Abstract

With low cost of living, a booming economy, and a government that supports business and foreign investment, Panama has become the perfect place for Americans to invest in. How is this all benefiting Panama? The country is posting tremendous growth numbers in real GDP, benefiting many citizens. However, economic policies introduced in the 1980s and 1990s, especially those emphasizing privatization and market competition, threaten lower income communities in Panama. Lower income communities depend on territorial basis for the upholding of their political and cultural institutions. With neoliberal policies, decentralization for these communities has caused developing organizations in Panama to either transfer competencies of the central state to new, anomalous, sub-nation units designated only for lower income communities or to transfer these competencies to existing, universalized units. Changes made by some of Panama’s construction companies or development projects have made these transfers easier to justify in the context of a more decentralized state. I examine why Panama has become a destination for (American) investments and migrants and the effects these investments have on local Panamanians (especially low income communities who are being displaced). Focusing on the United States, first, I discuss a brief history of foreign influence (including taxes and legal codes) that help encourage and promote investment in Panama.