If you’re tapped into your entrepreneurial side, you may have heard Panama calling your name.
Not literally, of course. But anyone who stays up to date on the international landscape knows that Panama is in full throttle. With the fastest growing economy in Latin America and a blossoming middle class, expat, and tourism scene, Panama has earned its title as an entrepreneurial haven.
I’ve been watching the start-up scene blossom since starting my own career here in the early 2000’s. As a real estate consultant professional, I find that my business-minded clients place high importance on an area’s commercial opportunity when purchasing property.
Part of my job is to help them find the ideal place for their personal as well as their professional goals.
There is no one right answer, of course. The best place for you to open your business depends on many variables. Still, experience has shown me that some places in Panama are better for business than others, and this is what I strive to show you.
Here, a breakdown of the best places in Panama to open a business, and the pros and cons of each.
Panama City
It’s easy to smell the opportunity in the air when walking through Panama City. With a population of over 1 million- many of which fall into the economic categories of middle to upper class- Panama City has no shortage of prospects.
The problem is the competition. With so much going on in such a jam-packed place, getting your business to rise above the others is a daunting task. There is also the cost associated with living and operating in Panama City- where just about everything is more expensive.
Pros:
- Massive population of possible clientele
- Presence of middle and upper income classes
Cons:
- More competition
- High rent and operating costs
- Harder to stand out
Bottom line:
If you’re opening up in what’s been called the “NYC of Latin America”- expect to go up against the same challenges you’d find in any big-city atmosphere.
Playa Coronado
Coronado is the most established community on the coast. Just over an hour outside Panama City, it’s the choice spot for expats, retirees, and wealthy Panamanians with second or third homes.
With its reputable community and vacation atmosphere, it’s easy to see why Coronado is a great place to open up shop. Indeed- many residents have, and the area is rich with local businesses.
The only potential downsides of opening a business in Coronado are these:
- The area has a lot of restaurants, many of which have already won their place in the hearts of residents. Open a restaurant in Coronado, and there will likely be one right next door.
- Coronado slows down quite a bit during “low season”- technically between May-November. I’ve had business owners tell me that their High Season practically carries them through the low – a phrase that seasonally based businesses are all too familiar with.
Pros:
- Concentrated expat population
- Busy on weekends with hotel guests and second homeowners
- Busy during High Season
- High median incomeSmall-town vibe that supports local businesses
Cons:
- Slow during low season
- Heavy restaurant competition
Bottom line:
A choice location, if your business can withstand the low season. And if it’s a restaurant, it had better be a good one!
Playa Gorgona
Dubbed “the next Coronado,” Playa Gorgona definitely poses some advantages (and disadvantages) in setting up shop. Located just 50 minutes from Panama City and 10 from Coronado, the area has really taken off in the wake of Coronado’s growth.
While Gorgona’s expat community can’t yet be compared to that of Coronado’s, it is growing- and fast. The commercial sector has yet to keep up, with very few businesses located in Gorgona itself. Residents, who commonly hit the highway for the 10 minute drive to Coronado, would love to see a few more neighborhood options.
Potential downsides of Gorgona include dropped numbers during low season, and a smaller overall community (as compared to Coronado.) But, with rapid residential growth underway (including the development of the highly anticipated Royal Palm) it won’t be long before that changes.
Pros:
- Little to no competition
- Close to Coronado
- Small-town vibe that supports local businesses
Cons:
- Smaller community (as compared to Coronado)
- Slow during low season
Bottom line:
Gorgona might not be booming yet, but it’s on its way. Rapid residential development, close proximity to Coronado, and little to no competition make up for its small but expanding community.
What about elsewhere in Panama?
I set out to explore the best places in Panama to open a business, and that’s what I’ve done. Other parts of Panama may have their own virtues but, in my experience, an advantageous business environment is not one of them.
Simply put, the majority of Panama is not developed enough to be able to offer most businesses a steady stream of clientele. You’ll notice I said most, because there are always those truly exceptional start-ups that succeed against all odds.
I do not aim to discourage you from following your dreams, if the Caribbean, or Las Tablas, or Chiriquí is where they may take you.
I aim only to provide you with an overview of the most business-friendly atmospheres in Panama, and the distinct pros and cons that accompany each. From there- the only person who knows what’s right for you (and your business) is you.
Hello! I’m confused as to what sort of business you CAN open in Panama. I know no salons, spas, or retail store. Does that include ALL retail of any kind???
Any suggestions about Boquete or the Highlands in general? If I move there, I must work.
Thanks!
Tobie
Hi Tobie, as an idea there are lots of expats who operate businesses in professional services, such as IT work or graphic design, some work in real estate or property management, others operate bars/restaurants or tourism related businesses. There are a number of things to consider when starting a business to be compliant with Panamanian laws, so I would recommend that if you were looking to do that you speak to a lawyer, who will be up-to-date on any changes in the laws. If you are looking at the Boquete area, make a recon trip to check it out and talk to the locals to do some groundwork, it’s a beautiful part of Panama! Liz
Is it possible to come visit Coronado and form a corporation there? I would like to stay away from PC if possible for opening accounts and finding a book-keeper.
Loved this post!
Hi Jim, and thanks! Yes, there are lawyers based here in Coronado who can get most parts of the process to form a corporation completed away from the city, and you can open up bank accounts at the local branches too. You may not be able to avoid the city completely but you can certainly minimize what you need to do there if that’s what you want to do. Cheers, Liz
I found your article very informative and helpful, thank you! In your opinion, where would be the best place to open a small business catering mostly to tourists (but locals as well) that is also on the coast? I am scouting out areas to open an all natural gourmet popsicle (paleta) business. Any thoughts?
Hi Luke, Coronado is the place to be. It’s where I live. We’ve got a thriving expat community here. I’d start by checking out Coronado. And make sure to let me know, when you’re planning to book a trip to Panama 🙂 My email is listed on the contact page.
My wife and I plan to visit in October of this year with plans for opening a business and possibly retiring. I found your article very helpful.
Thanks Kimani.