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Home to half of Panama鈥檚 population, Panama City is a heady combination of historic crumbling colonial buildings and high-rise ultra modern structures, set around a large bay on the Pacific Ocean.

In some ways the city combines three cities in one. The first impressions are usually of the sleek and prosperous infrastructure of the business and entertainment districts, a vibrant, sophisticated and truly international commercial hub that exists largely to serve the neighbouring canal. Beyond this, at the extreme southwest of the bay, Casco Viejo is an attractive district comprised of beautiful 17th and 18th century churches, where convents and museums are interspersed with stunning colonial mansions built by the Spanish and French.

Colonial trade

Drawing from a period still further in the past is Panama Viejo, the original ruins of the capital founded in 1517 by Pedrarias Davila and quickly became an important geographic location for colonial trade. It is estimated that during the 16th and 17th centuries, 60% of all American silver went through the city which also operated as a connection point for inter-American trade.

Old Panama

Panama Viejo (Old Panama) was the first city to be built on the Pacific coast of the Americas and started out as a handful of simple huts. Stone was already used at the end of the 16th century but only for government buildings, churches and the best houses. In 1671 the city was attacked by Welsh pirate Henry Morgan and the city left in ruins. Two years later it was moved to what is now known as Casco Antiguo, abandoning the old site of the city for over two centuries.

This old city centre has plenty of charm and a diverse selection of museums, colonial churches and 19th century mansions all painted in an array of different colours. Casco Antiguo is home to the presidential palace and was declared a UNESCO World Heritage Site in 1997. Although Casco Antiguo is a poor neighbourhood, the area is slowly being restored and regenerated.

At night it is the city鈥檚 causeway that comes alive with locals and visitors gathering for drinks at sunset overlooking the entrance to the canal, and dinner among the candlelit restaurants.

Today, Panama City is by far the most modern city in Central America, helped by the fact that it lies outside any earthquake and hurricane zones.