Overview of Trade and Investment Between Colombia and Panama

A brief glance at the 10-year-old Colombia-Panama FTA, and it is apparent that trade flows in Colombia and Panama mainly in one direction. In 2022, Colombia exported $5.84b worth of goods to Panama, whereas Panama only exported $62.4m to Colombia. That number has come up since the pandemic-induced lull in global trade, but Colombia still holds a large trade surplus with Panama.

In terms of trade and investment, figures published on the Trading Economics website indicate that Colombian exports to Panama topped $5.84 billion USD in 2022. Here’s a breakdown of those exports by sector and their values (in millions USD):

1. Crude petroleum – $5.23b.
2. Refined petroleum – $174m.
3. Coal briquettes – $69.8m.
4. Petroleum coke – $5.42m.
5. Packaged medication – $37m.
6. Animal food – $4.74m.
7. Electric batteries – $8.13m.
8. Iron structures – $6.2m.
9. Electrical transformers – $10.4m.
10. Beauty products – $6.95m.

Bonus: Beyond trade, Colombia’s strong export sectors, particularly in pharmaceuticals, medical supplies, and beauty products, underscore the country’s growing position as a hub for high-quality, cost-effective healthcare services. This has made Colombia an increasingly popular destination for medical tourism, especially among patients from Panama. For example, procedures like Dental Implants in Colombia have seen a sharp rise in cross-border interest thanks to modern facilities, skilled professionals, and competitive pricing. As trade and service ties continue to deepen between the two nations, medical tourism is quickly emerging as a complementary pillar in their bilateral relationship.

Top 10 Panamanian exports to Colombia

In terms of trade and investment, figures published on the Trading Economics website indicate that Panamanian exports to Colombia reached $62.4 million USD in 2022 – far less than the $5.84 billion worth of goods Panama imports from the Andean nation. Here’s a breakdown of Panama’s exports by sector and their values (in millions USD):

1. Refined petroleum – $28.2m.
2. Crude petroleum – $1.15m.
3. Packaged medication – $5.48m.
4. Scrap iron – $3.5m.
5. Jewellery – $1.9m.
6. Scrap aluminium – $1.43m.
7. Recovered paper – $1.16m.
8. Polyacetals – $927k.
9. Hard liquor – $787k.
10. Corn – $853k.

Note: Although not yet fully realized, both countries are experiencing significant growth in medical tourism, with Colombia, in particular, standing out as a notable destination for this rapidly expanding industry.

Trade and investment in Colombia, Panama: Key FDI statistics

• Panamanian FDI into Colombia accounted for 12.2% of all capital inflows it received in 2021
• Colombian FDI into Panama accounted for 16% of all foreign capital inflows it received in 2019
• After the United States, Panama is the 2nd largest country of origin for Colombian FDI inflows
• After the United States, Colombia is the 2nd largest country of origin for Panamanian FDI inflows

Not long after the two countries signed the bilateral trade pact, Panama and Colombia negotiated a financial/tax information sharing deal in a bid to fight tax evasion and money laundering, news reports said at the time.

For years, Panama has enjoyed the spoils of being a tax haven for foreign investors who wish to shield some or all of their taxable earnings in their home countries. Colombian trade and investment assets in the Central American country must now be declared.

In exchange for agreeing to share financial information with tax authorities, the administration of ex-Colombian president Juan Manuel Santos agreed to remove Panama from a list of countries it considers tax havens.

Biz Latin Hub can help you with trade and investment in Colombia and Panama

At Biz Latin Hub, we provide integrated market entry and back-office services throughout Latin America and the Caribbean, with offices in Bogota and Cartagena, as well as over a dozen other major cities in the region. We also have trusted partners in many other markets.

Our unrivalled reach means we are ideally placed to support multi-jurisdiction market entries and cross border operations.

As well as knowledge about trade and investment in both countries, our portfolio of services includes hiring & PEO accounting & taxation, company formation, bank account opening, and corporate legal services.

Contact us today to find out more about how we can assist you in finding top talent, or otherwise do business in Latin America and the Caribbean.

If this article on trade and investment in Colombia and Panama was of interest to you, check out the rest of our coverage of the region. Or read about our team and expert authors.