Is Panama City The Next South Beach?

Outside the museum, the neighborhood offers the best of Panama City -- past, present and future. In 1671, after pirate Henry Morgan burned the original city to the ground, the King of Spain chose this boot-shaped peninsula to rebuild.

Although Casco Viejo fell into disrepair in the 1950s, today it is enjoying a revival. The two worlds meet on its labyrinthine streets: Elderly women hang laundry on wrought-iron balconies as construction workers transform dilapidated convents into swanky loft-style condos.

By sheer luck, I happen upon the presidential palace just as four magnificent herons strut across the porch. A few blocks away, at the seawall, I take in a gorgeous view of a half-dozen ships queuing up under the Bridge of the Americas.

I'm intent on finding the Church of San Jose with its Golden Altar, and as I study my map, a 30-something man named Ricardo offers his services. In most big cities, this would be the signal to sprint in the opposite direction. But with squadrons of tourist police patrolling on bicycles, I accept the invitation.

Ricardo, a native Panamanian, makes the sign of the cross as we step inside the plain white church. The interior is an odd -- even unsettling -- jumble of periods. But the baroque altar, salvaged by a priest who hid it from the plundering Morgan, is a mouth-gaping gem, an enormous mahogany piece covered in gold leaf.

Later, another local, Julio, guides me to the dungeons used first by the Spaniards and later the Colombians. One has been converted into a touristy restaurant. But Julio leads me to another. I climb through a low-slung doorway, and in the dank, poorly lighted room is a genuine surprise: paintings of every shape, color and style. Portraits of the Virgin Mary lean up against seascapes; stacked in another corner, geometric abstractions are mixed with battlefield images. Many look to be schlock, but a few are captivating.

The paintings, Julio says, are all from the collection of jailed dictator Manuel Noriega. There's no proof of this, but the dungeons are super cool and Julio and his tale -- true or not -- sure beat the standard tour guide spiel.

Tropics to Mountains

We are driving through Cocle Province, 75 miles southwest of Panama City. As we negotiate yet another tight curve, the landscape shifts from the tropical palms of the capital to the sturdy pines of this mountainous region -- all in less than an hour.

As we reach the top of one particularly steep hill, I holler, "Stop the car!" On our right, in the distance, is the Atlantic Ocean's Caribbean Sea, and to the left, down a terrifyingly steep rocky cliff, is the Pacific. We are poised on a ridge separating two continents.

There are many reasons to escape the city and explore Panama's natural wonders. But it is hard to imagine a better one than this view, arguably one of the most distinctive vantage points in all of Central America.

Farther up the slope, we reach El Valle, a town that sits inside a crater created 3 million years ago when a huge volcano blew its top. Today El Valle is one of the largest inhabited dormant volcanoes in the world. The town's fresh air, leisurely pace and cooler temperatures make it a popular weekend retreat for Panama City's elite. (Signs along the road tell the story: "Door to Paradise" and "Villa Nirvana.") Nature lovers rave about the region's hiking trails, waterfalls and horseback riding.

But the main "activities" we encounter are relaxing and eating. New Panamanian friends have arranged lunch on the patio of La Casa de Lourdes, a Tuscan-style mansion with an idyllic poolside restaurant and terraced gardens. Surrounded by Panama's leisure class, we follow their lead and order a bottle of wine. It goes well with a table full of fresh Panamanian and Creole seafood dishes accented by spice rubs, mango salsas and yucca, the ubiquitous root that locals mash, fry and even toss into cakes.