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Panama, A Prime Retirement Destination

By Juan Carlos Martinez

Worldwide demographics trends indicate that the population is aging and aging quite well. In the past decades medicine, science and social security system advances have increased age expectancy as well as the quality of life after retirement. The result of this is a more mature population which has retired but is still quite active, healthy and fit. These people have a greater participation in all aspects of life and are a large target market with very substantial disposable incomes. This makes them a huge market for tourism as they have the time, the energy, the desire and the income to travel.

retiree

According to information from European demographic studies between 1991 and 2010 the population older than 80 will increase 100%, while the number of people between 65 and 79 years will grow 30%. Other data provided by the United Nations Population Division indicates that currently in developed nations one in five persons is aged 60 or over and by 2050 the number will be one of every three person 60 and over. World life expectancy is currently at 65 years old and by 2050 life expectancy is expected to increase to over 76 years. This creates an interesting market for what is called “retirement tourism “.

The World Tourism Organization on spotting this trend has invited countries who are investing in their tourism industry to create packages and publicity specially geared towards this segment. Thousands of foreigners retire abroad each year. Approximately 80,000 Americans retire in Mexico and according to the Washington Post close to 7 million Americans and Canadians are living abroad.

In Panama there exists a notable advantage for this type of market as many incentives already exist for a retirement age populations such as 50% discount on recreational activities (movies, theaters and public spectacles), 25% in restaurants and hotels, among many others however in spite of this not many tourists in this age segment visit Panama.

Data gathered by the Panama Chamber of Tourism indicates that only 12% of the tourists who enter the country are retirement age and that the average age of tourists is 37. Panama has in general terms geared its tourism strategy towards traditional tourism based on the premise that retirement age people are still active and can participate in normal tourist activities. While this may be true there is a growing segment aged over 70 with disposable incomes from pensions and retirement funds which is looking to retire in a sunny climate. Most likely in a retirement community and is not looking to participate in traditional tourism. They are looking for high quality communities with social areas, golf carts, pools, recreation centers, planned outings and on-site medical facilities. These facilities in the US may have buy in prices of up to US1,400,000 and have monthly costs anywhere from US$1,500 to US$4,000. If you translate these costs to Panama at least the buy in would be greatly reduced due to our less expensive labor, lower medical costs, among others.

Currently many retirees choosing to set up in Panama simply buy a residence and get their “pensionado visa”. Many of them are settling in Boquete, Cerro Azul, El Valle, Altos de Maria, with cooler climates, while others prefer the beaches such as Coronado, Gorgona or the many other choices. There are no established communities for retirees such as those that are in the US, but with the proper marketing and vision from anyone willing to invest, this business potential is here in Panama.

 

 

Copyright© 2011, Pan Am Publishing S.A., Republic of Panama