Recession Tourism Invented in Panama |
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| Written by Matt |
| Monday, 12 January 2009 07:18 |
 Historically, a small handful of industries actually flourish during a recession. Drug dealers for example, are known to do well as are suicide counselors, lawyers who specialize in domestic violence, and liquor companies whose heritage cocktails hark back to the pre-war eras of prohibition and the Great Depression. What untapped industry in Panama is waiting to emerge in 2009 as, not only recession-proof, but perhaps recession-reliant?
Three words: Bud-get travel.With victims amidst the global crisis still wanting to travel, if not more than ever before, this coming tourism year will simply stress different values. Travelers of the recession will be looking for good experiences at good values, something that we, here at The Panama Report, have been preaching about Panama for years. Before you get all fussy and say that Panama City is getting more expensive by the day, we're actually referring to the country's interior where gorgeous coasts, sprawling mountains, and untouched rainforest haven't yet been bitten by the three-dollar beer. With recession tourists' budgets for trips or relocation sinking, 2009 is likely to see a decrease in long distance trips like the one your parents took to Asia, instead favoring mid-range jaunts of which Panama falls perfectly into the radar. Mid-range destinations like Panama offer low prices, guaranteed good weather, and an exotic feel without breaking the bank or even surrendering much comfort...if you know where to look. A similar niche market that has shown great promise according to the United Nations World Tourism Organization (UNWTO) is that of youth travel. "Because of their unique motives to travel, the youth travel segment has become a niche market that is extremely important to the key objectives of the global tourism agenda," believes Royal Intel, a tourism intelligence consulting agency. "Moreover, as one of the fastest growing sectors of the tourism industry educational institutions, employers, official tourism organizations, and governments around the world are starting to recognize the personal, social, and economic value of youth, student, and educational travel. {adsense} According to Royal Intel, the profile of this traveler is very similar to Panama's recession tourists: - Youth travel represents an estimated 20% of all international arrivals. - Young travelers stay longer and in the long run spend more than the mainstream tourist. - 70% travel with a purpose - to learn a new language, volunteer, and work or study abroad - 80% return to their home country with a more tolerant and respectful attitude towards other cultures - Emergence of the ‘Flashpackers', older backpackers with more disposable income, which extends the age bracket of the youth travel market to 30+ years Panama, with its newly budding tourism industry, is in a unique situation to profit from what I'm dubbing recession tourism: the market of penny-pinching travel enthusiasts, regardless of age, who want desperately to escape the dreary circumstances of work and home. It is a group of cost-conscious guests that's very different from the high-end travelers that have boomed throughout much of the past decade. This new market is looking less for Kobe beef platters, private chauffeurs, and palatial accommodations and more for culture, experience, and value in their vacation. A number of different mentalities will be considering Panama as a vacation or temporary relocation, among them, those: - Seeking a change of pace from depressed office scene - Looking to emotionally recover from unemployment - "Gap Year" students looking to postpone entry into slow market or take time to evaluate their life stages - Mid-life crisis individuals who can't afford a convertible - Investment/property professionals grabbing their bonuses and eloping To the recession tourist, there's nothing better than the combination of cheap, close, and exotic. By following the following few guidelines, recession tourism in Panama could make a name for itself in 2009. {adsense} 1. Car rentals: The best way to see Panama is by renting a car. Once outside chaotic Panama City, the roadways are empty and relatively simple to navigate. The best way to rent a car is through Travelocity (use the "Cars Only" search feature) where economy car rentals are around $50/week. This insanely cheap transportation option, besides giving travelers an added echelon of local experience, takes advantage of low gas prices and even provides a last-resort sleeping option should reservations happen to fall through. 2. Local eats: Panama's top restaurants are good, they're also close to as expensive as many places at home. What will attract recession tourists in Panama is the interior's abundance of fondas or down home Panama eating parlors, some on the side of the road, some on the side of a beach. Eating where the locals eat a) gives a better window into Panama's great culture, b) inevitably leads to hilarious war stories to take home, and c) doesn't hurt the wallet (most of these places charge like $2 for a heaping plate of food). $1 beers and fried fish on the beach could prove the universal liberation for a suffocating economy. 3. Adventure tours: Ever feel like breaking something when you're mad? Panama's young, yet dynamic adventure tour industry is growing by the month and will perfectly accommodate disheartened crises-goers looking for some adrenaline in their lives that isn't paired with the stock market. With prices low and tour companies relatively new, recession travelers will love entering caves, scaling waterfalls, and zipping through rainforests: just like they can in Costa Rica, but for about one half the price. Surfing, kiteboarding, and white-water rafting are great remedies for stress. 4. Friendly Immigration: Not to jinx the ever-volatile Panama immigration system, but as it stands, foreigners are permitted to stay up to three months in the country as a tourist, having only to buy a $5 visa card at the airport. This allows for extensive exploring (or temporary relocation) and is perhaps just the right amount of time to transform from tourist to local. 