Information Technology in Panama

Welcome to the Landscape of Information Technology in Panama











This web site is created as part of the Impacts of National Technology Environment on Business (INITEB) class. This class is part of the Management of Global Information Technology (MOGIT) at the Kogod School of Business.

The web site seeks to present an IT assesssment of Panama. It looks at several important topics including: National Strenghts and Weaknesses, Size of the Domestic IT Market, National ICT Policies, Telecommunication Infrastructure and Regulation, Computing and INternet Diffusion, Electronic Commerce and E-Business, Domestic Production, IT Workforce, IT Geographics, IT Financing, and E-Government. These topics can be found on the navigation bar to your left.

In each of the above mentioned pages you will find specific data regarding the topic, and and analysis section that provides a discussion and assesment of the data.

It is important to acknowledge the difficulty in gathering information and the fact that links to electronic sources may become unavailable in the near future. For this reason, in the sources page, you will find the name of the electronic source followed by the specific link.

Overview of Information Technology in Panama

Panama is a relatively small country, with a population of about three million people. Although Panama has strong economic sectors, about 37% of the population lives below poverty. The country is 78,200 sq km (somewhat smaller than South Carolina), and borders with Colombia and Costa Rica.

Many people around the world only associate Panamá with the Panamá Canal, but recently an increasing number of individuals have learned more about Panama through world wide media coverage, as a result of hosting the Miss Universe Pageant in 2003, and this year's showcase of Panamá's Pearl Islands in the show "Survivor." Although such publicity is of limited economic importance in itself, it could benefit the country by showcasing Panamá as an attractive vacation destination, and as a result helping the tourism sector.

This report seeks to inform the reader in a much more important area, the area of Information and Communications Technology (ICT). Development in ICT areas is crucial for countries like Panamá, because it can a driver of economic development, and a tool for social development.

Currently, Panamá's infrastructure is relatively well developed, especially after the telecommunications market was privatized. The new telecommunications provider (Cable and Wireless entered the market in 1997) has invested significantly to improve the telecommunications infrastructure. The market was de-regulated at the beginning of 2003, providing Panamanians with more choices for national and international telephone service. However, Cable and Wireless remains the sole provider of local service.

This year, the government has implemented its "E-Panamá Plan". Its main objective is to incorporate information and telecommunications technology in order to aid in the development of the country both socially, and economically. And by doing so, the government also seeks to create an increase in the participation of the population in issues of national importance. The Panamanian government also is in the process of formally setting up the Panamá-Pacific Special Economic Area, located in the former Howard military base, its concept is to establish a "technology park" in the country. The new plan has already attracted Dell Computers, which has already established itself in Howard with a call center that employs about 1,000 individuals, with monthly salaries of $500-600. (1)

The Panamá-Pacific Special Economic Area is expected to create about 3,000 jobs in the first three years. And the International Finance Corporation (IFC) has estimated that, in a time frame of 20 years, up to 55,000 jobs could be created and about $600 million invested in the area. (2)

As of, December 9th, the law that would formally create the area has not been passed, and the contract with the World Bank will expire on December 31st. The delay is a result of increasing pressure from the Colón Free Zone interest groups (ZLC-Zona Libre de Colón), who claim that the Howard Area will create immense economic disadvantage for the ZLC, and give an unfair advantage to the companies that will establish themselves in Howard. In practice, the companies that would be housed in Howard, are be high-tech companies and would not focus in the same type of business as the ZLC's companies. Although the ZLC's grievances should be taken into consideration, it would be very unfortunate for this area not to be developed, because of extended negotiations with this interest group.

Finally, the report examines, analyses, and assesses the ICT areas discussed above, and others, in greater detail in order to give the reader a comprehensive view of the topic.

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