Beyond that period, you will need an international license valid for a year. You can obtain the international license in your own country, before leaving. The international license is a translation of your national driving license in the nine officials languages of the United Nations including English, French, Russian and Spanish.
If you are going to settle for a longer period, you will need a local license. Once you have a residency permit, you can apply at the Traffic Authority (Autoridad del Transito y Transporte Terrestre: ATTT) authorized Driver’s License Center in Albrook known as the Servicio de Emisión de Licencia de Conducir (SERTRACEN, www.sertracen.com.pa/).
To apply you will need: your passport, your home country license; a certificate of authenticity with respect to the foreign license (issued by your Consulate in Panama); an official document from the Ministry of Foreign Affairs which certifies the signature of your Consul; your Panamanian ID card (which you will receive once you are an official resident in Panama by the Department of Migration and Naturalization); blood type test results and the application fee (US$40 in cash).