Better Than Disney

Dear International Living Reader,
Forty-five minutes by helicopter out of Panama City, and we were halfway there. Below us, as far as we could see in every direction, jungle. We were flying over the Darien region of Panama, bordering Columbia. Few outsiders find their way here. The only signs of life from the helicopter's windows were the occasional canoe in a river and, here and there, groupings of Indian huts.

We were on our way to see Robert's trees.

There are six ways to obtain a residency visa for Panama. One of the most straightforward is the Forestry Investor Visa. You invest $40,000 with an accredited reforestation company in the country, and, in return, you receive 3.2 acres of land (titled in your name) planted with teak trees...and an Investor's Visa, which, after five years, makes you eligible to apply for a Panamanian passport. Many groups offer Forestry Investor Visas tied to investments in teak plantations. One stands out as most appealing: United Nature, for a couple of reasons. First, they've been in business for more than 10 years. Second, they give you title to the land your trees are planted on. In other words, you don't get 3.2 acres worth of trees at harvest time...you own 3.2 acres planted with teak.

I've been skeptical of these teak investment programs in Panama. Why are there so many operating here? And are they for real?

We asked our Panamanian attorney (and friend) Rainelda Meta-Kelly to take a look and pass an opinion. Rainelda gave the thumbs-up. She, like us, liked the fact that investors take title to their land with United Nature. This gives some peace of mind. The group offering the investment must own the land, or they couldn't parcel out title to you. (Yes, you've got to be that careful.)

Still...I wanted to see for myself.

It rained from shortly after our helicopter landed until just before we took off for the return to Panama City. With the rain came mud...and with the mud came adventure. Better than anything you'll ever experience at Disney, this was real off-road jungle free-wheeling. Dressed in yellow slickers, baseball caps, and knee-high boots, we loaded into four-wheeled Kawasaki motor bikes, open to the rain, with roll bars to save us being crunched if we took a tumble, three to a vehicle, plus a driver, and took off down deep-rutted paths, sometimes a foot thick with mud, sometimes flooded out altogether.

The plantation is organized by year of planting. It takes about 25 years to see the total payout from a planting. You make some money on pruning harvests, then most of the money from one big final harvest. In the end, an investment in 3.2 just-planted acres could return you more than $300,000.

You can buy more mature trees. You pay more per acre, but the time to maturity is less.

After we'd had our fill of four-wheelin' it (and were wet and muddy enough to prove it), we made our way to the little clubhouse on the plantation for lunch. Over bar-b-cued steaks, Robert Kroesen, one of the two United Nature principles, answered my questions. First, one reason there are so many teak programs operating in Panama is because the government has made it advantageous for them to be here. Further, this remote Darien region of the country is one of the few places in the world where teak trees flourish. (Note, the Darien is not Bocas del Toro. Some teak programs have their plantations in Bocas. Robert, and others we've spoken with, warn against this. Bocas doesn't have the appropriate lengthy dry season, they say, to grow quality teak.)

Are these programs for real? I'd say United Nature is. They have a 10-year track record and seem serious about their business.

Teak, they tell me, is the platinum of the tree world, becoming more valuable on the global market. Myanmar is the world's leading producer, responsible for 80% of world supply, but its teak is running out. National Geographic reports that the last teak forest in Myanmar will be logged by 2010. Then the world supply will drop, as demand continues to grow. Prices should go up.

Of course, there are no guarantees. But the real point is, you've got your Panamanian residency... and maybe, eventually, a passport in the bargain.

And a visit to see the trees up close is so much fun I told Robert he should charge admission.

Regards,

Kathleen Peddicord
Publisher, International Living

P.S. Robert also took us on a side trip to visit the nearest Indian village (which provides labor for the teak farming). We traveled downriver by canoe and were met onshore by a contingency of the village's children, who welcomed us shyly. The chief came out to meet us and asked if we'd like to see a traditional dance. We gathered in the village's central meeting place, which, fortunately, had a roof. It poured our entire visit. The children played in the rain in the way I remember playing in the backyard sprinkler as a kid.

As we were leaving, one woman approached me with a basket. Was I interested? Robert intervened to explain that the baskets these Indians make are so tightly woven they hold water. They're elaborate in design and sometimes colorful, too. I bought the basket from the woman for $25 (which Robert assured me was a bargain for its size...in Panama City, he said, it'd sell for at least $50). Suddenly, half the woman in the village had baskets to offer. We set out a table, where they set out their wares. We chose the ones we liked best and asked the women to name their prices. In the end, we spent about $180 on 17 baskets.

P.P.S. What's been the best-performing investment of the last 100 years? A friend recently did the research to find out. The answer is timber.

Our staff in Panama can tell you more about Panama's Forestry Investor Visa and United Nature. Reach them at Panama@InternationalLiving.com.