Panama shows positive indicators in its economy

 Posted on 2023-06-16

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(Panama City-ANPanama) Panama shows positive economic indicators, assured the Minister of Economy and Finance, Héctor Alexander, who explained that the economy has had a strong recovery, generating formal jobs, managing to reduce poverty and with one of the lowest inflation rates in the world.

The official presented a report on the situation of the economy and public finances, noting that the latter entered the path of fiscal consolidation; He said that the economic prospects are favorable for the country and that in 2023 Panama has complied with 15 actions of the FATF Plan to get out of this organization’s gray list this year.

Regarding public finances, he explained that the strategy of this administration has focused on the fact that the modifications to the Fiscal Social Responsibility Law allowed increasing income from debt flows, to attract more money to the Panamanian economy as an important action in the implementation of the policy. of stabilizer.

The minister indicated that in this regard the current administration has always implemented a strategy even in the most critical moments of the pandemic, to achieve favorable results and never improvised.

He also highlighted that public finances are consolidated after years of uncertainty that was experienced as a result of the pandemic with the drop in current income, which he indicated is increasing with a higher percentage of savings.

The minister pointed out that one of the most important aspects in the consolidation of public finances is that Panama appears as one of the countries with the least risks, which translates into investment attraction and better ratings from international organizations.

On the other hand, he indicated that the Panamanian economy had been in decline from 2011 to 2020, and that it is from 2021 and 2022, post-pandemic, that the country grew 15.8% and 10.8% respectively, one of the highest increases in the region. He highlighted that this growth in 2021 and 2022 is greater than the overall growth of Latin America and the Caribbean.

According to the minister, the sectors that have contributed the most to this growth are commerce with 28.4%; construction 22.6%; transport and storage 14.1% and mining 2.4%.

Minister Alexander’s report indicates that the economic recovery has had a favorable impact on employment, with 92% of the jobs generated coming from formal employment. He specified that from September 2022 to April 2023 the employed population increased by 214,672 with an increase of 13.2% while formal employment increased by 196,738 with a 21.6% increase. He added that the unemployment rate decreased 8.6%, that is, from 18.5% in September 2020 to 9.9% in April 2022.

On the other hand, he said that Panama reduced general and extreme poverty particularly in regions such as the Ngabe Buglé, Guna Yala and Emberá regions as well as in the province of Darién. He indicated that these poverty reduction reports are based on reports from the MEF and international organizations that have compared the figures for the region.

Alexander highlighted that the country is considered among the nations in the region with high human development along with Chile, Argentina, Costa Rica and Uruguay, which translates into attraction to foreign investment.

The report compares that Panama has a consumer price index of 2.9, below Latin America and the World. He adds that this index is also below that of the United States and the European Union.