Did you ever wish you could own an island?

By Steven Rich, Marketing Manager for Panama Offshore Legal Services

Ever wish you could own an Island? Panama has many beautiful virgin islands beckoning foreign investors. Now they are available for purchase. Law 2 of 2006 regulates the leasing and sale of government properties in the coastal areas and islands. Prior to this law, ownership of islands was restricted to only nationals according to Panama’s constitution. Very few Panamanians hold title to island properties. Granting concessions or selling island and coastal properties owned by the government is very discretionary.

This "Island Law" provides for government concessions within designated tourism development zones for constructing residential properties as second homes and vacation housing for foreigners. This law also provides for the sale of island properties for tourism development including such residential properties. Before enactment of this law, it was illegal for any foreigners to own islands. Now, foreigners can own up to 50% of an island.

A transaction with the government is about the only way to acquire an island. If you could find an island owned by a Panamanian you could of course buy the title but very few Panamanians hold titles to island properties.

Here is how you can develop island and coastal properties in Panama by way of a concession.

Concessions are contracts between the government and tourism developers to lease properties with special " rights of possession". These special rights allow for specific tourist commercial developments such as hotels, restaurants, marinas, and amusement parks, including residential projects Concessions can be granted for either 40 years with a 30 year extension or 60 years with a 30 year extension. The length of a concession depends upon the amount invested and the number of new jobs the project generates.

Public bids are required for obtaining concessions and the sale of island properties from the government. Anyone can initiate a bidding process by writing a proposal to the Ministry of Economy and Finance describing a detailed tourist project for a specific area. The government can always offer concessions or sale of island properties by initiating an open bidding process on its own.

When a developer wins the bid, the concession process includes:

1. A master plan for the property’s development.
2. Approval of a first draft of the construction and work schedule.
3. Approval of a first draft of an infrastructure plan with public services.
4. Investigation of the developer’s financial re-sources.
5. Panama tourism institute (IPAT) certification that the area is within a designated Tourism Zone.
6. Filing an environment impact study.
7. Listing in the official IPAT’s registry for tourism com-panies.
8. A guarantee deposit equal to 10% of the projected constructions costs.
9. A minimum investment of $2 per square meter of the total area for a maximum period of five years.
10. A monthly lease payment calculated by the Ministry of Economy & Finance.
11. A master plan for all islands setting forth lease payments for all concession rights prepared by the Direccion de Catastro office.

Panama’s Island Law provides tax incentives for investors to develop large residential communities for foreigners on islands and coastal areas.

The immediate effect of the Island Law occurred on the day President Torrijos signed it into law when developers announced plans for more than $700 million in new projects on Panama islands.

Part two of this article in the next issue will include the requirements for purchasing island properties.

A nation may be judged by the way in treats its less fortunate citizens

In praise of the CSS

By David Dell

There is a saying that the true measure of a country’s greatness lies in the way it treats its less fortunate citizens. Panama’s social security organization, la Caja de Seguro Social (CSS) has had some bad press lately, because of the unfortunate problem of tainted medicines, but it is one of the country's greatest assets.

Ivan Flores is a good friend of mine and a great source of information for many of my stories. Ivan is not a rich man, and without the medical support of the CSS, I doubt if he would be alive today.

He invited me this week to the Rafael Hernandez CSS hospital in David, to witness his three-times-per-week, dialysis treatment for his failing kidneys. Located in the basement of the Rafael Hernandez hospital, the hemodialysis center helps people from as far away as Bocas del Toro. The need for kidney dialysis treatment is steadily increasing, partly because of that great, unseen killer – high blood pressure.

The dialysis center at Rafael Hernández Hospital.

The cramped waiting room only holds about ten people, so some patients have to sit and wait outside. Ivan took me into the treatment room. Here I saw 19 people hooked up to dialysis machines. The spotlessly clean and tiled room was cooled by a large, split air-conditioner. To my left was the nurses station where four charming women were laying out the connection tubes in preparation for the next set of patients.

Ivan smiled as he told me these nurses were, "angels in surgical gowns." Their kind words and caring nature were true medicine for the sick people here. I asked the nurses if they had a wish list, what would be the main item they would ask for. They did not ask for higher wages or shorter work hours –instead their thought was mainly for their patients. Their biggest wish would be to get spare parts for the machines, so they could continue helping people to stay alive.

I met eighty-year-old American, Robert Ice. Being treated just a few steps away was his seventy-two-year old wife, Rosalie. Robert and Rosalie have been residents of Panama for the past two years, and when she needed treatment, Robert first took his wife to a private hospital. After two weeks of treatment Robert was presented with a bill for $7,000. As a pensioner, Robert simply could not afford the high costs of private medical treatment. Fortunately, Robert managed to get into the CSS hemodialysis program.

Three nurses in the Rafael
Hernández hospital, David.

Robert and I talked about the difference between health care in Panama and America. It is much to the shame of the United States, that as the wealthiest country in the world it still does not properly care for its less-fortunate sick.

The David hemodialysis center is straining to keep up with its commitments. In the waiting room I talked with seventy-one year old Guillermo Perez, who travels each week from Almirante in Bocas Del Toro. CSS pays Guillermo’s bus fare, hotel and food bills while he undergoes his three, weekly treatments. The problem is that Bocas Del Toro does not have a treatment center and Guillermo has been making this journey for a year and a half. Clearly CSS needs to build added treatment centers in all of Panama’s major population centers. As a journalist I have traveled extensively throughout Latin America and have visited many private and public hospitals. I was able to assure the nurses and staff that they should feel proud as this was the best public hospital I had ever seen.

Clearly overstretched and under-funded, the CSS still struggles on. But, if judging a nation by how well it treats its less fortunate, then Panama can indeed call itself a "great" nation.

Reader’s Letter

Veterans Day ceremony at Corozal Cemetery

The Editor
Dear Sir

This is a cry for assistance for a most important event: The Veterans' Day Ceremony at Corozal Cemetary on Sunday 11 November, 2007.

This year's ceremony will be unique compared to past ceremonies. We have decided to honor all World War Two (WWII) veterans rather than just one person. I need your help to get the message out to as many of our WWII veterans as possible. Any WWII veterans who would like to participate and be honored are encouraged to do so. Here is what I need from those that would like to participate: Name, rank, dates served, campaign(s) and highest decorations to include the Purple Heart. Since all of this information has to fit on one page we might have to edit to make it fit depending on how many honorees we have.

There will be reserved seating for the veteran and his wife. Ambassador Eaton will make the remarks and Col. Pete Oliver; Defense Attaché will recognize the guests of honor and read the Presidential Proclamation.

If you have anyone who would like to participate please ask them to contact Ed Lesesne at 232-5163 or 6669-4003 or send the information to edlesesne@hotmail.com

Your cooperation in this most important ceremony will be greatly appreciated

LTC Edward R. Lesesne, USA (SF) RET.
Commander,
Department Latin America/Caribbean,
Veterans of Foreign Wars of the United States