Saturday, September 05, 2009

The Panama City Taxi Fare Conundrum

Panama City, Panama

The tourist literature touts the cheap taxi fares within Panama City as one of the region´s best values.

Don´t you believe it.

Officially, the taxi fares are inexpensive. Hacks operate on a zone system. Crossing several zones only costs two, three or four dollars. Since Panama City isn´t that big, you should never have to pay more than a few singles for a ride.

But the taxi drivers take one look at your non-Panamanian mug and they quote two or three times the official price. They won´t negotiate much, because they have a powerful ally: the weather.

There´s nothing stopping you from standing on a corner and flagging down cabs until you find an honest driver. Nothing, except for the fact that in five minutes the heat and humidity will have you soaking through your underwear with sweat. So, if you don´t want to arrive at your destination looking like Michael Phelps after a hard day´s practice, you pay the ferryman.

Other factors prevent you from getting the official price. Panama City has no metro, only the wealthiest can afford a car, and only the poorest ride the intracity bus lines; everyone else uses taxis. Consequently, there´s not a lot of available cabs.

Panama City taxi rules allow a cabbie to pick up other passengers en route. You can sit down in an empty taxi and, before you know it, you´re squeezed between two strangers. Some of the cabbies understand travellers´ desire for a solitary ride, but they make you pay for the privilege.

And if you´re going anywhere near the Canal, take your negotiating hat off and surrender. No one wants to return from Panama without being able to say that they saw the Canal, and the cabbies know that. Regardless of the official rate, they want $25. As always, you´re free to stand on the corner of Via Argentina as long as you want searching for a lower fare to and from the Miraflores Locks. In addition to the sweat, watch out for the midday cloudbursts.

I blame the government. The zone system isn´t enforced. The cabbies have no fear that their licenses will be suspended or revoked if they gouge the gringo.

The government also warped the market by creating a standard $25 rate to or from the international airport -- a rate which is significantly higher than rates to the domestic airport or the national bus terminal. The $25 might make economic sense after factoring in distance, turnaround time, etc., but the principal lesson the drivers learned was ¨Tourists will pay $25 for a ride! Let´s try to charge $25 for everything!¨

If I were a Freakonomics type, I would tease some punchy, counter-intuitive truth from these observations. As it happens, the experience leaves me grizzled.

It´s not the absolute amounts that rankle. Being charged $5 for a $2 ride won´t break the bank.

What grates is the constant feeling of being ripped off every time I step into a Panama City taxi.

And that´s entirely a government creation.

If the government enforced the zoned fares, there would be no problem.

If there were no zoned taxi fares -- if the rates were entirely a product of free-market negotiation each time I haled a cab -- there would be no problem. If I felt I paid too much, I could haggle better terms next time.

But, by creating a zone system and declining to enforce it, the Panama City government has created a problem. I know for a fact that I´m being ripped off, and I feel powerless to do anything about it. That´s not how the taxis in a world-famous tourist destination should work.

Pictured: A taxi in the city of David, Panama.

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Blogger k2rbw said...

Having just returned from Panama last week and having used a lot of taxis, I would like to refute some of this.

I never 'negotiated' a fare. I know about what a ride should cost, get in the cab, tell the driver, and, when we arrive, I add another 50 cents or a buck to what I think it shoud be and hand it to him just like I know what I'm doing. I have never heard a complaint or been asked for more.

You can not compare the trip to Tocumen Airport to the Albrook Airport. Tocumen is about ten times as far and has two tolls enroute.

Yes, they can pick up other passengers but it has never happened to me.

If you can't handle 'hot and humid', do NOT go to Panama. I live in Denver (cool and dry) but have no problem in Panama. Just relax, take it slow and easy, and do not be in a rush.

If "only the wealthiest can afford a car" there must be a lot of rich people in Panama.

I do not believe that "only the poorest ride the intracity bus lines". The buses are a kick and very cheap but not very fast. The main problem is knowing which bus goes where.

Reference the comment "Consequently, there´s not a lot of available cabs". I can usually flag down a cab in under 30 seconds unless I'm in a really 'out of the way' place. In that case I usually ask someone to call a cab for me (I don't speak very much Spanish) and may have to wait 5 to 10 minutes for one.

Hint: I usually carry a map so that I can point to where I want to go BUT, as I found out the hard way, not all taxi drivers can read a map.

Enjoy Panama, it's a beautiful place and the Panamanians actually like Americans. Remember that you are the outsider guest and act accordingly. If you want things to be as they are in the States, then STAY in the States.

12:55 AM  
Anonymous Anonymous said...

I've been living in Panama for a couple of months and I now have a good idea of how much taxis should cost, but because Im particularly fair skinned (no amount of sun will tan me) I have that "fresh off the boat" look so taxi drivers loooooove trying to charge me more. My solution: negotiate price before I step into the cab. I refuse to be ripped off and if you're confident in haggling, and show them you know the price (eg. Taxi driver:"$5", me "no, demasiado caro, normalmente es $2") then they will normally take you for the fair fare. Just gotta be smart about it!

1:00 AM  

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