Due to the recent strike in the construction sector, the entity has reduced projections of economic growth for this year from 5.6% to 4.6%.
However, recovery from the impact of the strike and the entry into operation of a large copper mine will lead to an upward revision of around one percentage point in the growth projection of 5.8% for 2019.
It is expected that economic growth will increase slightly to 5.1% in 2017, and about 5.5% in the medium term, supported by the expanded Canal and developing investment projects.
From a press release issued by the IMF:
Panama’s economy is expected to remain among the most dynamic in the region. The economic outlook is favorable, albeit set against the backdrop of heightened external uncertainty.
The agency highlights the country's macroeconomic stability, while noting a slight deterioration of fiscal indicators in recent years.
From a press release issued by Moody's:
New York, October 25, 2016 -- Panama's Baa2 rating with a stable outlook reflects the country's strong economy and its broad macroeconomic stability, says Moody's Investors Service.
The trade, construction, financial and real estate sectors have remained the drivers of economic dynamism in the first three months of the year.
From a report entitled "Evolution of GDP in the first quarter of 2014," by the Comptroller General of the Republic of Panama:
The implementation of road infrastructure drove the rebound in the construction sector, where business grew by 16%, while the improved performance of retail and wholesale trade was due to an increase in consumption, which is particularly visible in the volume of sales of bulk food, beverages and tobacco, materials and equipment," while in the retail trade, the increase was 9.8%, due to a rise in sales of automobiles, pharmaceuticals and fuels in the country, among other things."
The progressive completion of major infrastructure works slowed down growth in 2013 to 8.4%, below what was achieved in the previous two years.
The Panamanian economy smoothly dodged the 2008 global crisis, and has maintained a high rate of activity through the implementation of public and private projects.
"The Central American country escaped the worst of the global recession, achieving an average growth rate of 8 percent in the past six years and scoring a double-digit growth in 2011 and 2012."
"Panama is still one of the fastest growing countries in the Americas."
A mission from the International Monetary Fund (IMF), led by Corinne Delechat, visited Panama from 7 to November 18 to conduct the annual Article IV Consultation (1). At the end of the discussion, Ms. Delechat issued the following statement in Panama City:
"Panama is still one of the fastest growing countries in the Americas.
The recent increase in the value of the Costa Rican colon versus the dollar is worrisome, not only because there are no clear reasons to explain it, but also because it would be hard to contain it without causing greater problems.
In the past weeks, and without apparent reason, the price of the U.S. dollar in Costa Rica dropped considerably.
Last week we surveyed some financial operators as to why these movements where occurring, the general answer being: “we don’t know”.
For whoever wins the elections on May 3, the main challenge will be to maintain the economic growth that has averaged 8% annually in recent years.
Both the PRD (the Democratic Revolutionary Party, plus the Liberal Party and the People's Party) and Alianza para el Cambio (Democratic Change, the Patriotic Union, the Panamanian Party and Molirena), propose the continuation of the current macro-economic direction of the country, giving continuity to many of the programs conducted by the government of Martín Torrijos.
The current crisis is still unveiling and its broader regional reach and consequences are still unknown. What is known is that the impact is undeniable.
Even though the region has not experienced an immediate effect, its important to wonder how the macroeconomic adjustment may happen in our countries.
First of all, in the last years the region has experienced an improvement in its economic fundamentals, even though the external situation has dampened it, specially when compared to the rest of Latin America. This external effects are outside the reach of internal economic policy.
Generally speaking, the country risk for central american countries stays constant during the second quarter of 2008
The evaluation, done by the the most important risk rating companies, is based on the positive results reported by the treasuries of the governments, the efficient administration of public debt, and the positive macroeconomic stability of the region.