Shop Talk

The commentary here at Shop Talk will not always be quite as formal as the Euro essay preceding this one. Often, I (Bob Adams, Panama Wave’s CEO) will simply share thoughts related to Panama and its economic development. This is the first of those.

Mel Gibson is in town. He follows Bruce Willis, Brad Pitt, Arnold Schwarzenegger and others from Tinsel Town. He isn’t just visiting for the warm weather. He can have that in Australia or southern California. And he isn’t just here to visit the Canal, although I trust he was given the obligatory tour. If you live here and anyone you know visits, you will understand what I mean by “obligatory tour”. The visit is certainly worth it.

No, Mel wasn’t here for the sake of tourism. He came to buy. The papers said he was looking at the Azuero peninsula (that hump that extends south into the Pacific about mid-way along Panama’s coast). No surprise there, that’s the prime location for the Hollywood folks. What they didn’t mention is that he picked up a couple high-rise penthouses in Panama City as well. While local folks are shocked at the “insanely high” prices charged for these penthouses, the wealthy from North America and Europe are shocked at how low the prices are. When prices hit $3500 a square meter (about $330 a square foot), vastly higher than any other real estate in the city, people were amazed. They aren’t aware that similar high-end properties in New York City go for $55,000 a square meter or $60,000 in London. It’s all a matter of perspective.

Understanding Panama is always a question of perspective. My perspective is based on four decades of living and working in more than 40 nations on five continents ( Australia and Antarctica are still on my “to do” list). From my perspective, Panama is a developing nation that has become an emerging market and has a great future ahead of it.

If there is one perspective on Panama that I dislike, it’s the “ Third World” perspective. I’m not talking about Panamanians; I’m talking about North Americans and Europeans. Too many “gringos” are still stuck in the 20th century, in the days of the “Cold War”. Their images of nations like Panama are simply out-of-date. It amuses me that Hollywood actors are catching on to Panama before many high-powered investors. Although the investors are coming (the Trump Ocean Club is only the most obvious example), many still sit in New York, London, Amsterdam, Dubai and elsewhere, quite ignorant of the Latin American reality and Panama’s position in it.

Many outside investors I talk to are concerned with their safety and the security of their investments in Panama. So are a lot of other people. I can talk about the Peruvians, Bolivians (ah yes, the Bolivians), the Colombians, the Chileans, the Mexicans and the many other Latin Americans who live in Panama, but I’ll focus on the Venezuelans.

We don’t know how many Venezuelans are arriving to stay. However, there is plenty of evidence that they are here in greater numbers than ever before and that their exodus from Venezuela is growing. I have heard several real estate brokers in Panama express genuine surprise not only because they are seeing Venezuelans, but that these people are often middle-class, not just upper-class. According to the new arrivals, President Chavez has started a real “class war” and it isn’t directly only against the rich. And it isn’t just individuals and families, entire businesses are moving as well, including one of Latin America’s oldest (46 years in Venezuela) and largest television production companies.

Think about it. You’re a Venezuelan. Venezuela is your homeland. You have your family and your home in Venezuela. You have worked long and hard to build your business or professional career. But the situation at home is bad. The security of everything important to you is under attack. You fear that your property and money will be taken from you. You find some of your fellow Venezuelans are treating you as an enemy, not as a neighbor.

The decision to move everything to another nation is extremely difficult under circumstances like this. Just selling your home may be difficult, especially at a price you think reasonable. You have a great deal invested in your career and perhaps a business as well. You will lose some, maybe most, of that investment if you leave, but you feel you have to do something for yourself and for the future of your family. What is at the top of the list of things you are looking for in a new home?

That’s easy to answer: security and stability. The last thing in the world you want to do is to move from one dangerously unstable situation to another dangerously unstable situation. That absolutely must be avoided.

Every Venezuelan who moves to Panama says more about Panama’s security and stability than anything I can write here. It’s a very different perspective and it’s important to remember when considering your investment. This is not the 20th century. This is not a “banana republic”. This is the 21st century and this is Panama. The arrival of Latin Americans from nations with troubled politics is the reason Panama is sometimes called the “Switzerland of Latin America”. If you haven’t already, come on down to Panama and see for yourself.