Why this is important to Wisconsin businesses: The country has one of Latin America's highest GDP growth rates, and serves as a hub for regional trade in addition to having strong domestic demand.

Panama has historically served as the trade hub for Central and South America. Its strategic location has made it not only a maritime and air transport hub, but also an international center for trade, banking and services. Panama's dollar-based economy offers zero foreign exchange risk, as well as low inflation relative to its neighbors. Its government is stable and democratic, and actively seeks foreign investment in all sectors, especially services, health care, tourism and retirement properties.

Panama has a population of slightly over 4 million people and has one of Latin America’s highest GDP growth rates, estimated at 5.2 percent for 2016, with a slight decrease to 4.8 percent forecast for 2017. Roughly 1.5 million people reside in Panama City and its outlying metropolitan areas.

Tariffs have dropped to zero for 87 percent of U.S. exports to Panama, providing a competitive advantage for U.S.-made goods. For the rest of the items to which tariffs do apply, the tariffs are relatively low – an average of 7 percent for industrial goods, regardless of where the products are manufactured.  U.S. products and services make up 30 percent of Panama’s imports.

Panama’s medical equipment market is estimated at $140 million in 2017, with government spending representing over 60 percent of market demand. The U.S. is Panama’s top trading partner, and accounts for around 55 percent, or $7 million, of Panama’s medical equipment imports.  Many Panamanian doctors are U.S.-trained and are accustomed to using U.S. equipment, as well as following U.S. medical practices. U.S.-made medical equipment is very price-competitive, due in part to lower freight costs. Another advantage is that U.S. companies often provide 30 to 60 days open account credit to well-established distributors in Panama, while competitors from Europe and Asia usually require cash in advance or irrevocable letter of credit terms. Thus, Panama is a market that Wisconsin companies to consider as part of their export strategy, not only for sales within the market, but as a gateway to other markets in Central America and perhaps even South America.

Panama’s medical equipment market is highly competitive, with more than 50 companies representing and distributing medical equipment with highly trained sales staff. Promotion is primarily accomplished through trade shows and conferences, as well as direct visits to clinics, hospitals and individual physicians.  Panamanian medical distributors and end users frequently attend U.S. medical trade shows and regularly participate in training programs offered by manufacturers.

Demand is driven by a large expatriate population and growth in medical tourism, as well as a sizable local population who possess private health insurance coverage and desire better care than is offered in government facilities. Private hospitals generate demand as they frequently renew equipment and facilities in order to remain competitive in a dynamic market.

Many Panamanian doctors have been trained in the U.S. and are very familiar with U.S. equipment and medical practices, and most of Panama’s large, private hospitals are affiliated with U.S. hospitals and health organizations. However, competition from Europe and Asia has increased as those countries have implemented aggressive financing and marketing practices.

Medical devices and equipment in Panama are subject to inspection and compliance with the Health Research and Technological Development Department and the Medical Devices Regulation and Monitoring Section of the Ministry of Health, with no significant restrictions on the importation or marketing of medical equipment. Companies wishing to enter the market are advised to work with a local distributor or representative.

The Expo Medica Panama 2017 trade event focuses on the health, medicine and sports industries, and is a recommended event for meeting potential distributors and networking to gather information on the local market. The event will be held Oct. 19-20 in Panama City, and  over 100 suppliers and distributors are expected to exhibit. Wisconsin companies interested in the Panamanian market and neighboring Central American markets should consider attending this event, which is hosted by the Panama Chamber of Commerce.