On September 8, the American Chamber of Commerce filled the grand ballroom at the Hotel Miramar for its fourth annual tourism forum. After opening remarks by US Ambassador Linda Watt in English and IPAT director Rubén Blades in Spanish, there followed a lively panel discussion featuring people who are deeply and directly involved in various facets of Panama’s tourism industry: developer and hotelier Herman Bern, environmental activist Líder Sucre, Tropic Star fishing lodge director Marcos Ostrander, Boquete developer and hotelier Sam Taliaferro, Panamainfo.com publisher Nancy Hanna, travel agency proprietor Franz García de Paredes and Panama Canal Railway Company marketing chief Tom Kenna.
The Blades discourse, which was the only presentation at this event that was given in Spanish, is covered in a separate article, the lead story in this issue’s business section.
Watt’s remarks were mainly in the nature of an enthusiastic booster’s words of encouragement. Describing herself as “Panama’s number one tourist,” Watt recounted experiences ranging from snorkeling on the Bocas del Toro reefs to collecting indigenous baskets from the Darien and all the major tourist activities in between.
The US ambassador had four bits of advice:
• Panama needs to promote its tourist attractions more. “If you don’t get the word out, no one will know.”
• Improve tourism infrastructure, finding a better balance between the public and private roles. In general, Watt sees the dividing line putting most of the physical structures on the private side and most of the human resources --- education for jobs in the tourism industry --- on the public side. On the latter point, she emphasized the teaching of foreign languages, “especially English, but also German and Italian and French and --- why not? --- even Japanese.”
• Boost internal tourism. Now this might have been heresy in a room full of Panamanian entrepreneurs who see Disney World as their Mecca, but Watt said that she’s “shocked” at how many Panamanians don’t know their own country.
• Protect the environment. Watt warned that if foreign visitors come and find our national parks trashed and our wildlife depleted, they won’t come back.
The first of the panelists was the man who owns the ballroom. Herman Bern, proprietor of the Hotel Miramar, the Gamboa Rainforest Resort, the Holiday Inn and the developer of many real estate ventures, gave a “top 10 things that need to be done” Powerpoint presentation. Starting off by asserting that Panamanian tourism is nearly a $1 billion industry that directly and indirectly employs nearly 100,000 people, Bern noted our relative lack of hotel rooms, citing Costa Rica and the Dominican Republic as contrasting examples.
Bern said that, although there is not a huge voter constituency for tourism, it’s important for politicians to believe in national tourism and to adopt long term tourism policies. He advocated a severe downsizing of the IPAT government tourism bureau, which he said should be converted into “a public corporation operating as a private enterprise.” He had especially harsh words about the government’s international promotion campaigns, arguing that one-year funding is inefficient and that in the present set-up too much of the money goes to intermediaries rather than to putting Panama’s message before potential foreign customers.
Bern advocated changes in the basic tourism law, which he called “obsolete,” and --- as should be expected at an AMCHAM gathering --- called for reforms to the Labor Code, particularly by exempting the tourism industry from holiday and weekend pay requirements.
He also called for a general clean-up, decrying the trash along the Trans-Isthmian Highway as “a national shame” and calling for public facilities on the nation’s public beaches.
Bern also called for improved transportation infrastructures --- like a road to Kuna Yala and better airport facilities in the Perlas Islands --- and improved public education at all levels.
Finally, he criticized a number of government policies, from wrong locations for garbage dumps to imprudently granted commercial fishing licenses to “scandalous pardons of convicted terrorists.”
The next Panelist was Líder Sucre, the Ivy League educated head of Panama’s wealthiest environmentalist groups, the National Association for the Conservation of Nature (ANCON). His talk centered on the phenomenon of nature tourism.
Pointing out that people who travel to appreciate nature tend to be wealthier than the average tourist, Sucre added that studies of the US market also indicate that this segment of travelers includes those Americans most likely to travel outside the United States. In the past few years, when international tensions have kept many Americans at home, this becomes an important marketing consideration.
Sucre pointed to tiny Belize as a country that has few people but some nice coral reefs and relatively intact forests, and thus has staked its economic development on nature tourism, which accounts for some 12 percent of the Belizean economy.
In Costa Rica, Sucre pointed out, nature tourism has surpassed coffee and bananas as a foreign exchange earner --- and with fewer biological resources that Panama has upon which to base that tourist sector.
What would you expect the leader of ANCON to say? Sucre warned of deforestation and the degradation of our aquatic and marine resources. He argued that an increased dollar income for the tourism sector “masks the fact that volume has decreased.”
But on the positive side, Sucre noted the outpouring of public support and participation in the political brawl the led to the defeat of Mireya Moscoso’s plan to build a road from Boquete to Cerro Punta, past property that she and her relatives own and through the Volcan Baru National Park. “The extraordinary thing is how hard we had to fight.”
Marcos Ostrander, who is prominent in many spheres of Panamanian life (not the least of which is in freemasonry), has had a hand in the formation of this country’s tourism laws, a role in the annual Ocean-to-Ocean Cayuco Race and, most important for this setting, is director of this country’s original eco-tourism success, the Tropic Star Lodge on Piñas Bay. His talk concentrated on the threats to Panama’s sports fishery.
