Panama Clandestine Hotels
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Written by one of the leading experts on real estate and relocation issues in Panama, the Panama 101 – E-Book Guide To Living and Investing in Panama, 2009 Edition gives you the critical information you need to make educated lifestyle and investment decisions. Over 140 pages packed with detailed, insider knowledge that took years to acquire… can be yours in a matter of minutes. Preview the E-book, click here! |
Dear Panama E-Letter Subscribers:
Panamanian Economy, Clandestine Hotels, Government Against CorruptionBy Matt Atlee Alberto Vallarino, Panama’s Minister of Economy and Finance, told reporters this past week that the current rate of growth in the Panamanian economy is 0.31%. Vallarino expects the level of growth will increase throughout the rest of the year into early next year. April and May did see a slowdown in the Panamanian economy with some sectors showing negative growth: in the first half of 2009 the Panamanian economy contracted to negative 0.05% growth. That was a large drop from the 8.44% growth recorded in the first half of 2008. June did see a rise in the economy. Vallarino was quick to point out that the unemployment rate has not risen because certain sectors of the economy have remained strong: construction, telecommunications and transportation have stayed strong during the economic contraction, he said. The unemployment rate in Panama is normally between 15 and 20 per cent. The hope is that the Panamanian economy will return soon to the 8% growth rates of the last 5 years which made it the fastest growing economy in Latin America. Tourism is reported to have increased in Panama during the first half of 2009. The comptroller’s office reported that 8.7% more tourists arrived in Panama, though there appears to have been a 9.3% drop in hotel room occupancy. So where are all the tourists staying? Clandestine Hotels According to Tourism Minister, Solomon Shamah, tourists are staying in clandestine hotels. Many of these clandestine hotels are apartments that are being rented by the night rather than by the month. Many apartment owners have been unable to sell their apartments since the economic slowdown and have decided the best way to get a return on their investment is to go on the internet and turn their apartments into hotel suites. This has caused real controversy: other apartment owners have complained about having total strangers living in their apartment buildings and see the renting of apartments as hotel rooms as a security problem inside apartment towers. Members of the hotel association argue that they are losing business because clandestine hotels don’t pay the 10% tax on hotel rooms that normal hotels have to charge. Noriega’s Future Former dictator of Panama, Manuel Noriega, has been laying low since the United States Supreme Court decided in July that he could be extradited to France where he is wanted on money-laundering charges. The final decision on Noriega’s extradition will be made by Secretary of State Hilary Clinton. The odds are that Noriega will stay in a kind of neither nor state in the U.S. until a final decision in Washington can be made about what to do with Noriega. I imagine President Obama will want to drag out any decision on Noriega’s status until after the 2012 election. Colon Free Zone Back Taxes
Martinelli’s remarks about the Free Zone were in response to a strike that merchants in the Free Zone want to carry out on September 2nd in response to Martinelli’s decision to collect more taxes. Merchants want to paralyze the Free Zone and stop freight shipments. Corruption Crackdown Continues Martinelli’s government has also continued to crackdown on corruption, especially the corruption in the former government. One way of cracking down on corruption has been the withdrawal of Panama from the Central American Parliament (PARLACEN). By joining PARLACEN former presidents like Martin Torrijos and Mireya Moscoso have gotten immunity from prosecution. Joining PARLACEN means former government officials are given full immunity from prosecution in their home countries, but now that Panama has withdrawn from PARLACEN former government officials can be prosecuted. Martinelli has been very vocal about the need to send corrupt government officials to jail. Former Education Minister Belgis Castro is being held in jail on charges that he took money that was to be used for repairing Panama’s public schools. Panama City Metro System It looks as if the Martinelli government is serious about building a metro system in Panama. A contract is going out to bid on how much it will cost to build the new metro system. Companies from the U.S., Spain, Switzerland, Mexico and France are bidding on the contract to assess the cost of the new metro. The contract will be worth $2 million dollars and will awarded by October 2009. U.S. Embassy Demolished The former U.S. Embassy on Avenida Balboa will be demolished in order to make way for a new government tower. The Embassy was built in 1940 and has been empty since the U.S. moved their Embassy to Clayton in 2007. The building was a hated symbol of U.S. power in Panama. Written By Matt Atlee Panama 101 – E-Book – $69
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Panamanian President Ricardo Martinelli is going after the Colon Free Zone for back taxes. Martinelli announced on a televised program that the Free Zone is making something like $1.5 billion dollars from foreign sales and paying only $62 million dollars in taxes to the state. Martinelli said it was “inconceivable” that the Colon Free Zone could be suffering so much when it is a Mecca of wealth in a poor city like Colon. Martinelli wants to increase tax collection in the Free Zone and use it for social development programs in Panama.