With cities reminiscent of mini-America and a currency in-line with the US dollar, it is hardly surprising that Panama is not the place for budget backpackers. Whilst the beer remains cheap, and transport reasonable (especially considering the standard of buses), accommodation takes a steep incline leaving little option other than to bunker down in a dorm.

Stick to cooking in your hostel or cheap local eats to make the food budget go that little bit further!

The costs below are the average we encountered in our time in the country, and the individual items have been chosen for their ubiquity across the world and their popularity amongst backpackers. This will allow us, and you, to make a comparison of living and travel costs across Latin America.

Currencies are £GBP / $USD. Conversion rate as at time of publication.

average daily cost for two budget backpackers

$45+ / £30+

Fortunately, the majority of our time spent in Panama was enjoyed without relying on our meagre backpacker budget - family were visiting and so we had almost no accommodation costs for our time in the country.

Our daily budget is therefore not reflective of the true costs of visiting Panama. However, from out time there, we would expect to our daily budget of £30/$45 to be really stretched - and that is without doing a number of activities.

5 hour bus ride

Split between smaller collectivo vans and more luxurious long-haul buses, travel in Panama is usually much more luxurious than other Central American buses.

$10 / £6.60

average cost of one dorm bed per night

$13.80 / £9.11

basic breakfast out for one

We're talking gallo pinto, eggs, cheese and coffee - simple but delicious!

$3.50 / £2.30

one litre of water

Just remember that it is actually safe to drink the tap water here!

$1.2 / £0.80

one banana

In addition to Costa Rica, a lot of the worlds bananas come from Panama.

$0.15 / £0.10

cup of coffee

The cost of coffee varied wildly in Panama. From the Starbucks inspired latte around $3 to the cheap filtered cup of joe you can find on the street for less than a dollar!