In Panama the increase in room supply has caused a price war between hotels trying to attract travelers and increase the occupancy rate which on average is not more than 60%.

Hotel occupancy in the country has been declining since 2011, when it stood at 68.6% dropping to 59.3% within the sector this year, according to figures from the Tourism Authority of Panama (ATP). In contrast to this, the number of tourists arriving in the country and the expenditure made during their stay in the country has not stopped growing.

Laestrella.com.pa reports that “… the supply has grown so fast that it is virtually impossible for demand to catch up…Ernesto Orillac, ATP, said the drop in hotel occupancy ‘was seen coming because of an increase in supply of over 100%.'”

Orillac added that “… the increase in rooms has caused a price war ‘… which has resulted in loses of ” … up to 30% of value, which is good for tourists but bad for companies, says Jorge Campuzano, president of the Chamber of Tourism of Panama (CAMTUR).

Source: laestrella.com.pa