Panama historically has had closer ties with the United States than any country in Latin America other than Mexico. The country is known best, of course, for the Panama Canal, which the United States built for both military and trade purposes at the start of the 20th century. The United States maintained sovereignty over parts of Panama until 1999.
Panama covers an area of 78,200 square kilometers. It had a population of 3 million at the end of 2003 and a growth rate of 1.36 percent (July 2003 estimate). The life expectancy at birth is 72 years. The literacy rate is about 93 percent. The country's gross domestic product is about $6,000 per person, and a little more than a third of the people live in poverty. The unemployment rate was 16 percent in 2002. Main industries are the Panama Canal and international banking.
Spanish is the official language. About 14 percent speak a creole form of English, and many residents are bilingual in Spanish and English. About 7 percent speak indigenous languages, the largest of them being Ngäberre. There are also pockets of Arabic and Chinese speakers.
Studying Spanish in Panama:
Panama has several small language schools, most of them in Panama City. Most of the schools offer home stays, and costs tend to be low.
The Panama Canal is on most visitors' must-see list, but those coming for extended stays can find a wide variety of destinations. They include beaches on both the Atlantic and Pacific oceans, Darien National Park and cosmopolitan Panama City.
Panama was the first Latin American country to adopt the U.S. currency as its own. Technically, the balboa is the official currency, but U.S. bills are used for paper money. Panamanian coins are used, however.
Before the Spanish arrived, what is now Panama was populated by 500,000 or more people from dozens of groups. The largest group was the Cuna, whose earliest origins are unknown. Other major groups included the Guaymí and the Chocó.
The first Spaniard in the area was Rodrigo de Bastidas, who explored the Atlantic coast in 1501. Christopher Columbus visited in 1502. Both conquest and disease reduced the indigenous population. In 1821 the area was a province of Colombia when Colombia declared its independence from Spain.
Building a canal across Panama had been considered as early as the mid 16th century, and in 1880 the French tried but the attempt ended in the death of some 22,000 workers from yellow fever and malaria.
Panamanian revolutionaries secured Panama's independence from Colombia in 1903 with militarily support from the United States, which quickly "negotiated" the rights to build a canal and exercise sovereignty over land on both sides. The U.S. started construction of the canal in 1904 and finished in 10 years in what was considered the greatest engineering achievement of its time.
Relations between the U.S. and Panama in coming decades were strained, largely due to popular Panamanian bitterness over the prominent role of the U.S. In 1977, despite controversies and political snags in both the U.S. and Panama, the countries negotiated an agreement turning over the canal to Panama at the end of the 20th century.
In 1989, U.S. President George H.W. Bush sent U.S. troops to Panama to oust and capture Panamanian President Manuel Noriega. He was forcefully brought to the United States, put on trial for drug trafficking and other crimes, and imprisoned. He is currently serving a 40-year sentence.
The treaty turning over the canal was never fully accepted by many political conservatives in the United States. When a ceremony was held in Panama in 1999 to formally turn over the canal, no senior U.S. officials attended.