Products from Panama have become a popular choice for exporters of agricultural products. Its low duty-free trade rate, combined with its lack of trade restrictions on agricultural products (including wheat and corn), has made Panama an attractive destination for farmers, traders, middlemen, and manufacturers. Besides, Panama’s relative isolation from neighboring countries has kept the cost of living and import costs of many goods relatively low. Because Panama’s total imports are less than those of all other South American countries – Combined – and its exports are similar to those of China and India, it is easy for exporters to sell products at a premium to gain a foothold in the country.
A primary reason for the attraction of exporting goods from Panama to the United States is its proximity. The Panama Canal divides the North and South Americas and permits ocean traffic between the two. The United States, Europe, and Asia all have ports on the Pacific side of Panama. As a result, goods exporting from Panama to the United States can reach customers throughout the world and, in some cases, reach markets that would be difficult or even impossible to reach without a port of call within Panama.