sensible solution

In Panama, a new law would provide land for squatters, reports
La Estrella (the Panama Star). The idea is to pay landowners a fair price, then extend infrastructure and sell the land to the squatters. But the proposal doesn't address the groups that might be the majority of squatters, who have settled in parks and on other federally reserved land. They would be evicted under the proposal, housing minister Gabriel Diez said.

And here's another complication, as reported by the Star:

For many years squatters have invaded prime plots of land all over the country. The majority of the properties around the Pacific coast of Herrera, Veraguas and Los Santos do not have titles, just possessory rights, because nobody really knows who the owners are.

The proposed squatters bill will help to a certain extent to solve the housing problem in Panama, but on the other hand what will happen to those owners who want their land back to build a resort, or want to sell it to a third party or keep it within a family, will the government make those people sell it or evict the squatters.