Panama Facts

Several theories exist about the origins of the name Panama.

The most supported of them all involves the Spanish form of the native Kuna word bannaba, meaning far away. A similar theory involves the name Panama coming from a word in a lost native language, meaning many butterflies.

A local legend today also claims that the name Panama itself has an outright native origin. Specifically, a fishing village had the name in the local language, which the Spaniards visited early on. As they took control of the region, they then supposedly applied the village’s name to the land at large. Officially, however, the Panamanian government defines the name Panama as having the meaning of many butterflies, fish, and trees.

The country has distinctive geography.

Panama lies in Central America, with the Atlantic Ocean to the east, and the Pacific Ocean to the west. It actually shares its name with the narrow land strip, or isthmus, linking North and South America with each other, called the Isthmus of Panama. A spine-like mountain range dominates Panama, which geologists call the continental divide. It formed independently by volcanic action, and separately from North America’s own mountain ranges.

As for South America’s Andes Mountain, only the continental divide’s highlands near the Colombian border have a relationship. Volcan Baru today holds the distinction of the highest peak in the continental divide, at 3.46 km high. It also counts as a dormant volcano, with volcanologists having dated its last eruption to around 1500 years ago.

It also enjoys a tropical climate.

On average, Panama has a temperature between 24°C and 30°C, with rare peaks of up to 32°C. The temperature also tends to stay lower on the Pacific side of the country, while frost may occur at higher elevations in the mountains.

As a tropical country, Panama enjoys plenty of rainfall, especially during the rainy season when the country receives up to 3 meters of rain. Meanwhile, the rainy season begins in April, and ends in December, with the Atlantic side of the country usually receiving more rain. That said, rainfall in Panama never drops below 1.3 meters, and as the country lies outside the Hurricane Belt, it only suffers from thunderstorms at worst.

Panama also has a rich biodiversity.

Forests cover up to 40% of the country’s interior, while mangrove swamps flourish along the shorelines. In many places, the swamps seamlessly transition into tropical rainforests past a certain point inland. The country’s rich plant life makes it vulnerable to deforestation, with an estimated 50% of Panama’s native plant life having died out since the 1940s.

Today, subsistence farming in the northeast and the southwest make up the biggest threat to the country’s forests, along with banana plantations in the riverlands near Costa Rica.

Europeans first arrived in Panama in 1501.

Rodrigo de Bastidas arrived in the region in that year and began exploring the interior for any signs of gold. Christopher Columbus himself paid a visit a year later and even founded a settlement at what would become modern Darien Province. Vasco Nunez de Balboa crossed the isthmus in 1513, with Spain coming to see Panama as the crossroads of the New World. Pedro Davila became the first colonial governor in 1514, and in 1519, would found Panama City.

Panama would later become the terminus of the Royal Road, where gold and silver from South America would arrive. They would then get loaded onto ships and then shipped back across the Atlantic to Spain. The locals, however, had another name for the road, the Road of Crosses, from the many graveyards surrounding the road for the workers who died working on it.

The European colonization of Panama proved disastrous for the indigenous peoples.

It wasn’t simply because the Spaniards enslaved them, or in the process of supposedly civilizing them, destroyed the native cultures. Instead, the greatest disaster for the natives from contact with Europeans involved their extermination. And entirely by accident at that, as the Spaniards didn’t actually have any interest in simply killing people.

Specifically, diseases such as measles and smallpox arrived in Panama with the Spaniards. And while those diseases could become deadly for the Spaniards, they had existed in Europe for a long time, giving them somewhat of resistance and a chance to survive. The natives, though, had never encountered those diseases before, and thus, had no chance against them. In particular, the Cocle and Cueva tribes had completely died out by 1535, barely three decades after the Spaniards first arrived.

The Spaniards had mixed success in Panama.

The Spaniards spent most of the 16th century fighting the natives in Panama, who controlled the interior. Frequent slave revolts further added to the Spaniards’ troubles, along with common attacks by English and Dutch pirates. In the end, the Spaniards finally managed to bring the situation under control by granting the rebels freedom in exchange for military service. Even then, pirates remained a major problem for the Spaniards well into the 17th century, when Henry Morgan stormed Panama City.

That said, Spanish Panama ultimately enjoyed around 200 years of prosperity which ended in the 18th century, as Spain’s own power in Europe began to fail. Improved navigational methods also meant more ships became willing to risk traveling south and through the Straits of Magelan.

Uncertainty marked the end of Spanish rule in Panama.

