PANAMA Trends and Developments Contributed by: Kharla Aizpurúa Olmos, Mónica Moreno and Eduardo Oteiza, Morgan & Morgan
Previously, in 2023, the FATF considered that Pana- ma had made substantial advances in its efforts to address the deficiencies identified in its AML and counter-terrorism financing prevention system. This resulted in FATF delisting Panama from its own “grey” list of jurisdictions under increased scrutiny by the organisation. The delisting from the EU’s list in 2025 marks a pivotal step in strengthening Panama’s international reputa- tion, both financial and otherwise, as it facilitates fast- er and more efficient financial and commercial trans- actions by reducing the need for enhanced AML and due diligence procedures, as European financial insti- tutions may now require less bureaucratic red tape and fewer additional safeguards to approve financing to Panamanian borrowers, compared to what would have been necessary had Panama remained on the list. Moreover, it is expected to boost Panama’s com- mercial competitiveness, reinforcing its already favour- able position as a regional hub for tourism, logistics, finance, and trade. Panama’s previous removal from the FATF list, along with its recent delisting by the EU, serves as evidence that developed economies are recognising the country’s serious commitment to combating money laundering, terrorism financing, and the proliferation of weapons of mass destruction. These developments reflect a broader shift toward international co-operation and Panama’s intention to contribute to a more sustainable and transparent global community. It is important to note, however, that this remains a work in progress for President Mulino’s administra- tion, as Panama continues its efforts to exit several international blacklists, most notably, the EU’s list of non-cooperative tax jurisdictions. For now, this represents a significant obstacle to Panama’s aspiration to join the OECD, especially after the country formalised its application for mem- bership. Admission to the OECD would offer Panama access to technical resources and the opportunity to exchange best practices in public policy with mem- ber countries, further enhancing its ability to attract foreign investment and stimulate a national economy that has shown signs of stagnation in recent years. However, Panama’s removal from the EU’s list of
high-risk jurisdictions for AML purposes represents a significant milestone. It should serve as a catalyst to further energise the country’s industrial, commercial, and political sectors to continue advancing toward greater fiscal transparency and effective co-operation, both domestically and internationally. More recently, Ecuador announced the delisting of Panama from its own tax haven list, consolidating the countries’ commercial ties, and paving the road for a Another recent achievement has been Panama’s successful accession as an associate member of Mercosur, South America’s regional trade bloc. This membership grants Panama direct access to new economic and commercial opportunities, while also strengthening its ties with member countries. Mer- cosur is integrated by Argentina, Paraguay, Uruguay, Brazil, and Bolivia (in addition to other associate states such as Chile, Peru, Colombia, Ecuador, Guyana and Suriname), which together represent the world’s fifth- largest economy and a combined market of over 271 million people. This association offers Mercosur member countries a mutually beneficial relationship, positioning Panama as a strategic logistical bridge for South America to Central America and the Caribbean. By leveraging key infrastructure such as the Panama Canal and Tocu- men International Airport, Panama facilitates more seamless and commercially favourable connections across regional markets. future trade agreement between them. Panama’s Integration into Mercosur As an associate member of Mercosur, Panama gains access to certain commercial, financial, and logistical benefits offered by the bloc (although to a somewhat limited extent as compared to a full membership of the bloc), without being required to adopt its com- mon external tariff or customs agreements. Never- theless, President Mulino has already indicated his intention to seek approval from the National Assembly to pursue full membership status in the near future. As a full member of Mercosur, Panama would gain the ability to actively participate in and influence the bloc’s decisions on tariffs, migration, technical regula- tions, and financial and environmental policies, further
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