Panama Golden Visa & Residency by Investment Programme

Panama has long been a welcoming country to expats from around the world looking for a new permanent residence or second passport. They are famous for offering numerous different residency visas to suit almost anyone’s means and requirements. 

In this article, we will first take a look at their most famous and easy-to-obtain “Friendly Nation’s Visa”. We will then explore the various visas specifically aimed at wealthy investors who might not qualify under the friendly nation’s visa program. This includes both their classic residency by investment visas which have been around for a while, as well as some new programs which have just been introduced. 

Table of Contents:

• Panama Friendly Nations
• Panama’s Classic Residency by Investment Visas
• Panama’s Four New Residency by Investment Programs
• 1. Real Estate Investment
• 2. Real Estate Investment: Promise to Purchase and Sale Agreement
• 3. Fixed Term Bank Deposit
• 4. Panama Stock Market Investment
• Conclusion

Panama Friendly Nations

Panama offers a friendly nations visa and extremely easy and cheap route to permanent residency for anyone from one of 50 “friendly nations”. Citizens of any of these 50 countries can easily acquire residency in Panama by demonstrating economic activity in the country. Simply registering a Panamanian corporation and thereafter making a deposit of $5,000 to $10,000 is usually sufficient to demonstrate economic activity. After obtaining residency you are free to dissolve the corporation and withdraw the money if you please. 

Once the requirements are met, you can submit your residency application and return to Panama a few months later to receive your acceptance documents. This makes Panama possibly the easiest place on earth to obtain permanent residency for anyone from the qualifying nations. 

Furthermore, Panama is one of the few nations which has barely any physical presence requirements to speak of. There is no requirement to actually live in Panama or have a home there to maintain residency. You need only visit Panama once every two years. This makes the Friendly Nations Visa program ideal for those who actually want to immigrate to Panama as well as those who want to stay in their home country and are looking to establish second residency for other reasons (e.g., tax benefits, having a plan B, financial security, etc.). 

Residency by Investment Visas

Panama offers various other visa options for those who are not from one of the qualifying “friendly” nations. The following two relate specifically to acquiring residency by investment:

• Reforestation Investor Visa

Panama offers a reforestation visa, a relatively easy route to residency for those who are willing to invest a minimum of $80,000 in a reforestation project which has been certified by the government. The applicant is also required to hold at least five hectares of titled land to qualify. 

• Business Investor Visa

Qualifying for Panama’s Business Investor Visa requires the applicant to set up a Panamanian corporation with a minimum of $160,000 of paid-up share capital. Thereafter, you will be eligible for a temporary residence permit which can be converted to permanent residency of two years of operating the corporation. It is important that the corporation is an active business, so holding companies or shell companies will not suffice. 

Four New Programs

In late 2020, in an effort to stimulate the economy after the crippling economic effects of Covid-19, Panama introduced four new residency by investment programs. These programs are aimed at attracting wealthy investors who are seeking a fast and easy way to acquire Panamanian permanent residency. 

Panama’s Friendly Nations Visa still remains the cheapest and easiest way to acquire residency for anyone from one of the qualifying countries, so it is likely that these new residency by investment programs are aimed at those who a do not qualify for the friendly nation’s visa. 

Each of the four options have their own set of minimum requirements. However, they are common in that each must be held for at least five years to maintain residency status. Furthermore, each of these programs can enable you to obtain a residency permit in as little as 30 days provided all the requirements have been met. 

Here we will look at the four different options and their qualifying criteria:

1. Real Estate Investment

Under the real estate investment program, you will be eligible to apply for permanent residency as a “qualified investor” after making a minimum investment of $300,000 in Panama real estate. The minimum amount will increase to $500,000 after 16 October 2022. 

The investment funds must be foreign-sourced, and the investment must be held for at least five years. In the case that the value of the property being purchased exceeds the minimum required investment amount, the balance is allowed to be financed with a mortgage from a Panamanian bank or financial institution.

Additional fees include a $5,000 application fee for the primary applicant (plus $1,000 for each dependent), as well as a $5,000 “repatriation deposit” (plus $1,000 for each dependent). The repatriation deposit is refundable if you ever decide to cancel your Panama residency.

2. Real Estate Investment: Promise to Purchase and Sale Agreement

The qualification requirements for this second program are similar to the ordinary real estate investment option, with some additional flexibility. Instead of purchasing real estate upfront, it involves entering a “promise to purchase and sale agreement”. This is effectively the same as a Memorandum of Agreement between the buyer and seller of the property.

In order to qualify, the full investment amount must be deposited into an escrow account in Panama which will later be used to purchase the property in question. This means that, for the applicant, this option is almost identical to the upfront purchase option. The minimum investment amount is also $300,000 ($500,000 after 16 October 2022). All other requirements are identical. 

3. Fixed Term Bank Deposit

The third new residency by investment program involves making a $750,000 fixed-term deposit in a Panamanian bank. As with the previous options, the deposit must be held for at least five years and the funds must be foreign-sourced. All other fees and requirements are the same. 

There are some additional risks involved in keeping such a large sum in a Panamanian bank, as they do not have a properly established deposit insurance scheme. There are also some reputational risks because of Panama’s tag as a “tax haven”. For these reasons, the fixed term bank deposit might not be the best route to go, as well as it being by far the most expensive.

4. Panama Stock Market Investment

The final way to acquire residency by investment in Panama is through a minimum investment of $500,000 in publicly traded stocks via a licensed brokerage firm. This is an ideal choice for those who are looking for a higher liquidity investment option compared to real estate. Once again, the investment must be held for a minimum of five years, after which you are free to trade and sell the stocks as you please. All other fees and requirements are the same as the previous three programs discussed above.

Conclusion

The four new residency by investment programs which Panama has recently rolled out offer interesting new routes for acquiring permanent residence quickly and easily. At the time of writing, either of the two real estate investment options are the cheapest, at a discounted minimum amount of $300,000. Furthermore, real estate has been one of the better investment classes in Panama, and could likely bring the best long-term returns on your investment. For these reasons, it may be the best choice for many.

It is important to note that all of the above options are still far more expensive and strenuous than qualifying for the Panama Friendly Nations Visa. Therefore, if you are a citizen of one of the 50 countries who qualify for the latter, this would still be your best bet. These new options provide a viable alternative for those who do not qualify for the friendly nation’s visa. They have the added benefit that you can potentially generate long-term returns on the investments that you make. 

Residency by Investment programs are constantly changing, and you can never be sure that they will continue indefinitely. While Panama’s new programs don’t look like they are disappearing anytime soon, now would still be the ideal time to act and take advantage of the opportunity presented, especially considering the currently reduced rate.