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For what it's worth...

PIDD
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Tuesday, July 17, 2007

Dear International Living Reader,

The government of Panama has recently made changes to its tourist visa policy that has vacationers, travelers, and especially second-home owners scratching their heads. And it has some travelers who have booked an extended stay in Panama calling foul.

There is much controversy about this, and if you read our Panama First Alerts (sign up free here), you already know what's going on. But let me set the stage. Up until about a month ago, visitors from the U.S. or Canada arriving in Panama paid $5 for a tourist visa--essentially a 90-day pass to paradise. If you wanted to stay longer, you could easily extend your tourist visa for another 90 days. This was perfect for young backpackers who wanted to truly experience the country, and it was an ideal situation for those on a professional sabbatical, and snowbirds who wanted to escape the cold, dark winter months up north.

But on May 25, 2007, Panama immigration officials shifted gears. Those who enter Panama now do so on a 30-day pass--extendable, perhaps, for another 60 days. Maybe you can get the extension and maybe you can't. The jury is still out on that. Extensions will be granted at the discretion of the immigration department, and to get one, you'll need to go to the immigration office, stand in line, take a number, take a seat, and wait until you are called to plead your case. (Or you can always spring for the cost of an attorney to help you, which may make things run smoother.)

Immigration officials say they are trying to expedite extensions, but it takes two days.

Be aware that the chances are high that your request for an extension may be denied if there's reason to think you're abusing the system. If you've been in Panama on a tourist visa for a while, you may want to pack up and be ready to go at any time. And if you have already booked airline tickets to Panama for a stay of more than 30 days, you may want to call the airline and see if you have any recourse if you are denied a visa extension.

If you have decided to make your home in Panama, you can apply for a residency visa. But these can be costly to get--and your approval takes about 90 days, although from the moment you apply, you can stay in the country on an interim basis. To qualify for a pensionado (pensioner) visa you must show verifiable proof that you receive a pension of at least $500 per month from a government plan or from a well-known private corporate plan. (Any age can qualify.) If you receive a pension from any other source, you must be ready to provide documentation to prove that the pension does exist. To qualify for the "person of means" visa, you must personally (not through a foundation or corporation) invest at least $200,000 in property and/or a certified bank CD in Panama. Another option is to obtain a forestry visa by investing $40,000 or $80,000 in a reforestation project. And you can always exit and re-enter the country every 30-90 days (if you've been favored with an extension). But unless you live near the Costa Rica border, this is not an inexpensive option--and, again, if there is reason to believe you are abusing the system, you may be denied entrance.

Why is Panama doing this? Officials say it is an anti-crime measure. They say undesirables from other countries are driving up the crime rate, and they hope the new policy will help control illegal immigration. As of May, Panama had deported 512 non-nationals in the year to date--from Colombia, China, Ecuador, Peru, and the Dominican Republic, among other countries--for lacking appropriate documentation.

So, is Panama getting rid of an undesirable element…or throwing the baby out with the bath water? There are plenty of good upstanding people who spend extended time in Panama--and extended amounts of money while doing so. My husband and I spent eight months in Panama last year…on a tourist visa. We were trying to decide if we wanted to make a permanent home there. We invested in property. We didn't spend a small amount, but it wasn't enough to qualify us for the "person of means" visa. Our jobs entail lots of travel…so we exited and entered the country often enough that our visas were always valid. If we'd had to make a "border run" every 30 (or even 90) days, though, you can be certain we would not have chosen to rent an apartment and set up house in Panama. (In the long run, we decided that Panama was not the place for us--but that's a different story.)

We've heard rumblings that Panama may be reconsidering this latest policy change. We understand the Panama National Assembly may rule to rescind this new tourist visa policy. If so, we'll provide details in our Panama First Alerts.

Panama has a lot going for it, and International Living is as keen on Panama as it has ever been. The tourist visa issue is a very controversial topic in Panama right now and there are many who believe immigration policies should be tightened. In my opinion, a 90-day extendable tourist visa seems more fair. If I were to advise a friend, I would say that if you own a vacation home or condo in Panama…and to recover some of your investment cost, you've been hoping to rent it out when you're not using it--especially to seasonal snowbirds--your prospects for that have been reduced.

But Panama still has much to offer--that's why it has been #1 on IL's Global Retirement Index for six years in a row. Whether you're enticed by the low cost of living, the friendly people, or the tropical climate, Panama is the ultimate retirement and relocation destination. Find out more from our experts at Live and Prosper in Panama, August 2-4. This seminar is a must for anyone considering a move to Panama. For full details, see here.

Suzan Haskins
Latin America Insider, International Living

The interesting question is this: Will Panama require U.S. citizens to obtain the visa, or waive it for U.S. citizens?

This dispels all the reports about how much Panama is doing to "attract" people to Panama. This makes their rules regarding U.S. citizens more restrictive than Costa Rica which still allows we "perpetual tourists" the same 90 day rules that we,ve always had.

