It is not hard to figure out what helped build Panama, just look north to Miami where I can remember the days of Miami Vice scenes where the limo pulls up to the bank and several guys unload dufflebags and walk into the bank.  That was before the $10,000 reporting limit for cash deposits.

The movement of illicit capital in Costa Rica and Panama counts for more than 10% of their respective GDP, meaning that its removal would be a major blow to their economies.  The drug flow is north to the US and the money flow is south.  It gets washed and dried and then invested in luxury items, businesses and yes good ole real estate.

Editorial

The report entitled “Illicit Financial Flows from Developing Countries: 2001-2010” by Global Financial Integrity, reveals that during the first 10 years of the new century, the flow of illicit money in Costa Rica amounted to $64 billion, while in Panama the total was $40 billion.

As an example, illegal capital flows from 2001 to 2010 in Mexico totaled $476 billion. Just comparing the size of its economy with those of Costa Rica and Panama is enough to see how in the latter two countries the importance of illicit capital flow is excessive. With less intensity, this is situation is replicated in other Central American countries.

An article in Estrategiaynegocios.net explores this phenomenon and its impact on the countries of Central America, who, little by little, are becoming narco-economies.

Here is the executive summary of the report

Source: Estrategia & Negocios