Nearly half of all foreign tourists are in direct transit and a quarter visits Panama for recreation.

Average expenditures differ significantly across tourist types. According to the national accounts, they range from around US$200 per person per trip for transit tourists to more than three times that amount for recreation tourists (Table 3 and Appendix Table A7). Recent data from TSA surveys are broadly consistent with the national accounts. Average expenditures per tourist are on average US$549 per person per trip compared to the slightly lower average from the national accounts. The latest round of TSA data for tourists in direct transit is not yet available, so the TSA data are representative of recreation, business and other types of tourism and not of direct and indirect transit passengers. Since survey results are regarded as a more accurate measure of tourist expenditures, these findings suggest that the national accounts may overestimate expenditures by recreation tourists and underestimate business tourists’ expenditures.

|**Table 3. Foreign**|**Tourists in Pa**<br>**Data fr**<br>|**nama: Num**<br>**om the Natio**<br>|**ber of Visitors**<br>**nal Accounts (20**<br>|**and Expen**<br>**06)**<br>|**ditures in 2006**<br>**Estimates fr**<br>**Tourism S**<br>|**om TSA**<br>**urveys**<br>|
|---|---|---|---|---|---|---|
||Number of<br>People|Percent of<br>All<br>Tourists|Total<br>Expenditures,<br>US$’000|US$/Trip|Percent of all<br>Tourists|US$/Trip|
|Recreation|569,323|24%|409,947|720|63%|509|
|Business|309,993|13%|151,859|490|21%|767|
|Transit (indirect)|312,004|13%|54,598|175|6%|226|
|Transit (direct)|1,140,430|48%|313,481|275|na|na|
|Other|54,160|2%|30,182|557|10%|536|
|All tourists|2,385,910||960,067|402|100%|549|

_Note:_ Expenditures in the national accounts and the survey data in this table exclude the cost of international travel by air and land.

_Source:_ Authors’ estimates. National accounts data for 2006 are based on the extrapolation of historic trends (not survey-based); TSA data from tourism surveys (2007–08).

Data on tourists’ expenditures from TSA surveys, which are based on a sample of 1,626 foreign tourists, are scaled up to the national level, taking the total number of foreign tourists—1,245,480 tourists excluding direct transit visitors—as given (Table 3). On aggregate, the largest single expenditure items are lodging and hotel expenses and personal shopping, apart from the cost of international travel (Appendix Table A6). Total expenditures for foreign tourists from the survey data are allocated to each province using the information on the share of time (the number of days) each tourist spent at each destination.<sup>15</sup> For domestic tourists—or Panamanian residents that travel within

> 15 Database on foreign tourists’ expenditures includes expenditures for all destinations and information on which destinations tourists visited on the same trip, but no information on expenditures by destination. The estimation of expenditures by province is done here using two methods. First, total expenditures are disaggregated by province in the same proportion as the share of time (the number of days) all tourists in the sample spend in each province. An adjustment is made for a slightly higher level of average spending by tourists that visit only Panama and Colon. This is the lower bound on the estimate of total expenditures by province reported in Table 4. Thus, this approach takes the total aggregate expenditures by all tourists in the sample and allocates them to each province in the same proportion as the share of time spent in each

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