Top experiences in Casco Viejo, Panama City's most atmospheric neighborhood

Building a cross-country canal to link the Pacific and Atlantic oceans was always an ambitious idea, not to mention a poorly-planned one. Work started on this iconic waterway in 1880, but by the time it was completed in 1914, some 25,000 people had died, mostly from tropical diseases.

Today, however, this feat of engineering is the country’s star attraction, and it's one of the top sights in Panama City. You can learn more about it without leaving Casco Viejo at the Interoceanic Canal Museum (also known as the Panama Canal Museum) located in one of the neighborhood’s most handsome historic buildings, dating back to 1874.

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Just walking around Casco’s cobblestone streets is a rewarding activity all by itself. Dotted around the four palm-lined avenues and four main plazas – Plaza de la Independencia, Plaza Herrera, Plaza Bolívar and Plaza de Francia – are crumbling buildings thirsty for a fresh lick of paint, alongside historical structures reimagined as apartments and boutique hotels.

For a meal or refreshing drink, pop into Hotel la Compañia, originally built as a Jesuit convent in 1688, or the American Trade Hotel, which was once the tallest building in Panama City, despite topping out at just three stories.

Along with sharp contrasts between elegance and decay, strolling in Casco is delightful due to the mural-lacquered walls created by Rolando “Rolo” de Sedas, a Panamanian artist known for transforming urban spaces with colorful patriotic iconography.

Casco is also safe to walk around and despite the area being a tourist hub, you won't find hawkers on every corner, so you're free to enjoy the ruins, street art and cool cafes in peace.

There’s coffee and then there’s Geisha coffee, Panama’s most-prized brew – one of the world’s best and most expensive cups of Joe. Originally brought over from Ethiopia, Geisha coffee beans were found to thrive in Panama’s humid climate, particularly in the high-altitude Chiriquí region.

But you’ll have to save your dollars to enjoy it – batches of Geisha coffee have sold for as much as US$2,568 per pound. In Casco, you can sip the champagne of coffees at Café Unido or Tiempos located within American Trade Hotel at Plaza Herrera.

Pedro Mandinga is Panama’s first artisanal craft rum distillery, as well as being the first dedicated rum bar to open in Casco Viejo. Tropical print armchairs, rattan ceiling fans and vintage salsa records make this an easy spot to while away an afternoon (happy hour runs daily from noon to 6pm).

Before ordering your drink, ask to sample the silver and spiced house rums made with Raspadura pure cane sugar. The menu boasts a great collection of cocktails, but nothing beats the Mandinga mojitos.

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Worn by everyone from gold rush pioneers to US presidents, not to mention spies the world over, the Panama hat has become synonymous with this Central American nation. Actually Ecuadorian in origin, these straw hats are sold everywhere in Panama City, with prices starting from US$15 at street stalls to US$800 in shops.

As a guide for purchasers, the tighter the weave, the pricier the hat. At Victor’s Hats, rows of shelves display a variety of styles and colors. If in doubt, stick to the classic style in natural tones.

Casco’s characterful streets are packed into a small peninsula that juts out into the Pacific, and the sea views from here are impressive, with giant ships waiting to pass through the canal against the modern downtown skyline.

The best outlook is from Paseo Esteban Huertas, a pretty promenade built atop the old city’s outer wall. Under a canopy of bougainvillea, this scenic path runs from Plaza de Francia to the former Club Unión member’s club, which stood in for a Bolivian villa in the Quantum of Solace Bond movie. Along the waterfront, Kuna women sell the embroidered molas (handmade textile panels) for which the country is famous.

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Mercado de Mariscos is Panama City’s ever-lively fish market, located at the start of Cinta Costera, a palm-fringed waterfront boulevard. Stalls display huge spiny lobsters on ice, filleted fish neatly stacked and freshly caught shrimp piled high.

It’s a fun music-filled spot for lunch where the catch of the day can be bought and cooked to order at the restaurant upstairs. Don’t miss the citrus-sharp ceviche, served heaped into Styrofoam cups. This popular order is best paired with an ice-cold beer.

Casco is the city’s nightlife hub, with an impressive number of rooftops where you can enjoy Panama’s year-round warm weather. Capital Bistró Panamá – the first rooftop you see as you enter the historic district – gazes adoringly over the Bay of Panama and is practically perched on the water.

Lazotea, which sits atop the stylish, boutique Hotel Casa Panama, offers sparkling skyline views and a chance to dip in the pool between beverages. It was the first rooftop in the old town to have its own pool.

Night owls should make a beeline for the rooftop at Selina which also has a pool and a healthy roster of events and live music nights. As Casco's first rooftop bar, Tantalo is eternally popular, while Casa Casco is where well-dressed Panameños go for 360° views of the city and the bay.

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Pop into Iglesia de San José to spot real-life treasure in the form of the Altar de Oro (Golden Altar). Legend has it that when Welsh privateer Henry Morgan attacked Panamá Viejo – the original Panama City – in 1671, Jesuit priests painted the altar black to disguise it and told Morgan that another pirate had already stolen it.

The baroque altar was later moved from Panamá Viejo to Iglesia de San José in Casco Viejo where it stands today. It’s the only relic to have been salvaged from that devastating attack and it's the highlight of this historic church.

To sample local fare, don’t miss a stop at Fonda lo Que Hay, for soul-nourishing and highly photogenic updates of traditional Panamanian cuisine. This is hands-down one of the best restaurants in Casco Viejo, with top restauranteur José Olmedo Carles Rojas working diligently at the helm. Try the deliciously-dressed patacones (twice-fried plantains) or whatever else is available – the menu changes frequently but it’s always exquisite.

To feast on several of Panama’s national dishes under one roof, Diablicos is your best dining option in Casco. There you can enjoy hearty sancocho, a broth of chicken, corn on the cob, starchy vegetables and cilantro, or ropa vieja, a shredded meat dish whose name translates to “old clothes.”

On certain evenings, the restaurant puts on a showstopping show featuring singing, dancing, drumming and diablico sucios (dirty devils) – prominent characters in Panamanian folklore.