There is widely accepted sentiment that this visa change will be reversed at least for North Americans in the next congressional meeting in September. Another typical political mindfart you see happen in all governments, including USA...passing bills without comprehending the fallout and price to pay. Costa Rica has passed and rescinded many stupid laws including in immigration in the past few years. When you live offshore, you learn to take these things with a grain of salt...and work around the temporary flairups. In my opinion, this will not halt the shift of retirees preferring the benefits of pensionado status in Panama over any other Central American country...

http://www.thepanamanews.com/pn/v_13/is ... ws_01.html
http://primapanama.blogs.com/_panama_re ... ecove.html

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All that a man achieves and all that he fails to achieve is the direct result of his own thoughts...

While I'm sure it will be tweeked to accomodate desirable North American visitors, the governments reasons for the visa change to me make alot of sense. By tightening things up and keeping track of who's there and limiting the perptetual tourist, you are going to be keeping out alot of undesirable elements. From hard-core criminals to the sleezy con guys that are able to slip under the radar with the 90 days visa.

Their take is that if it's much safer and you don't have a ton of foriegn low end scammsters around that they will attract more quality foreigners. It will inconvenience the hell out of me till I get my residency if they don't approve my 60 day extension but I think the long term benefits are well worth it. I left Costa Rica primarily for the crime and scams so I applaud any action to try to contain it.

Unfortunately, their current action was like taking chemotherapy for a simple headache. They risk huge damage both in the north american press and to the large snowbird tourism they have here...in order to control a few bad apples from Colombia and elsewhere. There is also a huges tendency here for the Panamanians to be in denial about their own level of criminal element...finding it easier to blame Colombians and other foreigners than to take responsibility for the huge inequities of their own system between the haves and have nots. These legislators in my opinion just dont get it...like most legislators anywhere including the USA. If they limit foreign seasonal migration, they will primarily be hurting the poor here more than anyone. Sure, a few projects and developers will be hurt as well...but otherwise, the rich are always covered in general over here.

I agree that they should do all they can to keep "bad apples", including gringo ones, out of this system. But this shorter tourist stay wont accomplish the goal. Many of the worst criminals from Colombia and elsewhere come here totally undetected from Darian...the jungled border zone with Colombia which has no road between the two countries...but plenty of water ways and trails for people to easily walk into Panama undetected. People can also get here anywhere on the coast by water. In my opinion, you want them coming in through the airport and immigration so that their presence is registered. I think there were other hidden reasons for the legislature to pass the shorter visa period. It will not impact crime levels. Cleaning up their court system and providing more opportunity for the masses in Panama is what they really should be focusing on.

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All that a man achieves and all that he fails to achieve is the direct result of his own thoughts...

Tman,

I am going to have to respectfully disagree with you on a few points. First, I think the new law will be very effective in keeping out the small time scammers. Guys like Randy, who used to hang around the Veneto claiming to have had his wallet stolen and asking for help. I can guarantee you he does not have residency, I can also pretty much guarantee that he's not going to have the money to leave and return every 30 days. What's he going to do?, go somewhere with a 90 visa where he can slip under the radar and ply his trade.

As for the more hard core people ie. the colombian criminals, even if they come in from Darien or on a boat they will still be subject to ID checks by the Panamanian police (who arent' shy about that). For the ones that come in legally with 90 days you can get alot of crooked stuff going, with 30 it's much tougher and if you're over your 30 days and get picked up you're out. What's a hard core criminal going to do?, alot will choose to go somehere with a 90 visa and less police enforcement.

Lastly, I don't agree with the part about the haves/havenots and the correlation to crime. While I agree money from a prosperous economy like Panama should be made to flow to all levels, I think it is incorrect to blame the crime on this gap or poverty in general. Costa Rica and Panama and alot of other countries have had huge gaps in wealth for hundreds of years without having a crime problem. The real surge in crime only came about fairly recently when various immigrants from different cultures started showing up. The trend has been that the larger crimes involve a foreigner who organizes and plans it and locals that help out. Armed robbery and kidnapping where virtually unkown in Costa Rica before the colombians criminals showed up

That being said I think they should and will find a way to screen this visa law so as not to negatively affect too many people that seek only to live well and contribute to Panama but if not I would prefer to go through the hastle to get residency rather than watch the country deteriorate as Costa Rica has. And if it means alot less people and alot less units sold etc. I will take quaility over quantitiy. The crime and daily minor scams is primarily why I left Costa Rica.

Its OK to agree to disagree Jsmythe...though I dont totally disagree with your concerns or premise. I just may not be as optomistic as you that this visa change would have any effect on crime levels. I truly believe it is more about protecting the Panamanian "rackets" from the better and more organized Colombian or foreign "rackets". And while yes, I dont mind seeing scummy or undesireable gringos having more limitations in being here...I think the blanket visa decision was and is more harmful than good for the country overall. You were already seeing a slow down in the real estate markets here...and it is noticeably SLOWER since this visa question arose. This is not a big enough market to suffer "mildly" during these swings of confidence politically and economically.

