Betting on Beauty

Jan 1, 2005

Panama wants to double its tourism industry revenues in five years. Better organization will be needed to make that plan attainable.

Panama's tourism minister, singer-actor Rubén Blades, has ambitious plans for transforming his sector into a key component of the country's economic development program. He wants to turn to the international capital markets to help make it a reality.

Blades has proposed a $100 million, 10-year sovereign bond issue to raise funds for the Panamanian Tourism Institute (IPAT), the country's tourism promotion and development agency. Planning is still in its preliminary stages and Blades is not sure whether IPAT itself or the sovereign would be the issuer. The government has optimistically predicted that tourism could generate as much as 12% of GDP by 2009, double the current 6%. Blades says part of the revenue from the bond could be used to support small- and medium-sized businesses that typically form the backbone of the tourism sector. Blades suggests using Panama City's Atlapa Convention Center, which IPAT owns, as...

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