under the thumb of either the U.S. or (unlike Bermuda and the Cayman Islands) the U.K.

Nearly every major world bank has a full-service branch office in Panama, with representation from Japan, Germany, Brazil, and the U.S. As in Wall Street or the City in London, Panama City's business district high-rises bear the logos of Chase, Lloyds, Dai-Ichi Kangyo, Swiss Bank Corp., Republic National, Credit Lyonnais, and Dresdner.

Derek Sambrook, an international bank regulator and trust expert based in Panama, points out: "Brass plate banks represented by a law firm, for example, are not permitted in Panama, and the 102 banks that do operate are fully staffed and functional. Compare that with the Cayman Islands, which has more than 500 banks, but fewer than 10 that are full-service retail banks."

Admittedly, it's taken time for the banking sector's reputation to recover from the aftermath of the 1988 U.S. military invasion. That left nearly every financial institution in Panama under suspicion of drug money activity. Under the direction of DEA and FBI agents, invading U.S. troops hauled away bank records alleged to show criminal conduct by the deposed president Noriega and his regime accused of drug trafficking.

Since then, Panama's bankers have been anxious to reassert the sanctity of their banking secrecy laws...which have a long history in this country. Along with Luxembourg and Liechtenstein, Panama adopted specific tax haven legislation in the 1920s.

A central part of that long tax haven tradition has been statutory guarantees of financial privacy and confidentiality. Violators can suffer civil and criminal penalties. There is no requirement to reveal beneficial trust or corporate ownership to Panama authorities. Bearer shares are permitted. And Panama has no double-taxation agreements and no tax information exchange agreements with other countries.

While "dollarization" is debated as a novel concept elsewhere in Latin America, the U.S. dollar has been Panama's official paper currency since 1904. (The local equivalent is the balboa, and there are Panamanian coins that circulate along with U.S. coins).

Panama has no central bank to print money, and, as Juan Luis Moreno-Villalaz, an economic adviser to Panama's Ministry of Economy and Finance, recently noted, "In Panama...there has never been a systemic banking crisis. Indeed, in several instances, international banks have acted as the system's lender of last resort. The Panamanian system provides low interest rates, around 9% on mortgages and commercial loans. Credit is ample, with 30-year mortgages readily available. These are unusual conditions for a developing country and are largely achieved because there is no exchange-rate risk, a low risk of financial crises, and ample flow of funds from abroad."

Panama grew as an international financial center after enactment of Decree No. 238 in July 1970, a liberal banking law that also abolished currency controls. The law exempts offshore business in Panama from income tax and from taxes on interest earned from domestic savings accounts and offshore transactions. Since February 1999 a new comprehensive Banking Law has been in place, which could prove to be the legal structure that will confirm Panama as a leading world offshore finance center.

Panama's growing financial sector also includes its active Stock Exchange, captive insurance and re-insurance companies, and financial and leasing companies. At the Atlantic end of the Canal is the Colon Free Zone, a tax-free transshipment facility for world trade.

However suspect it may have been in the past, Panama is fast becoming one of the world's major financial crossroads. Base your business there and you're connected everywhere.

Recent quotes from articles:

The May/June 2001 issue of Modern Maturity (the largest consumer magazine in the world, with more than 20 million readers) rated Boquete Panama first-best retirement destination in the western hemisphere, number four in the world, following such developed favorites as the Costa del Sol in Spain, Cinque Terre in Italy, and Provence, France. As the article reported:

"If you love tropical lushness and don't need big-city stimulation, this lively little community near the Costa Rican border may be calling your name. The town's European and American ex-pats appreciate the stable political scene, the mercifully modest cost of living (you'll need about 25% less to live here than in a suburb in a medium-size U.S. city), the clean air, and the outdoorsy activities: river rafting, tennis and golf. Boquete is tucked into a fertile landscape of coffee plantations and orange groves where you can escape the heat of the lowlands."

"Panama is an undiscovered tourist paradise," The Boston Globe

"Panama is the most beautiful retreat in the world and almost undiscovered," claimed a recent article in Harper's Bazaar.

"Known mostly for its canal, Panama is, in fact, an undiscovered tourist paradise," stated a recent travel article in the Boston Globe.

National Geographic has also included long travel articles this year praising the undiscovered delights Panama has to offer.

