Why this is important to Wisconsin businesses: The country is a medical device hub for Central and South America, but is reliant on imports since it has no domestic production of these devices.

Panama has historically served as a trade hub for Central and South America. Its strategic location has made Panama not only a maritime and air transport hub, but also an international trading, banking and services center. Panama's dollar-based economy offers low inflation in comparison with neighboring countries and zero foreign exchange risk. 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 4.1 million people and has one of the Latin American region’s highest GDP growth rates, with a 5% growth forecast for 2019. About 1.5 million people reside in Panama City and its outlying metropolitan areas.

Tariffs have dropped to 0% for nearly 90% of U.S. exports to Panama. The country's tariffs are relatively low—an average of 7% for industrial goods, regardless of where the products are manufactured. A 0% tariff is a competitive advantage for U.S.-made goods—and U.S.-made products and services are already very competitive, with some 30% market share of Panama’s imports.

The medical equipment market in Panama is estimated at $170 million in 2019, with government spending representing over 60% of market demand. Given that there is no local production of medical equipment, the market relies entirely on imports, most of which are imported from the U.S.—which, as Panama’s leading trade partner, accounts for around 51% of medical equipment imports.

The local market is highly competitive, with more than 50 companies representing and distributing medical equipment, all with highly trained sales staff. Sales promotion is done through trade shows and medical conferences, as well as by 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. U.S. 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.

The public sector is the primary end user of medical equipment in health facilities run by the Social Security Fund (Caja del Seguro Social, or CSS) and by the Ministry of Health. The private sector is also experiencing strong growth, and has state-of-the-art medical facilities. Private hospitals, while not demonstrating the same growth levels, have maintained stable demand, as they frequently renew equipment and facilities to remain competitive in a dynamic market. Many Panamanian doctors are very familiar with U.S. equipment and medical practices due to training in the U.S. Most 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.

Promising sales prospects for the next three years include:

  1. Imaging equipment: radiology, ultrasound, CT and angiographic equipment
  2. Cardiovascular equipment: electro- and echo-cardiographs, defibrillators and blood testing equipment
  3. Intensive care equipment: monitoring and emergency room equipment and respirators
  4. Surgical equipment: anesthetic, blood circulation and operating room equipment
  5. Laboratory equipment: chromatography equipment and clinical chemistry, hematology and histology analyzers
  6. Electromedical equipment: therapeutic (surgical instruments, lasers) or diagnostic (imaging equipment, monitoring devices)

Due to its high quality, reliability and familiarity, U.S. medical equipment enjoys a strong reputation among Panamanian medical personnel. Medical devices and equipment in Panama are subject to inspection and compliance under 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 importing or marketing of medical equipment. The best market entry strategy is to find a reliable and qualified local distributor or representative. Panamanian medical equipment distributors representing U.S. companies tend to have well-trained staff and offer strong technical support.