Panama

Panama, officially the Republic of Panama, is a country at the southern end of Central America in North America, bordering South America. It shares its borders with Costa Rica to the west and Colombia to the southeast, with the Caribbean Sea to the north and the Pacific Ocean to the south. The capital and largest city is Panama City, home to nearly half of the country's over 4 million people.

Before Spanish colonists arrived in the 16th century, Panama was home to many different Indigenous peoples. It broke away from Spain in 1821 and joined the Republic of Gran Colombia, which included Nueva Granada, Ecuador, and Venezuela. After Gran Colombia dissolved in 1831, Panama became part of Colombia. With support from the United States, Panama became independent from Colombia in 1903, which allowed the construction of the Panama Canal. The canal was completed by the United States Army Corps of Engineers between 1904 and 1914. Later, the 1977 Torrijos–Carter Treaties agreed to transfer the canal to Panama, which happened on December 31, 1999.

Today, Panama's economy is strong, with revenue from canal tolls playing a big role. The country also benefits from commerce, banking, and tourism. Panama's jungles cover about 40 percent of the land and are filled with many plants and animals, some of which are found nowhere else on Earth. Panama is also a founding member of many important international groups, such as the United Nations, the Organization of American States, and the World Health Organization.

Etymology

The name "Panama" has several possible origins. One idea is that it comes from a tree called the Panama tree, which is special to the country. Another idea is that it comes from a word in the Guna language meaning "far away."

There is also a story that "Panamá" was the name of a fishing village where Spanish explorers arrived. They thought it meant "abundance of fish." Later, this became the spot where Panama City was founded.

History

Pre-Columbian period

The Isthmus of Panama was formed about three million years ago, connecting North and South America. This land bridge allowed plants and animals to move between the two continents.

Early people in Panama made some of the first pottery in the Americas around 2500–1700 BC. They created beautiful pottery and large stone sculptures. Before Europeans arrived, many different groups lived there, speaking various languages.

Conquest to 1799

In 1501, a Spanish explorer named Rodrigo de Bastidas was the first European to explore Panama. Soon after, Christopher Columbus visited and made a short-lived settlement. In 1513, Vasco Núñez de Balboa crossed the isthmus and discovered the Pacific Ocean, showing it was the path between the seas. Panama became an important crossroads for Spain’s empire in the New World. Gold and silver from South America were brought across the isthmus to be shipped to Spain.

1800s

When the Spanish American wars of independence began, Panama prepared to join. In 1821, the people of a town called Azuero declared independence from Spain, influencing others to follow. This led to Panama becoming part of Gran Colombia and later the Republic of New Granada.

Independence to 1968

Panama tried many times to separate from Colombia. In 1903, with help from the United States, Panama became independent. The United States built the Panama Canal, completing it in 1914.

Military dictatorship

In 1968, a military coup overthrew the president. The military ruled for many years, making changes to the government and society. There were struggles and protests during this time.

Post-intervention era

After the United States’ intervention in 1989, Panama moved back to civilian rule. New leaders worked to improve the country, focusing on transparency and social programs. Leaders like Mireya Moscoso and Martin Torrijos aimed to make government more honest and help people, especially children and families.

Panama continued to elect new presidents, with changes in leadership through votes. Recent years have included handling challenges like the COVID-19 pandemic and protests. In 2024, José Raúl Mulino became the new president.

Geography

Main article: Geography of Panama

See also: Geology of Panama

Panama is in Central America, touching both the Caribbean Sea and the Pacific Ocean. It is between Colombia and Costa Rica. Panama sits on a narrow strip of land called the Isthmus of Panama, which is very important because it has the Panama Canal. This canal connects the Atlantic Ocean to the Pacific Ocean.

Panama has many mountains and hills running down the middle. The highest point is Volcán Barú, which is over 3,400 meters tall. There is also a thick jungle area called the Darién Gap between Panama and Colombia. Panama has many rivers, and one of them, the Río Chagres, helps create a big lake that is part of the Panama Canal.

