Capital city Panama
Surface 75,517 km²
Population 3,662,000
Road network length 16,336 km
Length of highway network 111 km
First highway 1980
Motorway name autopista
Traffic drives Right
License plate code PA

Panama (Spanish: República de Panamá) is a country in North America. The country is the southernmost country of this continent and has 3.6 million inhabitants. The country is twice the size of the Netherlands and the capital is Panamá, also known as Panama City.


According to ABBREVIATIONFINDER, Panama forms a land bridge between the continents of South America and North America. The land is oriented east-west, in contrast to the adjacent land masses, which are oriented more north-south. Panama borders Costa Rica to the west and Colombia to the east. The country measures a maximum of approximately 600 kilometers from east to west and approximately 200 kilometers from north to south, but is narrower in many places. To the north is the Caribbean Sea, to the south the Pacific Ocean. The Panama Canal cuts through the country, this is also where the capital Panamá (Panama City) is located. The Panama Canal runs through Lago Gatun, also the largest lake in the country. Panama has only small rivers that drain quickly to the sea.

A large part of Panama is hilly to mountainous and large parts are densely forested with tropical rainforest. Some ridges are oriented east-west, with the highest mountains in the border area with Costa Rica. The 3,475 meter high Volcán Barú is the highest point in Panama. However, most mountains are not nearly that high, with only a few peaks exceeding 2,000 meters. The southern peninsula of Panama is lower and more cultivated, with less forest.

Panama has a tropical climate with high humidity with little variation in temperature. The average maximum temperature in Panama City is 33-34 °C all year round. Temperatures are lower in the higher mountains. The mountains are not high enough for an alpine climate, but the highest peaks are above the tree line.


Panama has a steady population growth, the population quadrupled from 1 to 4 million between 1960 and 2010. See Panama population density. The population is highly concentrated in and around the capital Ciudad de Panamá (Panama City). Of the 10 largest cities in Panama, next to the capital Panama City, 7 are located as suburbs of Panama City. This is also where all cities with more than 100,000 inhabitants are located. The largest city in the country outside the Panama City region is David in western Panama.

Two-thirds of Panama’s population consists of Mestizos, which are mixed Indo-Americans and Europeans. More than 12% are indigenous, 9% African and 7% white. Spanish is by far the most spoken language in Panama, almost the entire population speaks it. English is also relatively widely spoken due to Panama’s status as a center of world trade.


Panama is the most developed country in Central America. The GDP per capita at the purchasing power level was just over $25,000 in 2018, significantly higher than most Latin American countries. However, the economic contradictions are quite large, with a high level of prosperity in and around Panama City, but a backward rural area. Panama’s economy is dominated by the Panama Canal, the service sector is therefore dominant in the country. The canal is an important source of employment and revenue from tolls. The country also counts as an international financial center, but is also known as a tax haven. In Panama most people pay with the US dollar, although it also has its own currency, the balboa, which has been pegged to the US dollar since 1903.


The Spaniard Rodrigo de Bastidas was the first European to visit Panama in 1501. Columbus arrived a year later. In 1513, Vasco Núñez de Balboa was the first European to reach the Pacific Ocean after trekking through Panama. After that, Panama became an important crossroads of the northern and southern parts of the Spanish Empire in the Americas. At the beginning of the 19th century, the wars of independence raged across the American continent. However, Panama became peacefully independent from Spain in 1821, although it was thereafter part of Gran Colombia. In 1903 Panama seceded from Colombia and then became a sovereign country. A provision in the Declaration of Independence gave the United Statesthe right to exploit a piece of land 16 kilometers wide and 50 kilometers long “for eternity”. This is where the Panama Canal was built, which was completed in 1914. This was one of the most important public works in the world. Until 1979, the Panama Canal Zone was a territory of the United States.

During the 20th century, Panama was able to take advantage of its strategic location between the two oceans. As was often the case in Latin America, the political situation in Panama was also periodically unstable. Between 1983 and 1989 Manuel Noriega was the de facto leader. Noriega maintained close ties to US intelligence and was a key link in US operations against rebels and the War on Drugs in Latin America. However, Noriega’s regime was characterized by criminal activities such as extortion, drug trafficking and money laundering. Noriega was eventually deposed in 1989 by a US invasion of Panama. The country quickly returned to civilian rule and administration of the Panama Canal was finally handed over to Panama on December 31, 1999.

Panama Location Map