What should you know about Panama business culture?
Panamanians are generally warm, friendly and talkative. The mixed population includes people of Indo-European descendants known as Mestizos, American Indians, West Indians and Europeans. Hence their business culture is also an eclectic blend of various mannerisms and conduct.
Panamanians speak Spanish at business meetings, so ensure you include someone in your team who knows the language well. Striking a positive note on the personal level is more important to Panamanians than the actual business deal. Likewise, loyalty and trust are highly valued and those closest are guaranteed better success in securing an order or contract.
What are the negotiation tactics to be used in Panama?
- Be on time but forgive the locals if they are late!
- Dress codes are important to them so wear a dark suit for your initial meetings
- Shake hands when you first meet. Embrace once you know each other well
- Get your business cards, documents or presentation translated in Spanish before you present
- Address individuals by their titles, which are dictated by their professions. E.g.: Lawyer – ‘Abogado’, teacher – ‘Professor’ and Ph.D. – ‘Doctor’
- Begin with light conversation. Discuss family, sports and hobbies instead of politics or Panama’s past
- Make sure a senior person is representing your company during the negotiation process as hierarchy is valued
- Blatant refusals are rare. Panamanians may instead say “maybe”, or “let’s decide later”. This usually means a “no”
- Expect it to take at least 2 to 3 meetings before there’s a conclusion to the negotiation
- Women will be shown chivalry so expect doors to be opened and chairs to be pulled out for you
What is a contract worth in Panama?
Temporary or interim agreements in Panama are not to be taken too seriously even if they are in writing. The written contract can be lengthy and inclusive of many details and eventualities. Seek the help of a local lawyer to help you to understand it. A contract is merely a formality in Panama. There is more importance given to the personal connection over a written document, even if it is signed.
What decides the pricing policies in Panama?
Prices levied on commodities in Panama depend on largely on government tariffs. In a free market, it’s difficult to enforce heavy tariffs. This causes rises in price and an evident sector of society that is often deprived.
What are the arbitration and litigation processes like in Panama?
Due to high costs, delays and other uncertainties in the legal processes in Panama, many individuals began utilizing the arbitration process for conflict resolution. Hence arbitration is a more economic, efficient and professional option.
In fact with a new bill in place, Panama aims to be a potential centre for fair and streamlined arbitration processes for local and international cases.
Though the traditional Panamanian may prefer known business allies, the national sentiment actually portrays a positive approach towards foreign investment and trade links. Hence, Panama’s future seems to be looking quite bright from a most business deal.