Regional leaders in Panama City had planned to declare their independence from Spain but found their careful plans disrupted by local independence movements. Acts from the latter, in particular, Azuero separatists in 1821, forced the nationalists in Panama City to declare independence sooner than planned. This led to a split between those who wanted independence for Panama as a single entity, and those who wanted independence as well for their localities. In the end, however, the local separatists fell into line thanks to Panama City’s complete control of the local military.

Construction of the Panama Canal led to Panama’s independence as a nation of its own.

Like we mentioned earlier, Panama, after the end of Spanish rule, stayed part of the bigger nation of Gran Colombia. Even after Gran Colombia fell apart, Panama stayed part of Colombia, which also suffered from instability at the time. This proved unacceptable to the US, which planned to build the Panama Canal at the time.

The Americans thus made contact with Panamanian nationalists and supported their push for independence from Colombia. In addition to diplomatic support, they received money, weapons, and even assistance from US troops. With the civil war having broken out in Colombia, the Colombians had no choice but to accept Panama’s independence.

The US originally owned the Panama Canal.

In return for American support for their independence, the US not only received permission to continue building the Panama Canal, but also had it recognized as a US territory. This led to resentment from Panamanian nationalists, who felt used with the idea that the US used their independence as a means to an end. They also resented American control of the canal, as well as Panama not receiving a share of its profits. That said, these sentiments stayed limited to nationalists until after WWII. Until that time, most Panamanians stayed satisfied with the situation.

However, with the spread of anti-colonial opinions after WWII, most Panamanians now began demanding the US give them the canal. American refusal to do so caused unrest, but in 1974, US President James Carter, negotiated the Torrijos-Carter Treaties. This led to Panama receiving the canal in 1999, in exchange for guaranteed passage for US warships through the canal at any time.

They also originally supported the military dictatorship in Panama.

The Americans gave their support to Panamanian dictator Manuel Noriega in exchange for several concessions. First, they wanted Noriega to support a firmly anti-Communist foreign policy. Second, they wanted Noriega’s cooperation regarding American anti-Communist operations in the Western Hemisphere. Third, they also wanted Noriega to allow the CIA to operate secret bases in Panama. And finally, they wanted guarantees to continued American control over the Panama Canal. Giving the Americans what they wanted cost Noriega nothing while opposing them meant the loss of his power. As such, the dictator gave the Americans everything they wanted.

The American intervention in Panama met with mixed responses around the world.

Although Noriega kept his end of the bargain, by the 1980s, the US government had decided Noriega’s regime caused too much trouble than beneficial to the US. In particular, his involvement in the drug trade made the US look bad for supporting him. Also, by the late 1980s, the US had found evidence that Noriega also made deals with the Communist Castro regime in Cuba. Harsh crackdowns on democratic protesters, including assassination and murder, further made continued support for Noriega unacceptable. This led to the American invasion in 1989 after Noriega openly cheated the elections in that year.

Ironically, despite having criticized the Noriega Regime for decades, the UN condemned the American invasion. They called it a violation of Panama’s sovereignty, and a crime against international law. In the end, the US simply ignored the General Assembly’s non-binding resolution against their country. And along with Britain and France, vetoed a binding resolution by the UN Security Council. In contrast to the UN, the Panamanian population largely supported the US intervention in their country.

The Panama Canal makes up the country’s most important asset.

Today, ships from over 80 countries pass through the Panama Canal regularly, thanks to the canal allowing quick and safe passage between the Atlantic and Pacific oceans. In financial terms, an estimated $270 billion worth of trade passes through the canal every year. This greatly benefits Panama, as their ownership of the canal allows them to collect toll from every ship that passes through.

While this also pays for the canal’s maintenance and upgrades, the country still makes quite the profit from the tolls. Statistics estimate that on average, the Panama Canal makes an estimated $2 billion every year, of which an estimated $800 million goes to the national treasury.

Panama has a very large financial sector.

In fact, the financial sector forms an estimated 9% of Panama’s economy, close to the Panama Canal, which makes up 10% of the economy. This also makes their financial sector the biggest in Central America, with customers not just from Panama itself, but also from all over Latin America.

Panama’s financial sector also has a reputation for prioritizing their customer’s privacy and secrecy. In that sense, the country has become the biggest tax haven in the Americas, preferred by customers even over Switzerland. This, however, has led to accusations that Panama has become the money-laundering center of the world. The Panamanian financial sector also remains far smaller compared to Asian competitors such as Hong Kong and Singapore.

Tourism in Panama has steadily grown over the past few years.