Waterways

Panama has almost 500 rivers. One important river is the Río Chagres, which flows into a large artificial lake called Gatun Lake. This lake is part of the Panama Canal. Another river, the Río Chepo, helps provide power for the area.

Harbors

The Caribbean coast has several natural harbors. Two very busy ports are at each end of the Panama Canal: the Port of Cristóbal and the Port of Balboa. These ports handle many ships and cargo.

Climate

Main article: Climate of Panama

Panama has a tropical climate, which means it is usually warm and humid all year. Temperatures don’t change much, and it often rains a lot, especially from April to December. It rains more on the Caribbean side than on the Pacific side.

Biodiversity

Panama’s warm, wet climate helps many plants and animals live there. Forests cover much of the land, but some areas are being cleared for farming and other uses. Panama has many national parks, including Soberanía National Park, which has many different kinds of birds and animals. Darien National Park is very large and is a special protected area. There is also a festival each year to help protect the Harlequin Frog, which is in danger because of loss of habitat.

Government and politics

Main article: Politics of Panama

See also: Elections in Panama

José Raúl Mulino
President

Vacant
Vice President

Panama has a system where the president is both the leader of the country and the head of the government. People aged 18 and older can vote in elections that happen every five years. The country has a group of leaders called the National Assembly that helps make laws. Panama has many smaller political groups along with two bigger ones.

Since 1989, Panama has peacefully changed leaders many times. The country works closely with the United States on many projects. Panama works with other countries to keep the area safe and peaceful. Instead of having a big army, Panama uses police and security forces to keep order and help with safety. These forces work with other countries, like the United States, to protect the region.

Economy

Main article: Economy of Panama

As of 2025, Panama had a GDP of 90.41 billion USD. This means each person in Panama earned about 19,800 USD on average. In 2025, about 8% of people in Panama did not have jobs, which is more than the 2.7% in 2012. Panama’s economy has grown quickly, with the amount of goods and services increasing by over 10.4% each year from 2006 to 2008. It is one of the fastest-growing economies in Latin America. In 2025, Panama was the second fastest-growing economy in the region.

Panama ranked 59th on the Human Development Index in 2025. Even though Panama is a high-income country, there are still big differences in how people live, especially in education. Between 2015 and 2017, the number of people living on less than US$5.5 a day dropped from 15.4% to about 14.1%.

As of 2025, Panama’s total debt was 59.6% of its GDP. In 2024, Panama sold goods worth 37.37 billion USD to other countries, which is more than the 35.71 billion USD sold in 2022.

Economic sectors

Panama’s economy depends a lot on services like shopping, tourism, and trading because of its special location. The Panama Canal, which is very important for shipping, adds 7.7% to Panama’s GDP and helps bring in at least 20% of the government’s money.

Panama also gets resources like copper, mahogany wood, shrimp, and uses hydropower.

Panama as a tax haven

Since the early 1900s, Panama has built a big financial center with more money than three times its GDP. Over 24,000 people work in the banking sector. Panama has worked to follow international rules and improve its financial system since 2016. It is no longer on some important “gray lists” of places with loose tax rules.

Transportation

Main article: Transport in Panama

Panama has Tocumen International Airport, the biggest airport in Central America. It is where Copa Airlines, Panama’s main airline, operates. There are also over 60 smaller airfields. Roads in Panama are generally safe, but driving at night can be hard in some places. Cars drive on the right side, and everyone must wear seat belts. The Pan-American Highway goes from north to south through Panama.

In Panama City, there are many bus routes and a Panama Metro with two lines.

Tourism

Main article: Tourism in Panama

In 2025, more than two million tourists visited Panama. In just one month, August 2025, over 194,000 visitors came. Many tourists come on cruise ships; in 2023, about 320,000 visitors arrived this way. The most visitors come from the United States, Colombia, Venezuela, Ecuador, Brazil, and Spain.

Tourism keeps growing in Panama. In 2023, it brought in over 5.4 billion USD, which is 20% more than in 2019. In 2012, tourism added 4.585 billion USD to Panama’s economy and made up 11.34% of the country’s total goods and services.