I am quite confident this will be turned around in September when the assembly comes back from their LONG vacations...but this whole exercise just goes to show how fragile the systems can be in all these banana republics and underlines the risk involved in trusting long term growth and prosperity in these markets. While retirement benefits in Panama are obviously still far superior to Costa Rica and other Central American countries...this has really tainted the confidence of THOUSANDS of prospective transplants to Panama. THAT is unfortunate for the country...and for those who now might hestitate to move or invest here. Believe me...I have been talking to a lot of recent gringo buyers here...and this really threw up unneccesary red flags.

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All that a man achieves and all that he fails to achieve is the direct result of his own thoughts...

as an aside, what is the cheapest price for a ticket to Panama.

has anyone ever gotten a cheap flight to Panama?

it seems to me that the prices are always a couple of hundred more than flight to other central and nearby south american countries.

I never see cheap flight to Panama, or if the price is lowered, there are always really high taxes and fees added in.

it seems to me that I should be able to find flights for less than 300 dollars out of miami or south florida.

no wonder we want to send Noriega to France. who wants to foot the air fare to Panama.

seriously, how can I get a cheap flight for 300 dollars or less to Panama out of Miami.

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The difference between a Sea Story and a Fairy Tale is that a Fairy Tale starts out 'Once Upon a Time..' and a Sea Story starts out 'This is no Shit...'

(export version only, some restrictions may apply, some assembly required, not valid where the sun don't shine...

if you live in the states of Poverty, Darkness or anywhere outside of The Blessings of Civilization Trust, Inc...other rules may apply)

Excellent post Tman, you hit my main concern right on the head. I'm OK with the current Panamanian rackets, it's the foreign rackets coming in I'm concerned with, the kidnapping, murder for hire and home invasions that you're seeing alot of in Costa Rica now, I would be really happy to keep those from taking hold in Panama. I applaud anything that makes it more difficult for the bad people to get in, by doing so you encourage alot of them to seek easier hunting fields elsewhere and that will have a great impact on future crime stats.

Even though I am involved with the real estate there, I think even if there is a short-term slowdown, I believe the long term benefits of a safe orderly society will be worth it. The right people will be attracted and permitted to stay. For sure some quality foriegners will be victims as they wont be able to qualify for the residency and that's an unfortunate side effect. But I think the government is doing the right thing in being proactive on this front. I also believe and hope they will tweek the law in Sept. as to affect as few good people as possible, me being one of them.

Let me first say that I have been living in Costa Rica for 3 years now and I LOVE IT. With that disclaimer out of the way,let me say that we have to realize that the two members who are debating (and ultimately agreeing) the advantages of living in Panama as oppsed to "crime-ridden" Costa Rica,are in the real estate business in Panama.

Good and valid point VB. And we both have been in the business in both Costa Rica and Panama so have qualified OPINIONS on what is going on in both markets in recent years. I obviously AM concerned about how the Panama visa situation will affect development and sales here.

As for the airfares Californicationdude...that has also been a double edged sword along the lines of what Jsmyth brought up. The "Discount hunters" will probably still end up in CR versus Panama. The price of entry IS higher here airfare wise than Costa Rica and I think has a couple explanations. One, the exit taxes you pay in Costa Rica when leaving are paid here as well...but are buried in the taxes side of your planefare...which personally I think is a better method than the separate lines and payment you have to do in CR. So, the plane ticket has that artificial element to it when it comes to total price. In addition, with the modernizing of the Panama airport that has happened rapidly and successfully, the taxes for that have come from airport taxes to the airlines as well. I think CR has paid for their airport upgrade in other ways...and I might add that the CR project has taken more than twice as long to complete as the Panama upgrade did. The only thing that CR has over the Panama airport is the organized and newer taxi system. Panama could sure learn something from CR in that department for their initial image coming into the country.

Finally, I believe another factor is COPA airlines which is locally owned by one of the big families here. They have maintained higher rates for Panama...and this encourages the other airlines to do the same. THere is much more business travel here than Costa Rica from all over latin america...and if you look at all those latin markets...colombia, brazil, argentina, et al...ALL those rates are higher than Costa Rica. I guess they are used to those rate levels and have budgeted for it. Costa Rica on the other hand has more successfully marketed and discounted to get the larger numbers of tourists going there from the USA and elsewhere. idid notice this year during high season that the CR rates were pretty much the same as Panama for a couple months when the planes were fuller. You see more gyration in prices in CR than Panama from my recent calculations. You just have to watch for specials to each destination.

In summary, there are pros and cons to wherever you choose to visit or live. There are other threads on Panama on this board that highlight differences between the two countries in retiree benefits and cost of living comparisons...so wont go more into that here. Just "search" the previous threads. Some of us love CR, some of us like it better in Panama. Its a YMMV thing...and probably most of us feel it all preferable to living in gringalandia...

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All that a man achieves and all that he fails to achieve is the direct result of his own thoughts...

...."and probably most of us feel it all preferable to living in gringalandia...." Now that's an indisputable fact if I ever heard one!!