When it was set up in 1946, the School of the Americas was innocuously called the Latin American Ground School and taught good, old-fashioned nation-building skills such as well-digging and bridge-building. Within a few years, however, Cold War concerns prompted the US Government to become increasingly involved in Latin American politics, particularly around the Panama Canal. The school's curriculum added lessons in counter-insurgency and psychological warfare, sniper training and weaponry. Training manuals later made public by the Pentagon even included chapters on torture, execution and extortion.

More than 60,000 Spanish-speaking soldiers went through the school until it was moved to Fort Benning, Georgia, in 1984 (it was later renamed the Western Hemisphere Institute for Security Cooperation and now offers more PC courses on, for instance, the protection of human rights and democracy). Many of its former students, such as Manuel Noriega, Panama's de facto leader throughout the 1980s, went on to illustrious careers as dictators. (Despite finishing his 17-year prison sentence in 2007, General Noriega, now 75, is still behind bars, awaiting extradition to Panama and France where he will face more charges of drug trafficking and money laundering.)

All this was rattling around my heat-addled head as we drove towards the hotel. I tried to reason with myself: the School of the Americas left Panama 25 years ago and the five-star hotel in its place is owned by the Sol Melia hotel company, a kind of Spanish Club Med that has more than 300 hotels in 28 countries, making it the 13th-largest chain in the world.

I was starting to feel better until my travelling companions began joking about manacles in the mini-bar, drips coming from the ceiling onto our foreheads as we slept, bare bulbs lighting the cell-like rooms. As for the swimming pool we'd seen on the hotel website, let's just say the words "water" and "torture" were used in the same sentence.

As if on cue, another armed guard appeared, at the entrance to the hotel's walled compound. Was it a good thing that the hotel takes security seriously enough to issue guards with weapons, or should I have been worried that we needed a pistol-toting warden and high iron gates to sleep at night?

I decided Panama might not be the safest country in the world but it's far from being the most dangerous. Panama City looks more like Miami than the capital of a Central American country. Besides, the Hotel Melia is so, well, nice. As we drove in, well-dressed couples strolled arm-in-arm across manicured lawns, no doubt whispering Spanish sweet nothings into each other's ears. Children frolicked by the enormous three-tiered swimming pool and parents sipped cocktails on green and blue-striped sun lounges.

Everything seemed genteel and slow. Despite vast numbers of Americans visiting Panama every year, customer service seems an alien concept at the Hotel Melia. The only smiles we saw when checking in were on the badges worn by the surly staff at reception. But you can't always judge a hotel by its front desk and despite misgivings, the accommodation was supremely comfortable, if a little old-fashioned.

Each of the Hotel Melia's 285 guest rooms is decorated in Spanish mission style enormous beds, heavy ornate furniture, a curtained bathtub. There are Spanish touches everywhere like C (for caliente) on the hot tap and F (for frio) on the cold as well as everything you'd expect in a five-star hotel, from cable television, air-conditioning, wireless internet and a mini-bar (sans manacles) to key-card room entry and a telephone beside the toilet. There's a floor of 30 Royal Service rooms that include a butler and concierge service, an open bar each evening, free internet access and pillow menus.

Because the hotel isn't right inside the town and leaving involves going through a security check at the front gate, guests tend to patronise the hotel's two bars, casino, disco and two restaurants one of which, the Darien, is named after a rainforest area in Panama frequented by Colombian guerillas.

Hotel Melia's location is its main drawcard, however. In a country best known for its canal, it makes sense to stay near it and the hotel is right on the edge of Lake Gatun, which is actually part of the Panama Canal.

Banish ideas of concrete channels and freighters steaming past under your windows; only part of the 80-kilometre-long canal is like that. The rest is a pristine natural waterway surrounded by dense jungle.

Sure, you'll see large ships cruising ever-so-slowly to the next set of locks en route to the Pacific or the Atlantic but you're just as likely to see blue morpho butterflies, sloths, jungle cats and some of Panama's 900 bird species in the surrounding forests.

The hotel runs boat-based eco-tours on the lake but a quieter and much less intrusive option is to paddle your own kayak around on a guided day trip.

Its imposing buildings could definitely pass for a military complex (the hotel's press department declined to comment on whether any of the original School of Americas buildings are still standing) but overall the Hotel Melia's history seems to have been banished by its opulence and its jungle surrounds.

Just be prepared for the eerie calls of the howler monkeys, day or night. They sure can make the hairs on the back of your neck stand to attention.

Louise Southerden travelled with assistance from United Airlines.

TRIP NOTES

GETTING THERE

United Airlines flies daily to Los Angeles. See unitedairlines.com.au.

Copa Airlines, Panama's national carrier, has daily direct flights from LA to Panama City. See copaair.com.

The Panama Canal Railway leaves Panama City at 7.15am every weekday, takes one hour and costs $22 one way. See panarail.com.

STAYING THERE

Hotel Melia Panama Canal is 10 minutes by taxi from Colo{aac}n, at the Caribbean end of the Panama Canal. Rates start at $US90 ($112) a room a night, including breakfast. Phone 1800 221 176 or see meliapanamacanal.com.

FURTHER INFORMATION

Expediciones Tropicales runs guided kayaking day trips on Lake Gatun. See xtrop.com.