Setting the context first, Ostrander noted that “we don’t just need to protect Panama’s seas, we need to protect the world’s oceans. In this time of collapsing world fisheries, he warned, we’d better protect the Gulf of Panama or else our country’s name --- “Panama” derives from an indigenous word for “abundance of fish” --- will become anachronistic.
Ostrander reviewed the legislation designed to protect our sports fishery and pointed to a culture that protects the resource. “We haven’t had a tournament in Panama where a billfish was killed in years --- they’re all catch and release.”
But not so with the longliners and purse seiners, most of them from outside Panama, that fish our waters, including by poaching in the supposedly protected waters around Piñas Bay. He illustrated the point with a series of Powerpoint projections of such abuses, including mass kills of sailfish even though these important sports fish have no commercial value.
Ostrander hailed the new law protecting Coiba Island and its surrounding waters, and argued that public education must play an important role alongside legal protections.
Mostly, however, he urged that “we need good enforcement of the laws.” In particular, Ostrander called for the dedication of sufficient law enforcement resources to prevent “foreign vessels from coming in to rape the seas.”
Next to speak was Sam Taliaferro, the developer of the Valle Escondido residential project in Boquete and the proprietor of a hotel in the same Chiriqui highlands town. He said that Valle Escondido is now mostly sold out, and told of what he learned in the process of its creation.
But first, he deconstructed the tourism numbers that IPAT likes to bandy about.
Taliaferro immediately distinguished business travelers from tourists as such, noting that a lot of Americans who come down here to do conduct financial or commercial transactions claim on the forms given to them on the airplanes that they are coming for pleasure rather than business because they would rather not create any slip of paper that Uncle Sam’s taxman might later be able to use as evidence against them.
To Taliaferro, the people who are important are the ones who come in, mainly through Tocumen Airport, intending to spend some time in Panama and get to the Interior while doing so. He looked at the 40 or so small hotels in the Interior that advertise on the Internet and their occupancy rates as a rough guide. He thus estimated that about 75,000 couples from North America and Europe, who spend about $75 million per year in Panama, are the core of tourism as he sees it, and that those who stay at the little hotels and pensiones in the Interior make up about 11 percent of this phenomenon.
Then he pointed out that if 1,000 affluent foreign couples retire down here, the amount of money they bring into the national economy dwarfs the revenue generated by more traditional concepts of tourism. It’s not only the money that they spend living down here, but the fact that such retirees attract family and friends to visit, and tend to show them around the country.
“That’s exactly what’s happening in the little town of Boquete,” Taliaferro claimed, adding that if 30,000 retirees relocate here, it will mean an investment in Panama on the order of $6 billion.
So how should that be done? First, Taliaferro said, by the private sector’s wise use of Internet advertising. [Editor’s note: The Panama News HAS to point out that one of ways that Taliaferro sold most of the lots at Valle Escondido was by advertising on this website.]
“I don’t believe that it really is government’s role to promote tourism,” Taliaferro opined. The best thing that the government can do to help, he said, would be to “strengthen the rule of law and curb corruption.”
(Although he did not get into the details during his AMCHAM presentation, Taliaferro’s experiences resisting shakedown attempts by corrupt public officials during the course of developing Valle Escondido have become the stuff of local legend. But if a former local official didn’t get his six-figure payoff, some lawyers got paid to make sure he didn’t.)
Taliaferro would like to see a hotline established to help foreign investors who run into bureaucratic obstacles, and a foreign investor oversight committee to guard against abuses. “If the judges know that they’re being watched,” he argued, there will be a lot more foreign investment in Panama.
The following panelist was the forum’s organizer, Nancy Hanna. As the publisher of Panamainfo.com, she is the only other private website owner in Panama who can credibly argue that she has a bigger English-language readership than The Panama News. She spoke about why Panama has special attractions for Americans.
The top attraction, in Hanna’s opinion, is nature. “Everything we see in Panama is so strange to them, so different,” she noted. And moreover, because we are a world transportation hub, it’s “easy to get to nature.”
Hanna also noted that Panama is one of the safest tourist destinations in the Americas, even if that isn’t generally known.
Then, Hanna pointed out, despite the often bitter struggle for Panama to redeem the former Canal Zone, there’s a long shared history between this country and the United States and it’s generally a positive one. As a result of that history Panamanians and Americans tend to know, understand and like one another. We use the same currency and much of Panama has “American-style infrastructure.” And of course, there’s the canal, which in her opinion has been enhanced as a tourist attraction by the new Miraflores visitors’ center.
Hanna also cited Panama’s pirate history and indigenous cultures as things that fascinate many Americans.
Franz García de Paredes, of Panama Travel Experts Inc, then spoke about “what we are doing right, and what we need to improve.
García de Paredes’s business is providing tours for people who get off of cruise ships here. He noted the gains in cruise ship tourism that Panama has made under the past two presidents, but warned that we could quickly lose cruise ship tourism altogether.
