Panama has strategically positioned itself as a regional logistics and manufacturing hub, thanks to its location at the nexus of the Americas, its world-class maritime infrastructure, and its pro-business regulatory framework. The country’s industrial development is supported by a network of industrial parks in Panama that cater to a wide range of sectors, including logistics, manufacturing, food processing, pharmaceuticals, and electronics assembly. These industrial zones benefit from exceptional connectivity, competitive labor costs, and supportive government policies designed to attract foreign direct investment.
Key Industrial Parks in Panama
Some of the most prominent industrial parks in Panama include:
- Panama Pacifico
Located on the western side of the Panama Canal near Panama City, Panama Pacifico is a flagship mixed-use development and one of the most advanced industrial parks in Panama. It offers Class A infrastructure, including high-speed fiber-optic internet, redundant power systems, and logistics platforms designed to streamline distribution to markets across the Americas.
Panama Pacifico is home to global companies such as Dell, BASF, 3M, and Pepsico. It has strong access to the Tocumen International Airport and the Port of Balboa, facilitating efficient air and maritime shipping. Tenants enjoy benefits from Law 41, which includes tax holidays, expedited immigration services, and customs facilitation.
- Zona Libre de Colón (Colón Free Zone)
The Colón Free Zone is one of the largest duty-free zones in the world and a central pillar in Panama’s trade and re-export economy. Located near the Atlantic entrance of the Panama Canal, it primarily serves wholesale trade but also supports light assembly and manufacturing.
The zone’s tenant mix includes companies in electronics, textiles, automotive parts, and consumer goods. It offers 100% duty exemptions on imports and re-exports, along with income tax benefits and streamlined bureaucratic procedures. The area is well connected to the Port of Colón and benefits from dedicated customs facilities
- Panamá Norte Logistics Hub
Situated along the Panama-Colón corridor, this hub includes industrial parks like Parque Industrial Costa del Este and Parque Sur. It caters to logistics and light manufacturing operations and is highly attractive due to its proximity to both the capital and the Caribbean ports.
These industrial parks in Panama have attracted firms in the food distribution, pharmaceutical, and third-party logistics (3PL) sectors. Connectivity is strong via the Corredor Norte and Corredor Sur highways, and costs are competitive with average lease rates ranging from $6 to $9 per square meter per month for Class B and C warehouses.
- Howard Industrial Park
Also located in the Panama Pacifico area, Howard Industrial Park specializes in logistics and manufacturing, particularly for high-tech and aerospace clients. It benefits from its proximity to the former U.S. Howard Air Force Base is now a modern air logistics platform. The park offers ample space for build-to-suit facilities, and companies benefit from on-site customs clearance and bonded warehousing.
- City of Knowledge (Ciudad del Saber)
While not traditionally industrial, Ciudad del Saber is a scientific and technological park that supports innovation and sustainable development. It is particularly attractive for pharmaceutical, biotech, and IT companies. Its clustering of research institutions and partnerships with universities makes it a center for high-skill job creation and training.
Labor Availability, Cost, and Training
Panama boasts a labor force of over 1.7 million, with approximately 30% residing in the Panama City metropolitan area, where most industrial parks are situated. Labor costs are competitive compared to those in the U.S. and Western Europe. Minimum wages vary by sector but average around $2.90 to $3.75 per hour. Skilled labor for manufacturing and logistics is increasingly available in Panama due to the country’s investment in technical training programs.
The National Institute for Professional Training and Education for Human Development (INADEH) offers sector-specific training, including in logistics, welding, machinery operation, and IT. Additionally, partnerships between industrial parks and private technical schools have increased, especially in Panama Pacifico and Colón.
Labor laws in Panama are relatively strict and are governed by the Labor Code. These laws favor worker protection, with clear stipulations for wages, working hours, severance pay, and social security contributions. Union activity is prevalent, particularly in large logistics and manufacturing firms, but remains moderate in scale. Most industrial parks have collective agreements in place that ensure industrial peace.
Infrastructure: Transportation, Utilities, and Energy
One of the defining strengths of industrial parks in Panama is their access to world-class logistics infrastructure. The country is home to the Panama Canal, which handles over 300 million tons of cargo annually. Two major container ports—Balboa (Pacific side) and Colón (Atlantic side)—are among the busiest in Latin America.
