Panama Business: Greetings and Courtesies
Handshakes are appropriate among businesspeople, both men and women, when arriving and leaving; casual acquaintances generally nod when meeting, while good friends hug. Panamanian women may embrace lightly or brush cheeks in a kiss; they seldom shake hands with each other, although they may do so in a business situation. Panamanian find titles important: Se ñor (Mister) and Se ñora (Ms.) as general titles; Licenciado (university degree); Ingeniero (male engineer), and Doctor (lawyer, or someone with an advanced degree).
Panama Business: Ethic and Framework
Panamanians are generally considered relaxed, easygoing, and informal by Latin American standards, although they nevertheless have a regard for formal dignity and hierarchical and class distinctions. Although they have become more accustomed to North American business norms, their values continue to emphasize the importance of personal relationships, and they still take time and effort to establish a personal relationship before a business relationship.
Because of its important location in international trade, Panamanian-born citizens represent almost all of the world's cultures and religions. Often referred to as a "melting pot" of races, like the Panamanian national dish sancocho , all of the different ingredients retain their own distinct identity while adding flavor to the whole dish. There is no racial hatred; perhaps the clue lies in the mixing of the population. You will find every nuance of skin colors and races, including blacks descended from freed or escaped slaves (Cimarrones ); South Americans, Japanese, and Chinese; merchants and immigrants from Europe, Hindus, etc.
Panama Business: Decision Making
Business is conducted among friends in Panama. Authority is rather narrowly concentrated, and actual decisions are almost always made at a high level. Cultivate relationships at all levels, however, because the quality of these relationships may strongly influence the actual decision maker, even when your immediate counterpart is not the one making the decision. Expect negotiations to take time. Many business travelers find that they need to make several visits to Panama before a deal is finally completed.
Panama Business: Meetings
Although punctuality is not important in social situations, Panamanian businesses run on a time schedule. Appointments, especially those with foreign business travelers, are always on time. After initial, more formal introductions, many meetings are held informally over coffee or light snacks; this is often done away from the office setting. Have your business cards and any presentation materials printed in Spanish as well as English.
Panama Business: Entertaining
Since many Panamanians still take a noon break, or siesta, entertaining for business normally occurs over dinner rather than during lunch. Dinners are relatively small (like a supper), often just soup and salad served with bread and rice and fresh fruit. Rice is a staple in Panamanian cooking and is served with every meal. The soup may be made with rice and vegetables (guacho ) or with rice and chicken (sanchoco ) or rice and fish (sanpesco ). International foods are very popular among businesspeople. A refreshing drink (Chica ) made from fresh fruit, water, sugar, and ice is very popular. Coffee usually follows the meal.
Individual plates and bowls of food are brought to the table, and hosts always make sure that their guests are served first. Food for seconds (such as a tureen of soup) is placed on the table. The spoon is used more than fork or knife. Hands are kept above the table and conversation while eating is kept to "light" topics such as sports, favorite foods, the weather, and what people would do if they win the very popular national lottery. You may be entertained during the meal by musicians singing traditional Tipico songs of love and life sung with a Caribbean/African beat.
Do not be surprised if you are invited to a dinner at your host's home. Panamanians are open and informal with their guests; this informality includes certain "rules" that the business traveler needs to know. Your host will not tell you when the visit will end because that implies that his time is more valuable than yours. Also, be prepared for pampering. Offers to "pitch in" by setting the table or washing up are viewed as criticisms of your host's hospitality. Expect to be served first, to get the best of everything, and even to be given a good-bye gift for coming to visit. Instead of giving your host a gift when invited to dinner, you are expected to invite your host to a dinner in return.
Let your hotel or restaurant arrange everything for a business dinner. Larger parties may have a service charge added to their bill, but an additional tip of 5 to 10 percent is given for good service. Because Panama has such a mix of races, larger cities have a wide variety of restaurants featuring international cuisine. Don't forget the gifts for your guests. Thoughtful, personal gifts are valued more than expensive ones.
Panama Business: Attire
Due to the tropical climate, one is well advised to stick to lightweight natural fabrics such as linen and cotton. Men should wear a suit and tie, although your Panamanian host will likely relieve you of your misery by suggesting you remove your coat. Women will do well with lightweight dresses and suits.
Panama Business Advisory
Politics and Graft
The current Panamanian government came into power on a platform promising the eradication of corruption in government. As the international watchdog group Transparency International notes, that task is not an easy one. As they note in a recent report:
"Typically, the main activities in need of reform are those that involve discretion, including the issuance of licenses, permits, quantitative import restrictions (quotas), passports, customs and border-crossing documentation, and banking licenses; the implementation of price controls; the blocking of entry to new firms and investors and the provision of monopoly power; the awarding of public procurement contracts; the granting of subsidies, soft credits, tax exemptions, and inflated pensions and the allowing of tax evasion; the imposition of foreign-exchange controls resulting in multiple exchange rates, the over-invoicing of imports, and the flight of capital; the allocation of real estate, grain storage facilities, telecommunications, and power infrastructure; the discretionary application of socially desirable regulations such as those that apply to public health and the environment; and the maintenance of obscure or secret budgetary accounts as well as other leakages from the budget to private accounts."
Business Fraud
The potential for a fraudulent business deal is just as high in Panama City as it is in any major international city. For this reason, businesspeople in Panama stress the importance of cultivating a business relationship on a long-term personal basis. There is, of course, no guarantee that knowing about a person's hobbies, wife, and family will in any way better enable one to determine how truthful a potential business contact may be, or if he is only interested in the "fast buck."
Do your homework. Examine everything carefully. Have a representative, agent, or lawyer on-site in Panama who can assist you with many little problems before they become big ones. To the outside observer, the court process in Panama is somewhat capricious, and there is often little hope that losses will be covered. |
