Claudia and María, two European travellers with big backpacks and small budgets, are trying to find a bed for the night and luck, it appears, is not on their side: Mamallena, a popular hostel in the city’s financial district, is booked out for days as are several other well-known haunts.
Go upmarket and it is the same story. The Executive, a tall but basic hotel located nearby, does not have a single vacancy. Just down the road at the Sheraton Four Points, meanwhile, reception-desk attendants are turning customers away in droves.
For now, at least, Panama is full. According to official figures, tourism last year netted $1.4bn, according to official figures. Yet Rubén Blades, the salsa performer and now the country’s tourism minister, believes this is just the beginning.
“Costa Rica and the Dominican Republic established themselves as tourist spots a long time ago but they don’t have what we have,” he says.
It is easy to understand what he means. As the southernmost and thinnest country on the central American isthmus, Panama occupies a unique position in the world. Thanks mainly to the Panama Canal, it is one of the most important shipping corridors and, increasingly, a regional logistics hub.
Start to travel in this slip of a country and the geographic and cultural diversity is just as impressive. To the north-east, the Cuna Indians live on 365 small coral islands surrounded by turquoise waters in much the same way they have done for generations.
Diminutive women with legs and forearms wrapped in strings of tiny glass beads spend much of their time sewing molas, rectangular pieces of fabric whose layers of cloth depict scenes ranging from traditional geometrical patterns based on lizards and turtles to the latest cartoon characters from Japan.
In Bocas del Toro, on the same Caribbean coast but in the far west, fishermen of African descent live in brightly coloured clapboard houses and talk in rapid-fire Patois, a variant of English so far removed from its origins that English speakers can barely identify one word in a dozen.
With such a rich heritage and diverse geography, it is sometimes bewildering to think that tourism in Panama has lagged so far behind that of its neighbours for so long. But Mr Blades believes he knows why. “We haven’t been co-ordinated. Government has acted until recently like individual fingers rather than as a whole hand.”
Yet he also says that things are starting to change. For the last three years, he and his colleagues have been working on an ambitious plan to draw up an inventory of the entire country to be able to develop the tourist industry over the next 20 years in an orderly way.
The idea, which involves defining and cataloguing property titles, land use and available infrastructure in each of the country’s provinces, is designed to identify the areas that most require development and then help design specific projects with the private sector to create growth and jobs.
Other initiatives include a tourism law, which he says should be approved by the end of this year and would establish a clear legal framework within which companies in the tourism sector can invest and operate in Panama. “At the moment we don’t have a law that works,” he says. “We don’t even have a proper tourism ministry.”
Some specific projects are already under way, though. For example, the government is working on a programme to establish Panama as a “home port” for cruise ships, which would involve several companies starting and finishing their cruises in Panama. The government is already in talks with several leading companies in the industry, and it believes an agreement should be in place by next year.
A second planned project involves negotiations with Caribbean countries such as the Dominican Republic and Cuba to establish tourist routes spanning two or more countries at a time.
There are also tax incentives for companies looking to develop tourist facilities and projects. These include tax exemptions on profits for the first 15 years of operation, exemption on import taxes on building materials that are not produced in large quantity in Panama and an exemption on property taxes for 20 years.
Mr Blades admits that there is still a way to go. “This is a long-term project, and few people are going to be singing my praises for what we achieve in this term,” he says. But he has no doubt that Panama will eventually become one of the world’s great tourist destinations, and he draws on a little history to make his point.
“When the Spanish came, they had to deal with intolerable heat, impenetrable jungle and some of the most ferocious Indians on the continent. So why did they persevere? Because there is nothing in the world like Panama.”