The Tocumen International Airport is a regional hub with cargo facilities and direct flights across the Americas and Europe. Highway access via the Inter-American Highway and the Corredor Norte/Sur networks ensures seamless movement of trucks between ports and industrial areas.
Utilities are generally reliable, especially in Panama City and surrounding industrial zones. Electricity costs range from $0.16 to $0.22 per kWh. Water is plentiful and cost-effective, with infrastructure in place for industrial-scale use. Telecommunications are strong, with 4G LTE and high-speed broadband widely available. Fiber-optic services and redundancy systems are particularly prevalent in newer industrial parks, such as Panama Pacifico.
Tax Incentives and Regulatory Environment
Panama is recognized for its ease of doing business and investor-friendly regulatory framework. Special economic regimes govern many industrial parks in Panama, offering tax incentives and other benefits to attract investment. The most notable laws include:
- Law 41 (Panama Pacifico): Offers exemptions on income tax, dividend tax, import/export duties, and VAT.
- Law 32 (Colon Free Zone): Provides full exemption on import/export duties, no income tax on re-export activities, and reduced withholding tax.
- Multinational Headquarters Law (SEM Law): Attracts regional HQs by exempting corporate income tax on foreign-source income and providing visa and work permit benefits.
Panama imposes relatively low corporate income taxes (25%) outside of special zones, and a VAT rate of 7% applies. Environmental regulations exist and are enforced by the Ministry of the Environment, especially for industries with potentially hazardous emissions or waste. However, permitting processes have been streamlined for operators in approved industrial parks.
Real Estate and Operating Costs
Lease rates for industrial space vary depending on the location and class of facility. On average:
- Class A warehouse space: $8–$12/m²/month
- Class B/C facilities: $5–$8/m²/month
- Build-to-suit construction costs: $500–$750/m²
- Facility management services: $0.50–$1.25/m²/month
- Security services: $0.75–$1.50/m²/month
- Waste disposal: $300–$600/month for medium-sized operations
Electricity, water, and telecommunications are billed separately but are predictable and generally stable. Operating costs in industrial parks in Panama are lower than in many Caribbean and South American locations, particularly when factoring in the cost savings from efficient logistics.
Logistics and Freight Costs
Panama’s status as a global logistics hub allows companies to reduce freight costs and delivery times to customers across the Americas. Some average logistics costs include:
- Truck transport (local): $0.15–$0.25 per km
- Container shipping (to U.S. East Coast): $1,200–$1,800 per 40-foot container
- Air freight (to North America): $2.00–$4.50 per kg, depending on volume
- Intermodal transport (Canal to Atlantic ports): Minimal due to proximity
Companies in Colón or Panama Pacifico often benefit from consolidated shipping and bonded logistics services, which enable duty-free transshipment and improved customs efficiencies. Parks near Tocumen Airport or the Port of Balboa also enjoy lower lead times for high-value goods.
Tenant Mix and Cluster Benefits
One of the strategic advantages of industrial parks in Panama is their growing concentration of international tenants, which yields cluster benefits. For instance:
- Panama Pacifico hosts companies in the IT, aerospace, and consumer goods sectors, allowing for the shared use of logistics and training infrastructure.
- Colon Free Zone features businesses in electronics, apparel, and household goods, leading to scale economies in warehousing and customs processes.
- Panama Norte supports 3PLs, food processors, and packaging firms, which benefit from shared cold storage and transport networks.
The track record of these parks in supporting multinational corporations is strong. Government coordination with industrial zones ensures that site development, permitting, and expansion are handled efficiently. As a result, these parks continue to draw investment from Asia, Europe, and North America.
Conclusion
Panama’s industrial park landscape is well-positioned to support modern manufacturing, logistics, and distribution operations. With competitive labor costs, skilled talent, robust infrastructure, and generous fiscal incentives, the country provides an ideal platform for companies seeking access to North and South American markets. The rise of industrial parks in Panama, like Panama Pacifico and the Colón Free Zone, underscores the country’s commitment to becoming the region’s foremost industrial and logistics hub. Whether for light assembly, high-tech manufacturing, or regional distribution, these parks offer the connectivity, talent, and business environment that global companies demand.