🇵🇦 Panama · 2026 edition
Investing in Panama City
Panama City ranks 3 of 13 Latin American cities on the ProLatam Data Index with 51.5 of 100, and 4 of 13 on the ProLatam Score. Its strongest pillar is economic dynamism (76), its weakest is innovation (14). A foreign shareholder pays 32.50% in total on repatriated profit, under a territorial system.
ProLatam Data Index
51.5
Rank 3 of 13, balanced weighting
ProLatam Score
48.2
Rank 4 of 13, market-entry weighting
Strongest pillar
Economic Dynamism
76 of 100
Weakest pillar
Innovation
14 of 100
How Panama City scores on each pillar
Eight pillars, each normalized to 0 to 100 by a fixed published rule. A dash means the source does not cover Panama City, which is not the same as a zero. Coverage of the weighted index for this city is 100%.
Swipe the table sideways for the reported value, the weights and the source.
What a foreign shareholder pays in Panama
Corporate income tax plus the standard non-treaty withholding on the dividend paid out of what is left, which is the figure that actually reaches an owner abroad.
Total on repatriated profit
32.50%
Corporate income tax
25.0%
Dividend withholding
10.0%
Standard non-treaty rate
Compliance hours per year
408
World Bank Paying Taxes, 2018 data
Panama taxes on a territorial basis, so income sourced outside the country is generally outside the net, which matters a great deal to a holding structure. Territorial: income produced outside Panama is not taxed, and the SEM regional headquarters regime adds further relief. The cost is compliance: 36 payments and 408 hours a year, which ranked Panama 176th of 190 on Paying Taxes. A 4.67% alternative minimum on gross income applies above USD 1.5m.
Context, published but not scored
These shape a decision without belonging in the index. FDI inflows track the size of an economy rather than the appeal of a city, and a sovereign rating measures a government's ability to repay debt rather than a company's ability to operate.
GDP growth 2026
3.8%
IMF World Economic Outlook, national
FDI inflows
$905M
Inflows 2025 from INEC Panama, down 63% year on year; ECLAC publishes no country line for Panama in the 2026 edition.
Sovereign rating
BBB- (Stable)
Long-term foreign currency
English proficiency
492 (Low)
EF EPI city score, 1 to 800
Where Panama has moved since 2021
The rule of law pillar is the only one of the eight with a series comparable across five editions, so it is the only place this profile shows a direction rather than a snapshot. Scores are national, 0 to 1, higher is better.
2021
0.518
2022
0.517
2023
0.514
2024
0.518
2025
0.519
Over the period Panama held broadly steady, +0.001 points. A move under 0.005 is reported as flat rather than as a trend. Compare all 10 economies.
Sectors with a documented presence
International Banking
The International Banking Center closed 2025 with USD 163.0 bn in assets (up 4.23%), USD 116.8 bn in deposits and 63 licensed banks.
SourceCanal & Logistics
The Panama Canal recorded 13,404 transits in FY2025, up 19.3% after the drought, with revenue of USD 5.7 bn (up 14.4%); transits rose a further 5.2% in the first nine months of FY2026.
SourceWhere Panama's inbound FDI comes from
National statistics, share of inbound foreign direct investment.
- United States25.5%
- Colombia19.2%
- Spain14.3%
- Switzerland13.1%
- Other27.9%
INEC Panama, 2024 flows. The country breakdown for 2025 has not been published yet.
Citing the Panama City figures
Published under CC BY 4.0. Reuse is welcome, including commercially, with credit and a link.
Pro Latam. (2026). ProLatam Latin American City Investment Index 2026 (Version 2026.4) [Data set]. https://invest.pro-latam.orgSource: Pro Latam Investment Hub, ProLatam Data Index 2026 (https://invest.pro-latam.org). Updated 2026-09-04.
Considering Panama City for a market entry?
Pro Latam has been placing international companies in Latin America since 2010. The ranking is the public part of the work, and the rest is the part that depends on what you are actually trying to build.