So much so, that tourism has actually surpassed the financial sector, now making up 9.5% of the country’s economy. An estimated 2.2 million tourists come to the country every year, supporting an estimated 4 million workers in Panama’s tourism industry.

The growth of the tourism industry has also led the Panamanian government to introduce incentives for foreign investments in the sector. These include complete exemptions to income and real estate taxes for 15 years, as well as tax exemption for imported construction materials for 5 years.

Panama also has a small but solid agricultural sector.

Small, as in it only makes up an estimated 7% of Panama’s economy. Crops grown in Panama include bananas, cocoa, coconuts, coffee, corn, potatoes, rice, soy, and sugar. This sector also includes animal husbandry, with both cows and poultry raised in Panama, as well as the lumber industry.

On average, the country produces an estimated 3 million tons of sugar per year as its biggest agricultural product. Bananas, however, make up its most valuable export, making an estimated $96 million per year, despite exporting only 400,000 tons. In contrast, sugar only makes an estimated $14 million per year for Panama. Also, Panamanian agriculture’s focus on cash crops for export means the country must import food to feed its people, primarily from the US.

The country only has one mine.

That said, it and its related industries do make up a full 1% of the Panamanian economy. The mine opened in 1997, in Colon Province, to exploit the local gold and copper deposits. Production today stands at 3 tons of gold per year, as well as 270,000 tons of copper per year.

The country also belongs to the Colon Free Trade Zone.

It covers the area around the port of Colon in the city and province of the same name, and makes up the biggest free trade zone in the Western Hemisphere. Sitting on the Atlantic Ocean, the port handles 92% of Panama’s exports, as well as 64% of its imports. The tax-free nature of trade in the zone directly contributes to Panama’s large volume of trade, in addition to the presence of the Panama Canal nearby.

As of today, only the port area itself remains part of the zone, however, in 2021, businessmen have proposed expanding the zone to cover the whole city. They hope that by expanding the tax-free area, it would further encourage foreign investment and trade, thus increasing the profits of the zone as a whole.

Panama also has other important ports.

These include Cristobal, which handles all trade on the Atlantic end of the Panama Canal. There’s also Balboa, which does the same on the Pacific end of the Panama Canal. Cristobal, in particular, handles 2.21 million TEUs of shipping containers per year, second only to Santos in Brazil.

Panama also operates deepwater ports at Charco Azul on the Pacific side of the country, and Chiriqui Grande on the Atlantic side of the country. These deepwater ports service oil tankers, supplemented by the Trans-Panama Pipeline. The canal runs from both ports, and then inland across the isthmus. The pipeline allows oil to get offloaded safely at sea, before piping it to refineries inland.

The country also has the largest airport in Central America.

Specifically, Tocumen International Airport, which directly services the capital of Panama City. It also doubles as the home base for Copa Airlines, Panama’s native airline company. The airport’s routes primarily provide flights to cities across the Americas, but some routes do lead to Asia and Europe. Statistics estimate that 4.53 million passengers pass through the airport every year, with an estimated 50,000 departures and arrivals every year.

Roads in Panama have a mixed reputation.

On one hand, Panama’s road networks have high standards compared to other Latin American countries. Also, the law requires that both passengers and drivers wear seatbelts while in a vehicle. On the other hand, the law doesn’t require vehicles to have airbags, with many vehicles thus not having them. Roads also may not have light at night, making driving after sunset something of a dangerous prospect. That said, many local governments in Panama restrict night driving for exactly that reason.

Panama actually has no military of its own.

Panama actually abolished its military as far back as 1903, when it gained independence from Colombia. The closest thing the country has to a military comes in the form of the Panamanian Public Forces, which also makes up its national police. They also feature small air and maritime units, allowing them to perform security duties on the sea and in the air, in addition to law enforcement on the land.

Before the formation of the Panamanian Public Forces, the National Police held that role, which later became the National Guard in the 1950s. The National Guard would eventually set up the dictatorship which ruled Panama until the 1980s. The return of democracy also saw the end of the National Guard, which the Panamanian Public Forces replaced.

Panama became the center of a global scandal with the Panama Papers.

In April of 2016, an anonymous whistleblower leaked 11.5 million documents to German journalist Bastian Obermayer. These documents exposed over 200,000 offshore clients as part of a fraud, sanctions, and tax evasion schemes under the corporate law provider, Mossack Fonseca. These clients came from over 100 countries around the world, including over 500 banks, such as HSBC, Credit Suisse, and Swiss UBS, among others.

