Looking back to the health crisis caused by COVID-19 ten years ago, here’s what we have learned in Panama. First, the consequences of paralyzing an entire economy have multiple ramifications. When the government lifted the curfew, many companies had gone under. Not the big ones, but many little ones that provided plenty of jobs to regular people, little companies that were not prepared for telework, or simply that were in industries that cannot telework. Companies in the transportation industry, schools, clothing stores, restaurants, cleaners, hair salons, gyms. Also, the government discovered that jump starting the economy was not a simple matter of pouring millions into it. We needed to start producing again (because anything that we sell needs to be produced beforehand), and the production infrastructure had collapsed. In rebuilding the production infrastructure, some entrepreneurs anticipated correctly what consumers would wish to buy, and did well. Others made incorrect anticipations, and they did poorly. But the government could not help anyone, because it had run out of resources fighting the crisis. So, for a while there were less things to be bought and sold, and we were faced with true scarcity for the first time in our lives.
Second, we became very aware that death can come riding invisibly on each one of us. We are now more careful about hygiene than we were before the crisis: there are several hand sanitizer dispensers in each wall in each office; it has become standard that people sanitize their hands several times during the day, but especially when entering a new space and before shaking hands with other people; no one ever coughs or sneezes into their hands, always on their sleeves if they don’t have a handkerchief handy; going to work or running errands with flu symptoms is not only rude, but illegal, and can result in hefty fines.
Third, in those industries in which teleworking was possible, teleworking became the standard. During the crisis, companies that were prepared for teleworking had less difficulties surviving. Those that were transitioning to part-time telework were forced to transition to full-time telework in a matter of days and, once the transition completed, there was no going back. People still go to the office, because many things are still done more easily in person, but face time is no longer a requirement in those industries.
And last, but not least, we realized that needed to trust each other more. Because of the rigidity of a distrustful, paper-based nineteenth-century system that was still in use in the twenty first, we were falling behind in everything related to services. We were unable to compete with the nimbleness of the laws of other jurisdictions, which trusted people more at the beginning and punished them harder at the end if that trust was betrayed. We needed a more modern Public Registry and Notarial systems. We changed the laws so that we could start working without paper, without Notaries, without spending thousands and even tens of thousands of dollars in mortgage recordation fees at the Public Registry. The requirements to record documents at the Public Registry were simplified to the point that any document could finally be recorded on the same day it was filed. That made finding those documents much easier, and managing them ceased to be a nightmare.
That new trust also made it easier for everyone, but especially for foreign investors, to transact business in Panama. Before the crisis, opening a bank account in Panama was a three-week process that required reams of paper to complete, when the same person could open a bank account online in a matter of minutes. Forming a corporation was not easier in Panama, so potential clients went to other jurisdictions. Now the laws permit streamlined processes not only in the private sector, but also in the government. We have learned that the process itself is less important than the goal it serves, that complying with every step of the process is useless if the goal is not achieved.
The health crisis caused by COVID-19 ten years ago changed our society, yes, but it changed it for the better. Panama is now a more mature jurisdiction, with a better understanding of its role in the world. Let’s keep working so that it remains that way.
