There are two kinds of buses in Panama: the ones you find on the highway, and “city buses” (Metrobuses, which replaced the Diablos Rojos (Red Devils).
The highway buses are constantly making journeys from terminals in Panama city to different destinations along the Pan American Highway, and back to the terminal. They’re pretty frequent, and the buses will pick you up or drop you off at any point along their route, and most of them are air conditioned. The roughly linear shape of the country makes it ideal for a bus system, so ideal in fact that you don’t really need to rent a car to get around most areas. Take a bus to the intersection on the Pan American highway that you want. You can get on a bus any place on the Pan American highway going towards Panama City, but all trips originating from within the city require a ticket. The Grand Terminal in the city is large and modern, and will remind you of an American shopping mall or airport (it actually is a shopping mall, Albrook Mall, too). Schedules for all Panama are listed here.
The highway buses are very cheap, count on a fare of about US$1 per hour traveled, sometimes less. One exception is fares from Tocumen airport, firy which both buses and taxis charge through the roof (by Panamanian standards), simply because they can.
If you want to get on a bus, stand by the side of the road, hold you out your arm and make obvious pointing motions toward the ground. If you’re on the bus and want to get off, yell “parada!” or tell the driver in advance. You’ll get the hang of it pretty quick. The locals are very helpful with tourists on buses, and may offer help.
Never ask for the fare in the bus: the bus drivers will most certainly always round up numbers in that case. Instead, know the fare beforehand (by asking the locals) and give the exact change. Or give a round number and look as if you expect change or demand it holding your hand forward, pretending to know the right fare.
Inaugurated in 2014, the Metro de Panama is now one of the major means of transportation for many locals. A single ride costs $0.35; you can pay with a Metro card which you can buy at any of the stations for $1 (the same metro card works for both the Metro and the Metrobuses. The Metro de Panama operates M-F from 5AM until 11PM, Saturdays from 5AM until 10PM, and Sundays from 7AM until 10PM.
The Metro de Panama has two lines:Line 1 starts from the Albrook Bus Terminal, with stops at Iglesia del Carmen and Via Argentina connecting you to the city center. Line 1 is connected to the Line 2 (inaugurated in mid-2019) through the San Miguelito station. The Line 2 passes through major parts of the Via Jose Domingo Diaz or the Via Tocumen, but it does not stop at the Tocumen Airport.
Follow general safety guidelines while riding the metro during peak and off-peak hours.
If your destination is far off the bus route, or if you just want to be lazy, taxis are also a decent way to get around in Panama. Taxi rates are negotiated and vary depending on location. Most short taxi rides are $2.50 and going across town is about $5. Unlike the urban taxis you may be used to, they can take you way out into the country.
A taxi ride from Tocumen airport to Panama City, at a minimum of $30, can easily exceed your taxi fares for the rest of your trip combined. If you share a taxi ride with other passengers going from the airport to the city, your fare per person can be cheaper, at around $12. You can save quite a bit of money by taking the bus to the Gran Terminal, but even the bus fares will be higher than normal.
Panama can easily be discovered independently. The road system of Panama is in very good condition (for Central and South American standards). You can rent a car and drive it around the country if you are an excellent defensive driver. While traveling by car you can discover attractions that are hard or impossible to reach with public transportation.
Panama City is more difficult to navigate than any big city in the United States, with terrible traffic jams at rush hours, few signs for names of streets, poor street design, and a lack of traffic lights at busy intersections. You must be aggressive about positioning your car to get anywhere, yet highly alert to erratic and irrational behavior by others. Drivers have little respect for or even knowledge of traffic laws, and drivers from North America or Western Europe will be stunned by their recklessness. In the rest of the country, driving is mostly stress-free.
The Pan American Highway is paved for the entire length of the country, and has many roads which branch off to towns off the highway, most of which are paved, and most of the rest are still easily navigable in a sedan. However, road engineering standards are low, so be on the lookout for off camber turns, deep potholes, and sharp turns with no warning. It is highly recommended to drive well informed about your route. Use the detailed information which cochera andina provides on its site when planning your trip and check out road conditions, distances and travel times. On the road, don’t forget to take also a good road map with you.
For driving in Panama you need the driver’s license of your country but to avoid trouble at police controls it is better to have an international driver’s license with you as well. The traffic rules are almost the same as in Europe or the U.S. Road signs are frequent. The speed limits are 40 km/h within cities, 80 km/h outside and 100 km/h on the highways. You will find gas stations all over Panama. A lot of stations are open around the clock. Three types of gasoline are available: unleaded, super and diesel.
For driving in the Corredor Sur and Corredor Norte highways, both toll roads, the only accepted payment method is the Panapass sticker; not having one will incur in a fine.
Local airlines serve many airports in Panama. Aeroperlas and AirPanama are the two local companies. Flights leave Panama City from Marcos Gelabert Airport in Albrook.
Private aircraft charters are available through online and local companies.
It is advisable to check the tail number of any aircraft chartered in Panama. All registered aircraft authorized for public charter work (air taxi) will have a letters after their numeric tail number (e.g., HP-0000TD). This signifies the aircraft is insured for charter work and is subjected to more inspections and increased maintenance requirements.
Take the Panama Canal Railway from Panama City to Colón or vice versa. The first train made this trip in 1855 (though the line has since been abandoned and rebuilt in standard gauge) and it was the first interoceanic railway in the Americas, predating the transcontinental railroad in the US by a decade and a half. While the primary purpose of the railroad is the cargo business, a passenger train runs once per day and direction and is very much marketed as a luxury train, trying to justify the $25 one way fare.