Other clients included relatives of world leaders such as Chinese Premier Xi Jinping’s brother-in-law, former British Prime Minister Margaret Thatcher’s son Mark, and even the mistress of King Juan Carlos I of Spain, Corinna Larsen. Even celebrity Jackie Chan had links to the Panama Papers scandal.

All these led to an international investigation, and despite attempts by Mossack Fonseca to cover up the details, there was public disclosure of the whole affair. This caused business to dry up for the company, leading to its closure in March 2018. The company’s founders, Jurgen Mossack and Ramon Fonseca would find themselves briefly imprisoned in Panama for their involvement in the affair. And as of 2020, both men also found themselves wanted in Germany for charges also related to the affair.

Panamanian music enjoys a mix of European and native influences.

Examples of these include the saloma and the mejorana, which have vocal themes similar to those in the Seville region of Spain. However, the traditional native instrument used to play music for these genres includes the 5-stringed guitar called the mejoranera. There’s also the rabel, a 3-stringed violin used for cumbias, pasillos, and puntos, especially popular in the Cocle, Herrera, Los Santos, and Veraguas provinces.

Outside of traditional genres, modern Panamanian music includes jazz, with a tradition going back to the 1940s, and the artist Luis Russell. For the present day, the Panamanian singer and composer Erika Ender remains one of the biggest and most prolific artists of modern Latin American music. In particular, she co-authored the hit song Despacito in 2017 with Luis Fonsi and Daddy Yankee.

Panama has a distinctive cuisine.

As a tropical country, tropical fruits, herbs, and vegetables all dominate Panamanian recipes. Fresh seafood also makes up a large part of Panamanian recipes. Ceviche makes up one example, a dish made from fresh, raw fish, cured using citrus juices.

Other popular dishes in Panama include empanadas, a traditional Spanish dish also popular in other Latin American countries. Compared to their neighbors in Latin America, Panamanian cuisine usually features milder flavors. Staples include cassava, corn, plantains, rice, and in addition to seafood, meat like beef, chicken, and pork.

Panama also has a solid handicrafts tradition.

These include ceremonial masks, pottery, and wood carvings, with the last category especially well represented in Panamanian architecture. Rural Panamanians once made traditional baskets for daily use, but today, they more commonly get sold to tourists. In fact, many villages in Panama today almost completely depend on the sale of handicrafts to tourists.

The indigenous Guna people also have a reputation for making a type of cloth called molas. The name mola normally applies to the blouses Guna women wear, but they use the same type of cloth for parts of their houses. Several different layers of cloth make up a mola, each with different colors, and loosely stitched together with a reverse applique technique.

Panama City’s Christmas Parade has a reputation of its own.

They call it El desfile de Navidad, featuring parade floats in the red, blue, and white colors of the Panamanian flag. The parade also features women in traditional pollera dresses, while men wear the traditional montuno. In addition, the parade also features marching bands as additional entertainment, while providing accompanying music for the parade. On Christmas Day, the parade makes its way to where a Christmas tree stands in public. There, the parade ends with the singing of Christmas carols around the tree.

Traditional Panamanian wear has a distinctive appearance.

The montuno makes up the traditional Panamanian wear for men, featuring white cotton shirts, black trousers, as well as woven straw hats. Women traditionally wear pollera, based on 16th century Spanish dresses made from white linen. Pollera typically has ruffled blouses and skirts, the latter meant to appear like a peacock’s tail when lifted up. Matching pom poms hang off the pollera’s front and back, along with four ribbons and five golden chains. Either a black ribbon or a golden cross gets worn on the neck as a choker to finish the dress, along with slippers that match the dress’ color. Women also traditionally wear their hair in a bun while wearing the pollera.

Baseball enjoys widespread popularity in Panama.

In fact, it makes up the country’s national sport, and with a national baseball league of its own. Panama also has its own national baseball team to represent the country in international competitions. Today, over 140 Panamanians have played in various American baseball teams, more than from any other Latin American country. These include Bruce Chen, Manny Sanguillen, and Mariano Rivera, among others.

Other sports also have followings of their own in Panama.

These include soccer, which began to gain popularity in Panama towards the end of the 20th century. Panama first competed in the FIFA World Cup in 2018, though, they lost all 3 games they participated in. Basketball also enjoys popularity in Panama, and like with baseball, Panamanian players have become part of American basketball teams. These include Rolando Blackman, a 4-time NBA All-Star who played as part of the Dallas Mavericks. There’s also Kevin Daley, who played with the Harlem Globetrotters. Other popular sports in Panama include golf, taekwondo, tennis, and volleyball, among others.