The Republic of Panama, more commonly known as Panama, and its people Panamanians, was originally colonized by Spain and later by Columbia, which now lies on its Eastern Border.
Panama eventually seceded from Columbia in 1903, and as an independent nation immediately entered into a treaty with the United States for the construction of a Canal from its northern shores on the Caribbean Sea to the southern shores in the North Pacific Ocean. Control of an area of land on the perimeters of the proposed Canal was also given to the US. The authority over this area was left in the hand of the US Military and construction of the Canal to the US Army Corps of Engineers. The Canal was built between 1904 and 1914.
Panama became and probably is still best known for the Panama Canal and the then US controlled Panama Canal Zone. This area has played a significant role in the economic development of Panama, and to some extent, the politics of the country through most of the 20th century.
Panama, also referred to as the Isthmus of Panama, is a relatively narrow strip of land which, with Costa Rica on its western border and Columbia on its Eastern border. Panama infact joins Central America to South America.
The land mass of the Republic is 75,990 square kilometers with a tropical maritime climate, influenced by its rugged terrain and coastal plains. The official language is Spanish. About 14% of Panamanians speak English. The ethnic groups which comprise the Panamanians are: the Mestizo, which are mixed Amerindian and white. They constitute about 70% of the population. West Indian, Caucasian and Indian account for 14%, 10% and 6% respectively.
The Republic of Panama, which is a constitutional democracy, has had a tumultuous recent history with elected presidents being deposed by Coup d'etat's orchestrated by the Panamanian military. In 1989, General Manuel Noriega was deposed from the Presidency with the help of the US. Since then, a significant event has been the disbanding of the military and the stabilization of the Government through the electoral process.
There are three branches of Government, the Executive Branch, the Legislative branch and the Judicial Branch.
Executive power is held by the President and the Ministers of State. The President and two Vice Presidents are elected for a five year term and cannot be re-elected for a consecutive term. While the President and two Vice Presidents are elected by majority vote, the Ministers of State are appointed by the President, subject to approval by the Legislative Assembly.
The Legislative Assembly, composed of legislators, is elected from electoral districts. Each legislator is elected for a five year term.
The Judicial Branch of Government consists of the Supreme Court of Justice, five Superior Courts and three Courts of Appeal. The Supreme Court of Justice is presided over by nine (9) judges appointed for ten (10) years each.
Panama's seaports are one of the major contributors to its development. The Panama Canal completed in 1914, providing the gateway between the Pacific and the Atlantic Oceans, through the Caribbean Sea, created the opportunity for the Republic to emerge as the leading transshipment location in the region. The container ports are continuously being upgraded to keep pace with the demand.
The major airport is located 12 miles from the capital, Panama City. There are also a number of smaller airports in the country. The airports serve Panama with direct passenger and cargo access to and from major destinations in North, Central and South America.
Telephone service is provided by Cable & Wireless Panama. Cable & Wireless provides full telecommunications services within the Republic. A 100% Digital Network, Cable & Wireless provides national and international voice telecommunications. While other providers including Cable & Wireless compete for Internet and other data services.
Electricity is supplied at 110/220 volts and 60 cycles. There are on-going projects to expand and upgrade the generation capacity.
Since the handing over of the Panama Canal to full Panamanian control and the departure of the US Military, the economy has experienced a down turn due to the loss of the contribution made by the US Military presence.
Panama derives about 70% of its GDP from its port and canal activities, as well as its financial services and re-exports from the Free Zones in the Canal Area.
Other areas of economic activity are in agriculture, manufacturing, construction, transport, tourism and financial services.
Activities in agriculture and fisheries include banana production, sugar, coffee and livestock. The export of shrimp is becoming of increasing importance in the sector.
The manufacturing sector provides incentives to companies for the assembly of electronic and apparel products utilizing the Tax Free Zones and excellent shipping facilities.
Panama's banking sector has remained a high priority given its contribution to the economy and has earned the Republic a reputation for being a major financial center of Latin America.
The General Corporation Law, Law 32 of February 1927 for Panamanian companies or an Panama IBC, is one of the oldest existing laws that provides for offshore company incorporation and the tax free and confidentiality benefits derived. Panama has incorporated in excess of 400,000 non-resident corporations and continues to place a high priority on the sector for its contribution to the national economy.