Panama ( PAN-ə-mah; Spanish: Panamá [panaˈma]), officially called the Republic of Panama (Spanish: República de Panamá), is a country in Central America. It is bordered by Costa Rica to the west, Colombia (in South America) to the southeast, the Caribbean Sea to the north and the Pacific Ocean to the south. The capital and largest city is Panama City, whose metropolitan area is home to nearly half of the country's 4 million people. Panama was inhabited by several indigenous tribes prior to settlement by the Spanish in the 16th century. Panama broke away from Spain in 1821 and joined a union of Nueva Granada, Ecuador, and Venezuela named the Republic of Gran Colombia. When Gran Colombia dissolved in 1831, Panama and Nueva Granada remained joined, eventually becoming the Republic of Colombia. With the backing of the United States, Panama seceded from Colombia in 1903, allowing the Panama Canal to be built by the U.S. Army Corps of Engineers between 1904 and 1914. In 1977 an agreement was signed for the total transfer of the Canal from the United States to Panama by the end of the 20th century, which culminated on 31 December 1999. Revenue from canal tolls continues to represent a significant portion of Panama's GDP, although commerce, banking, and tourism are major and growing sectors. In 2015 Panama ranked 60th in the world in terms of the Human Development Index. Since 2010, Panama remains the second most competitive economy in Latin America, according to the World Economic Forum's Global Competitiveness Index. Covering around 40 percent of its land area, Panama's jungles are home to an abundance of tropical plants and animals – some of them to be found nowhere else on the planet.
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