Although the controversial Brazilian company, accused of having developed a worldwide corruption network, had interests in several Latin American countries, it was in Panama that a large number of its projects were concentrated, ranging from the urban renewal of Colón, currently under development and with a estimated value of $500 million, to the contract to build the hydroelectric station Chan II, estimated at $1 billion and recently canceled by the Varela administration.

See: "No More Business for Odebrecht in Panama"

In its analysis Moody's describes how, in the case of the hydroelectric construction project, "... the start of construction was planned for 2015, and the generation of energy scheduled to start in 2020, but no great progress has been made since last year." The agency also warned that financial institutions have been investigated for links to money laundering, referring to the intervention by the banking regulator of FPB Bank."

See "Odebrecht: An Open Secret"

"... The Odebrecht scandal will have negative implications for short-term growth in several Latin American countries ... This is significant in a region that had begun to recover from an impact on trade, but particularly in Peru, Colombia and Panama."

Prensa reports that "...In addition to the cancellation or postponement of investment projects, the agency refers to other possible negative impacts that could be linked to "political noise", as happened in Brazil during the Lava Jato investigations, which could affect business confidence and the investment climate".

Source: Prensa.com

More on this topic

Odebrecht's Hydroelectric Concession Recalled

January 2017

The construction company has one week to respond to the proposal put forward by the Panamanian government, which is geared towards cancelling the award of the Chan II hydroelectric station at no cost to the State.

The Ministry of Finance submitted the proposal to the Brazilian construction company on January 26, and it has one week to respond and start to coordinate the withdrawal from the construction project on the dam now known as Bocas del Toro.

Odebrecht Downrated Again

January 2017

Fitch Ratings has downgraded Brazilian construction firm from B- to CC, arguing that the revelations about bribes "have exacerbated its reputational risk".

From a press release by Fitch Ratings:

Fitch Ratings-Sao Paulo-17 January 2017: This is a correction of a release published Jan. 17, 2017. It corrects the rating for the USD800 million senior unsecured notes due 2023.

Odebrecht's Financial Picture Gets More Complicated

October 2016

Moody's has downgraded the Brazilian construction company and does not foresee its financial profile significantly recovering over the next 12 months.

The construction company is currently running three major projects in Panama: the urban renovation of Colon, with a value of $537 million, the construction of Metro Line 2, for $1.8 billion, and the expansion of Tocumen International Airport. 

Doubts Over Tender for Urban Renewal of Colon

June 2015

The Housing Ministry is evaluating the possibility of suspending the award ceremony scheduled for June 26 because Odebrecht is part of one of the three consortia who are participating in it.

Friday June 26 is the date when the contractor of the works for urban renewal in the city of Colon should be announced, a project estimated at $500 million, but the act could eventually be canceled or postponed depending on the conclusions reached by the Housing ministry in its evaluation of the situation.