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Since lots of people have a dream or a formed intention to buy a home somewhere on seashore or in the middle of a majestic park, or situated on the sunny hills covered with flowers or pleasing green - its is not surprising that first of all, in order to choose the best variant they would like to orient themselves in the wide range of offers from different countries and advantages of various forms of becoming a property owner. Boquete Highlands Mortgage dealing with Panama Real Estate, especially Real Estate Boquete Highland Park, and which specialties are Ranch and Farms situated around the picturesque area of Boquete, offers you the following information, the purpose of which is to get acquainted our clients with general financial advantages of being the participant of Panama City Mortgage or Boquete Highlands Mortgage. Why Panama Real Estate? The information on this page will reveal to you the great advantages of buying a house of your dream in this paradise. Real Estate Boquete Highland Park available for you with Boquete Highlands Mortgage gives you the possibility not only to become an owner of a house but to do it most profitably and favorably, turning to advantage of great Panama Real Estate business opportunities. Customer-oriented terms of Boquete Highlands Mortgage will surely attract your attention to Panama Real Estate as the most appropriate way satisfy all your needs. What are the offshore advantages of Panama? The Republic of Panama is perhaps the ideal destination for anyone looking for serious financial privacy and no taxes, corporate or personal. Its proximity to the growing Latin market makes it a natural base for world business operations and, in spite of its history, it isn't directly under the thumb of either the U.S. or (unlike Bermuda and the Cayman Islands) the U.K. Nearly every major world bank has a full-service branch office in Panama, with representation from Japan, Germany, Brazil, and the U.S. As in Wall Street or the City in London, Panama City's business district high-rises bear the logos of Chase, Lloyds, Dai-Ichi Kangyo, Swiss Bank Corp., Republic National, Credit Lyonnais, and Dresdner. Derek Sambrook, an international bank regulator and trust expert based in Panama, points out: "Brass plate banks represented by a law firm, for example, are not permitted in Panama, and the 102 banks that do operate are fully staffed and functional. Compare that with the Cayman Islands, which has more than 500 banks, but fewer than 10 that are full-service retail banks." Admittedly, it's taken time for the banking sector's reputation to recover from the aftermath of the 1988 U.S. military invasion. That left nearly every financial institution in Panama under suspicion of drug money activity. Under the direction of DEA and FBI agents, invading U.S. troops hauled away bank records alleged to show criminal conduct by the deposed president Noriega and his regime accused of drug trafficking. Since then, Panama's bankers have been anxious to reassert the sanctity of their banking secrecy laws...which have a long history in this country. Along with Luxembourg and Liechtenstein, Panama adopted specific tax haven legislation in the 1920s. A central part of that long tax haven tradition has been statutory guarantees of financial privacy and confidentiality. Violators can suffer civil and criminal penalties. There is no requirement to reveal beneficial trust or corporate ownership to Panama authorities. Bearer shares are permitted. And Panama has no double-taxation agreements and no tax information exchange agreements with other countries. While "dollarization" is debated as a novel concept elsewhere in Latin America, the U.S. dollar has been Panama's official paper currency since 1904. (The local equivalent is the balboa, and there are Panamanian coins that circulate along with U.S. coins). Panama has no central bank to print money, and, as Juan Luis Moreno-Villalaz, an economic adviser to Panama's Ministry of Economy and Finance, recently noted, "In Panama...there has never been a systemic banking crisis. Indeed, in several instances, international banks have acted as the system's lender of last resort. The Panamanian system provides low interest rates, around 9% on mortgages and commercial loans. Credit is ample, with 30-year mortgages readily available. These are unusual conditions for a developing country and are largely achieved because there is no exchange-rate risk, a low risk of financial crises, and ample flow of funds from abroad." Panama grew as an international financial center after enactment of Decree No. 238 in July 1970, a liberal banking law that also abolished currency controls. The law exempts offshore business in Panama from income tax and from taxes on interest earned from domestic savings accounts and offshore transactions. Since February 1999 a new comprehensive Banking Law has been in place, which could prove to be the legal structure that will confirm Panama as a leading world offshore finance center. Panama's growing financial sector also includes its active Stock Exchange, captive insurance and re-insurance companies, and financial and leasing companies. At the Atlantic end of the Canal is the Colon Free Zone, a tax-free transshipment facility for world trade. However suspect it may have been in the past, Panama is fast becoming one of the world's major financial crossroads. Base your business there and you're connected everywhere. Recent quotes from articles: The May/June 2001 issue of Modern Maturity (the largest consumer magazine in the world, with more than 20 million readers) rated Boquete Panama first-best retirement destination in the western hemisphere, number four in the world, following such developed favorites as the Costa del Sol in Spain, Cinque Terre in Italy, and Provence, France. As the article reported: "If you love tropical lushness and don't need big-city stimulation, this lively little community near the Costa Rican border may be calling your name. The town's European and American ex-pats appreciate the stable political scene, the mercifully modest cost of living (you'll need about 25% less to live here than in a suburb in a medium-size U.S. city), the clean air, and the outdoorsy activities: river rafting, tennis and golf. Boquete is tucked into a fertile landscape of coffee plantations and orange groves where you can escape the heat of the lowlands." "Panama is an undiscovered tourist paradise," The Boston Globe "Panama is the most beautiful retreat in the world and almost undiscovered," claimed a recent article in Harper's Bazaar. "Known mostly for its canal, Panama is, in fact, an undiscovered tourist paradise," stated a recent travel article in the Boston Globe. National Geographic has also included long travel articles this year praising the undiscovered delights Panama has to offer.