Panama has special rules to help visitors and people who want to live there. In 2012, Panama made a law to help bring in more tourism money.

Currency

The money used in Panama is called the balboa, which is worth the same as the United States dollar. People use US dollars for big payments, and Panama has its own coins, but US coins are also used. Panama’s money has stayed stable because it uses US dollars.

International trade

Panama trades a lot because of the Colón Free Trade Zone, the biggest free trade area in the Western Hemisphere. In 2024, goods worth 24.7 billion USD moved through this zone.

Panama also sells things like coffee, bananas, palm oil, cane sugar, and shrimp. The biggest export is copper ore, worth 3 billion USD in 2022.

Panama has agreements to help its trade with the United States, which make it easier for both countries to do business together.

Demographics

Main article: Demographics of Panama

In 2025, Panama had an estimated population of 4,600,000 people. This is more than in 2021, when the population was 4,351,267. Most people in Panama live in cities, with over 75 percent living in urban areas. The biggest city is Panama City, where many people live together in a group of nearby towns.

Largest cities

Main article: List of cities in Panama

These are the 10 largest cities and towns in Panama. Many of them are part of the Panama City area.

Ethnic groups

In 2010, most people in Panama were of mixed background, called Mestizo. There are also Indigenous groups, people of African descent, and others. By 2023, more people identified as Indigenous.

The Indigenous groups include the Ngäbe, Guna, Emberá, Buglé, Wounaan, Naso Tjërdi, and Bri Bri.

Languages

Spanish is the main language spoken in Panama. Many people also speak English, especially in jobs that need it. Some people still speak their own Indigenous languages. A small number speak other languages like French or Arabic.

Religion

Main article: Religion in Panama

Most people in Panama are Christian. Many are Roman Catholic, and others are Protestant. There are also smaller groups like Jehovah’s Witnesses, Mormons, Buddhists, and Jewish people. Some Indigenous groups have their own religious traditions.

Education

Main article: Education in Panama

Education in Panama started a long time ago. Today, children must go to school from ages 6 to 15. Most people can read and write. Schools have been getting better over the years.

Culture

Main article: Culture of Panama

See also: Music of Panama and Mass media in Panama

Panama's culture comes from the traditions and arts brought by Spanish people. Over time, it has mixed with African and Indigenous Panamanian traditions. One example is the tamborito, a Spanish dance that uses African rhythms and moves.

Dance is important in Panama, and you can see many dances at festivals. Cities often have live music, including reggae in Spanish, reggaeton, jazz, blues, salsa, and rock.

Holidays and festivities

Main article: Public holidays in Panama

In Panama City, people celebrate Christmas with a special parade called El desfile de Navidad. They decorate floats in Panamanian colors, and people dress in traditional clothes. There is also a big Christmas tree lighting, and everyone sings carols together.

Literature

Stories about Panama began in 1535. Later, writers started creating their own stories, often inspired by the Panama Canal and how it changed the country.

Handicraft

In villages, people make traditional crafts like woodcarvings, masks, and pottery. The Guna people are known for their beautiful molas, colorful designs made by women on special clothing.

Clothing

Men in Panama often wear white shirts, short pants, and straw hats. Women’s traditional dress is called a pollera. It is a long, fancy dress with lots of decorations. Today, people sometimes wear these clothes during parades and festivals.

Cuisine

Panama’s food comes from many places, including Spanish, Indigenous, and African influences. The country has many tropical fruits and vegetables. Popular foods include fresh seafood, ceviche, and pastries like empanadas and pastelitos. Common ingredients are corn, rice, wheat, plantains, yuca, beef, chicken, pork, and seafood.

Sports

Baseball is the most popular sport in Panama. Many Panamanian players have joined teams in the United States. Football (soccer) is also popular, and Panama’s national team has played in the World Cup. Other sports people enjoy include basketball, volleyball, taekwondo, golf, tennis, triathlon, flag football, American football, rugby, field hockey, softball, skateboarding, BMX, and surfing.