Nation at a Glance - Panama

History

Explored and settled by the Spanish in the 16th century, Panama broke with Spain in 1821 and joined a union of Colombia, Ecuador, and Venezuela - named the Republic of Gran Colombia. When the latter dissolved in 1830, Panama remained part of Colombia. With US backing, Panama seceded from Colombia in 1903 and promptly signed a treaty with the US allowing for the construction of a canal and US sovereignty over a strip of land on either side of the structure (the Panama Canal Zone). The Panama Canal was built by the US Army Corps of Engineers between 1904 and 1914. In 1977, an agreement was signed for the complete transfer of the Canal from the US to Panama by the end of the century. Certain portions of the Zone and increasing responsibility over the Canal were turned over in the subsequent decades. With US help, dictator Manuel NORIEGA was deposed in 1989. The entire Panama Canal, the area supporting the Canal, and remaining US military bases were transferred to Panama by the end of 1999. An ambitious expansion project to more than double the Canal's capacity - by allowing for more Canal transits and larger ships - was carried out between 2007 and 2016.

Location: Central America, bordering both the Caribbean Sea and the North Pacific Ocean, between Colombia and Costa Rica

Border Countries: Colombia 339 km, Costa Rica 348 km

Total Area: 75,420 sq km Land: 74,340 sq km Water: 1,080 sq km

Climate: Tropical maritime; hot, humid, cloudy; prolonged rainy season (May to January), short dry season (January to May)

Terrain: Interior mostly steep, rugged mountains with dissected, upland plains; coastal plains with rolling hills

Natural resources: Copper, mahogany forests, shrimp, hydropower

Land use: Agricultural land: 30.5% arable land 7.3%; permanent crops 2.5%; permanent pasture 20.7% Forest: 43.6% Other: 25.9% (2011 est.)

Ethnic groups: Mestizo (mixed Amerindian and white) 65%, Native American 12.3% (Ngabe 7.6%, Kuna 2.4%, Embera 0.9%, Bugle 0.8%, Other 0.4%, Unspecified 0.2%), Black or African descent 9.2%, Mulatto 6.8%, White 6.7% (2010 est.)

Languages: Spanish (official), Indigenous languages (including Ngabere (or Guaymi), Buglere, Kuna, Embera, Wounaan, Naso (or Teribe), and Bri Bri), Panamanian English Creole (similar to Jamaican English Creole; a mixture of English and Spanish with elements of Ngabere; also known as Guari Guari and Colon Creole), English, Chinese (Yue and Hakka), Arabic, French Creole, Other (Yiddish, Hebrew, Korean, Japanese)

Religions: Roman Catholic 85%, Protestant 15%

Population: 3,705,246 (July 2016 est.)

Literacy: 95%; Male: 95.7%; Female: 94.4% (2015 est.)

Administrative divisions: 10 provinces (provincias, singular - provincia) and 3 indigenous territories* (comarcas); Bocas del Toro, Chiriqui, Cocle, Colon, Darien, Embera-Wounaan*, Herrera, Kuna Yala*, Los Santos, Ngobe-Bugle*, Panama, Panama Oeste, Veraguas

Economy: Panama's dollar-based economy rests primarily on a well-developed services sector that accounts for more than three-quarters of GDP. Services include operating the Panama Canal, logistics, banking, the Colon Free Trade Zone, insurance, container ports, flagship registry, and tourism. Panama's transportation and logistics services sectors, along with infrastructure development projects, have boosted economic growth; however, public debt surpassed $32 billion in 2015 because of excessive government spending and public works projects. The US-Panama Trade Promotion Agreement was approved by Congress and signed into law in October 2011, and entered into force in October 2012.Growth will be bolstered by the Panama Canal expansion project that began in 2007 and is estimated to be completed by 2016 at a cost of $5.3 billion - about 10-15% of current GDP. The expansion project will more than double the Canal's capacity, enabling it to accommodate ships that are too large to traverse the existing canal. The US and China are the top users of the Canal. In 2014, Panama completed a metro system in Panama City, valued at $1.2 billion.Strong economic performance has not translated into broadly shared prosperity, as Panama has the second worst income distribution in Latin America. About one-fourth of the population lives in poverty; however, from 2006 to 2012 poverty was reduced by 10 percentage points.

Agriculture - products: Bananas, rice, corn, coffee, sugarcane, vegetables; livestock; shrimp

Industries: Construction, brewing, cement and other construction materials, sugar milling