“They will remember,” he said of cruise ship visitors. “But what if their first impression is not a good one?”
For example, if they travel by bus along the Trans-Isthmian Highway, they are likely to notice that the road unsafe and conclude from all the litter that Panamanians are dirty.
That won’t do, García de Paredes argued. “We must be sure that our departing guests feel good about our home.”
He also got into the particulars of business issues he confronts.
Topping that list is the dispute between Colon bus syndicates and the tour operators. Colon has a long-standing grievance about people coming from the Pacific side to get the jobs and contracts, a complaint that often has racial overtones. But to García de Paredes it’s a power struggle between bus syndicates who would offer unclean and unsafe busses and inferior services on a take it or leave it basis on the one hand and the tour companies’ right to choose the best on the other. In this argument Colon authorities have tended to side with the syndicates, insisting that no bus without a Colon permit should be allowed to carry tourists around Colon province. But to García de Paredes it’s a racket: “A government that condones extortion as a means of doing business is doing the country a great disservice,” he argued.
Other points of concern for García de Paredes are the long lines at the canal’s north end (he wants cruise ships to be put at the head of the line) and the poorly maintained road to Fort San Lorenzo (which he suggests might be better were it put in the care of a private foundation).
Finally, he touched upon the price structure for tourism. He says he’s not for price fixing, but neither is he for exaggerated price competition. He called for “intelligent pricing and not predatory pricing.”
The forum’s final panelist was Tom Kenna, a Panama Canal Railway exec who is also president of the Panama Chamber of Shipping this year.
Kenna explained that passenger service was never in the railroad’s plans. They aim to make their money shuttling containers among the canal area ports and the Colon Free Zone.
However, people from the tourism industry and from Colon Free Zone came to the railroad and asked for passenger service, and the company decided to fill a need that had not been in its original plans. The company decided to give it a try.
“The Panama Canal Railway has been a great success in the shore excursion business,” Kenna noted. But in order to accomplish what it did, they had to make some strategic alliances --- particularly with the cruise lines --- and acquire the sensitivities of the entertainment business.
On the way from Colon to Panama City, Kenna noted, passengers tend to have two major questions. They want to know about the snakes in the jungle through which the railroad passes, and they want to know about the Red Chinese control over the Panama Canal that they have “learned” about from the right-wing press in the United States.
On the way back, having seen a capital that’s more modern than most of them expected and having had something of Panama’s herpetology and foreign relations explained to them, the passengers tend to have different questions, Kenna noted. They want to know about the cost of living here, and how they can come back.
And that latter query, according to Kenna, is a key to Panamanian tourism’s future. HE said that surveys indicate that some 85 percent of cruise ship tourists take their voyages with an eye to longer return visits to the countries that they like.
This year, Kenna, noted, his company expects to serve more tourists, but from fewer cruise ships. On the one hand, his company’s tour, which is not cheap, is very popular so an increasing percentage of cruise ship passengers take it.
But Americans get shorter vacations than people in other industrialized countries, and US regulations do not permit passengers to board a cruiser in Panama and end up in an American port. (This is the nub of Panama’s desire to be officially designated by the US government as a “distant port.” Such a designation would end that ban.) The problem is that for Americans with jobs, a cruise that lasts much more than a week is usually not possible, and it takes about four days to travel between Panama and southern US ports. The round trip requirement puts us on the far edge of the range for most of the US cruise tourism market, and it’s limiting the number of calls we get from cruise ship.
The main presentations over, there ensued a short but lively question-and-answer period.
Herman Bern reiterated one of the tourism industry’s long-standing gripes, the use of the 10 percent hotel and restaurant tax not to advertise Panamanian tourism abroad, but to keep some 800 people on the IPAT payroll. He urged that the proceeds of this tax be set aside only for publicity.
Líder Sucre didn’t think much about combining Costa Rica and Panama in tour packages, but did opine that Guatemala and Panama are a good pairing because their Mayan cultural legacy and our South American indigenous roots provide a good cultural contrast. The problem with Costa Rica, he said, was that other than live volcanoes Panama has everything that the Ticos have and more.
Marcos Ostrander talked about the state of Panamanian environmentalism, and noted that local groups do a lot of things here than Greenpeace does on an international level.
Franz García de Paredes and Tom Kenna expounded further on the intricacies of the cruise tourism business. Bern talked about the possibilities and limitations of investing in Panamanian tourism through the purchase of stocks or bonds.
Líder Sucre wrapped the session up with his arguments about why the completion of the Pan-American Highway through the Darien Gap is a bad idea.
This was AMCHAM’s fourth tourism forum, all of which this reporter has covered. The most notable feature of this one was a selection of panelists with “hands on” experience working in Panamanian tourism one way or another. They skipped the gushy presentations by publicists this time. So AMCHAM and all of the guests they attracted didn’t hear so much shallow stuff about how wonderful we are, but rather a more serious discussion about a crucial element of our national economy.
Taken as a whole, then, this year’s forum was an indicator of a maturation process through which this country’s tourism industry is going.
Also in this section:
AMCHAM tourism panel
El Prado
