Panama Elects New President: What It Means For Expats

Lately, Panama has become a magnet for expats, attracted by its favourable climate, prime geographical location, and excellent tax regime. The country has dedicated itself to attracting wealth and talent, as shown by the multiple residency options available for foreigners, such as the Panama Qualified Investors Visa. 

For these reasons, I decided to make Panama my home in 2019. I love this country so much that every year, my team and I put together exploration tours in Panama for my clients and Hub members to benefit from. Panama may be an appealing destination if you want to protect and grow your money. 

A few weeks ago, Panamanians elected their new president, José Raúl Mulino, who served as the Minister of Public Security under former president Ricardo Martinelli. Mulino is pro-business and pro-investment, and many Panamanians I talked to seemed happy with the election results. 

In this article, we will explore Mulino’s government program, “Alliance to Save Panama,” and, most importantly, what it means for expats like you.

I went on an investment tour during this period. Despite the blocked roads, I managed to get a helicopter to take my clients to the beach, which was a true luxury experience!

PREVIOUS ADMINISTRATION’S FAILURES

The previous president, Laurentino Cortizo, got into office promising to beat corruption once and for all, but his promises fell short; corruption is still pervasive in Panamanian politics, as is part for the course for most political systems. Moreover, the country has struggled with significant challenges and criticisms that require a change in Panama’s leadership. 

ABSENTEE LEADERSHIP

The former president was often absent due to serious health issues, including battling cancer, which frequently took him overseas for treatment. This absence left the day-to-day management of the country in the hands of the vice president and other ministers, who frankly left many things in shambles.

MISHANDLING OF THE CANADIAN MINE SITUATION

In November 2023, multiple protests regarding a Canadian-owned copper mine caused road blockages and food shortages. I even did an investment tour during those days, so things did not go quite as planned since multiple routes were unavailable. Thankfully, my clients could still check out many appealing investment options, talk to lawyers and see what Panama is all about.

The protests stopped only when the contract between the Panamanian government and this company, First Quantum Minerals, was deemed unconstitutional. Still, Panama's revenue loss is massive, accounting for around 4% of the GDP—all this because of some climate-change lunatics. 

ECONOMIC IMPACT

These shortcomings collectively had a severe impact on Panama’s economy. The mismanagement and absentee leadership created a fiscal deficit and slowed economic growth. This economic downturn highlighted the urgent need for competent and proactive governance to steer the country back on track.

The election of José Raúl Mulino may signify renewed leadership and a more robust economic strategy to address these past failures and set Panama on a path to recovery and growth.

Though skeptical of politicians, I see he isn’t entirely ignorant of economics. I hope the country thrives, as it’s both a land of opportunities and my family's home

THE NEW PRESIDENT: JOSÉ RAÚL MULINO

José Raúl Mulino, Panama’s newly elected president, could be a breath of fresh air to Panama. He is pro-business, pro-investment, and pro-mine. Believe it or not, he’s not a climate change alarmist and actually wants to boost the economy. However, let’s face reality: Mulino is also a politician, and we should never put too much faith in one, but among all the candidates, he seems the most capable of improving the country’s situation. 

Although I’m doubtful of all politicians, at the very least, he’s not a socialist and has some basic understanding of economics. Panama is a country brimming with opportunities and a home for my family, so I want the country to do well. 

MULINO’S MEASURES AND INTENDED IMPACT

Mulino presents himself as a pro-business leader willing to revitalize Panama’s economy and create an environment that attracts local and international investment. 

IMPROVING INTERNATIONAL TOURISM

One of Mulino's key proposals is to boost international tourism significantly. Recognizing the sector's potential to generate millions of dollars in revenue, Mulino aims to turn Panama into a premier tourist destination. His administration plans to enhance tourism infrastructure and forge partnerships with international tour operators and airlines to increase the influx of visitors, leveraging Panama’s warm and sunny weather and natural beauty. Among other policies, he intends to simplify the procedures for acquiring land, ease the permitting processes for new infrastructure projects and establish special economic zones.

SUPPORT FOR FOREIGN DIRECT INVESTMENT AND FIGHT AGAINST ILLEGAL IMMIGRATION

Mulino’s government plans to attract foreign direct investment (FDI) by creating a favourable business environment. This includes streamlining processes and offering incentives to foreign investors, such as creating special economic zones for tourism. Additionally, he aims to address the security issues related to illegal immigration through the Darién Jungle, a route connecting Colombia and Panama often used by migrants heading to the US. At the same time, he fully supports legal immigration policies that facilitate the entry of skilled workers and entrepreneurs, thus improving the country's economy.

I truly believe in Panama's bright future. José Raúl Mulino has a chance to make this small Central American country a hub for those dissatisfied with the rising totalitarianism in the west

MAJOR INFRASTRUCTURE PROJECTS

While many Panamanians work in Panama City, they may live in commuter towns and areas not necessarily in the city. There is already a public transportation system consisting of buses and metro, but many residents still need private transportation, forcing them to spend much time in traffic. Although Metro’s Line 3 is under work, connecting Panama Oeste and Panama City, Mulino aims to take infrastructure projects to the next level. Hopefully, he will be able to renegotiate the contract with First Quantum Minerals to bring back substantial revenue and fund the following ambitious projects:

• The Fourth Bridge over the Canal: Mulino aims to build the fourth bridge over the Canal, which is expected to benefit more than a million people on both sides and improve security and connectivity. The project was conceived in 2014, but construction works haven’t started yet. 

• Panama-David Train: Another major project Mulino plans to carry out is constructing the Panama-David train, which Mulino expects will create jobs, boost tourism, and increase connectivity between Panama’s main cities. Although ambitious and expensive, this proposal would help Panama’s economy expand and give travellers easier access to provinces on the way to David. 

• San Miguelito Cable Car: Inspired by Medellin’s successful cable car system, this project aims to resolve connectivity issues between the San Miguelito district and Panama City. It could potentially transport 4,000 passengers per hour and ease daily commutes.

INCENTIVES FOR FOREIGN DIRECT INVESTMENT IN TECHNOLOGY

Lastly, Mulino expects to grow FDI in technology from 2 to 15%, ensuring 35% of FDI is allocated to innovation and technology. To attract this investment, Mulino’s government would offer tax incentives designed to appeal to foreign tech companies and investors.

You still have the opportunity to secure Panama's renowned Qualified Investor Visa, granting permanent residency with a $300,000 real estate investment. This amount is expected to double after October 2024

CONCLUSION

Panamanians generally seem happy with Mulino’s election, but only time will tell whether he fulfills his promises. We can never forget that corruption is second nature in the political realm. Nevertheless, if all these measures are implemented, Panama can grow massively and create an even more appealing environment for expats. Many Panamanians I spoke to at a recent job fair seem happy with his election, so I’m fairly optimistic about the next five years. 

We can only act on the information we currently have, and opportunities may vanish overnight. I’m talking about the reputed Panama Qualified Investors Visa, which grants permanent residency by investing $300,000 USD or more in real estate. This investment minimum threshold is set to nearly double in October 2024, so if you want to move to a country with growth potential and an appealing tax regime, Panama might be the perfect place for you. 

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