Special Incentive Legislation Panama is entering the twenty first century with the commitment to an open economy, and the steps have already been taken for the approval and modifications of several laws to comply with the requirements of a new economic policy, designed to fit the needs of an ever-changing market and the processes of globalization, privatization and foreign investment promotion. Panama has recently approved the most modern tourism investment incentive Law in Latin America, and has enacted more than forty laws with tax and fiscal incentives for investments in manufacturing, mining,, reinsurance, banking, petroleum, free zones, exports, reforestation, insurance, infrastructure and others of a similar nature. Panama has signed bilateral preferential trade agreements with Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua. It has also signed investment guarantee agreements with the United States, England, France, Germany, Switzerland, Argentina, Chile, China and with the Multilateral Investment Guarantee Agency. For many decades, Panama has emphasized the internationalization of its economy and has continued to grow and prosper as a site for business locations, especially multinational companies which currently includes Phillip Morris, Gulf Oil, Exxon Corp., Xerox Corp., Kraft Foods, Inc., Sears and many more.
Japan is the largest investor from Asia.
Panama's vibrant services sector is what distinguishes its economy from its Central and South American neighbors. Panama has signed investment guarantee agreements with the United States, England, France, Germany, Switzerland, China and recently with the MIGA from the World Bank. Several tax and financial incentives are offered to foreign and local investors for manufacturing industries, export-oriented ventures and tourism development. To support all of these development efforts Panama recently signed open skies agreements with the US, Holland and Peru. The Colon Free Zone is at present more than a traditional free trade zone.