5. Cheap Flights: It is now comparable in price (and actually in time) to fly from Newark, New Jersey to Panama City as it is to fly from Newark to Los Angeles. Flight prices to Panama have decreased by around 50% in the past few years, with all the big airlines making direct (and stopover) flights into Tocumen for really reasonable prices. This should open up a whole new market of recession long-weekenders and oh-what-the-hell people who can either go out for an expensive night on the town or fly to a tropics. 6. Unique accommodations: While Panama's hotel industry is certainly green, in it lies a large number of great deals and unique experiences to be had. Whether you're looking for a waterfront hostel with an in-house bar, or a cool boutique hotel who doesn't charge up the ass, Panama's interior is dotted with great options. For hostels, the gold standard is Mondo Taitu in Bocas del Toro and Luna's Castle in Casco Viejo, for inexpensive luxury try Cala Mia in Boca Brava (David), and for living like a local in the City rent an apartment in the historic district for less than a night at a luxury hotel through Los Cuatro Tulipanes . Many of these options too are open to the idea of extended stays, offering discounts by the week. Recession tourism in Panama may just be my gimmicky name for the obvious. When financial institutions hurt so do their people, and as a result the global tourism market (just like any market) adapts by lowering prices, offering specials, and investing in new technologies to stay afloat. And it may be overly optimistic of me to predict that Panama is in a great position to profit from the world's economic woes. But from the external factors such as cheap transportation, to the internal potential such as great value and cultural immersion in Panama's interior, recession tourists may just emerge out of the blue and, for the time being, help define the often otherwise shapeless direction of tourism in the isthmus. Image: flickr.com/photos/dscher/762443361/ Trackback(0)
Comments (6)
  written by Paul McBride , January 12, 2009 Matt, I agree that car rentals are a great value in Panama and the vest way to see the country. But, people should be aware that the mandatory insurance coverages and taxes will add up to more than the rental of the car. Just a warning so people aren't shocked when the total cost is more than double what the online quote is. This is still a great deal but the budget minded have to include these costs in their calculations.
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 written by Mateo , January 12, 2009 Nigel, renting a luxury SUV is not the kind of recession travel I'm referring to: rather, try a Yaris for $52/week which in my opinion is totally sufficient for Panama's interior - unless you're trying to drive in Veraguas to the Caribbean coast, the Carretera Llano Carti, or some other obscure mountainous terrain. In the heart of the rainy season, maybe upgrade to some kind of 4x4.
Paul makes a good point I should have mentioned - insurance is often mandatory (and actually suggested) and can be around $10/day (in the price scenario quoted). Still, renting a car for less than $20/day is not bad at all. report abuse
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written by Paul McBride , January 12, 2009 Matt is correct regarding insurance. My experience with the Yaris is that it is a good, economical car but it has very low clearance from the ground. This can be particularly bad given Panama's notorious potholes and road conditions. Keep in mind, the rental car agencies will go over your car with a fine tooth comb when you return it. Budget tried to nick me for $200 because of a tiny scratch under the front bumper that came from road wear. In the US, this would be considered normal wear and tear. In Panama, they'll try to charge you for this. And, don't forget to really pay attention when you do the car inspection when you pick up the car. Make sure you note every scratch, dent and imperfection and put it on the inspection form. Otherwise, you may have a problem when you return the car.
The best way around this is to get all the insurances offered. For example, unless you have tire and window insurance, you will be charged for a flat tire. Adding the insurances can run up the bill fairly quickly, but the alternative will be very expensive if you have an accident or mishap. And remember, your US insurance does not necessarily cover you in Panama. Even if it does, you will have to pay for any damages and then collect from your insurance company. I had a client who damaged a car and had to pay for the repair costs before they were allowed to leave the country. Overall, renting a car is a great way to see the country. But, consider all the possibilities before you do. If you don't like taking risks, add all the insurances offered. If you're more of a risk taker, just accept the mandatory coverages and hope for the best. report abuse
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 written by Stuart , January 24, 2009 Hi Matt, I know it's been awhile but have you forgotten me already???? You missed Hostel Mamallena off the list of good budget accommodation! We're one of the oldest hostels in the city and I'd like to think we at least meet the standards of Lunas Castle, especially in our new location. The website is www.mamallena.com
There's my little plug, and I hope you're feeling better. Catch you soon report abuse
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written by El Gringo , August 03, 2009 This is a very interesting concept Matt. I might add that low-priced tourism enterprises generally benefit (though we also notice some ultra high end places experiencing good numbers too). Mostly, it's the middle range places that have no distinct demographic that suffer.
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| Last Updated on Saturday, 06 June 2009 12:18 |
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You can't actually rent a car in Panama for $50/week. The mandatory insurance alone is $12/day. It's $150/week for the smallest, manual shift car. That's a big chunk of the budget tourist's budget per week.
Not to mention, a tiny car not suitable for say 4 guys with camping/hiking equipment.
A more accurate and realistic cost is $600/week for an Xtrail.
Of course, if you could eliminate the Panama corruption insurance (most credit cards, home insurance, and trip insurance policies actually do cover rental cars) the price for even the Xtrail drops down to a more affordable $150-$200/week for a car suitable for 4 people, luggage, and high ground clearance for interior adventures.