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COUNTRY INSIGHTS

The fiscal deficit deepens in the first half of 2023. The political scenario remains uncertain until the September deadline for alliances
PANAMA · Report · 29 Aug 2023 · 1 response

The official data for the first half of 2023 reveals an increase in the deficit compared to the previous year. However, these figures do not account for expected dividends from the Panama Canal, potential new royalties from the pending mining contract approval, or projected funds from land sales ...

Mid-term report: Good numbers but not on the Dean's List. Cabinet approves the 2024 budget. Microchips enter the economic scenario.
PANAMA · Report · 31 Jul 2023

GDP growth for 2023 is expected at 6.2%, driven by internal demand, mainly consumption. The medium-term GDP projection has a less rosy outlook due to the likely end of the impact of the sharp Colon Free Zone sales to Europe in 2023, as well as mining output effects. Employment remains steady, but...

Ricardo Martinelli found guilty of money laundering in the New Business trial
PANAMA · In Brief · 18 Jul 2023

Former President Ricardo Martinelli (71) was sentenced to 128 months in prison, along with a fine of 19 million dollars, and the transference of the shares of EPASA to the government. EPASA is the holding company that owns two newspapers in Panama; its purchase by RM, presumably with money from p...

Growth exceeded our previous forecast for 2023, but in 2024 it will slow, regaining traction in 2025. Fiscal figures will be favored by Minera Panama's new royalties. Ricardo Martinelli's trial faces a verdict in early July
PANAMA · Forecast · 03 Jul 2023 · 1 response

Growth in the first quarter of 2023 exceeded expectations, much like analysts' forecasts for the global economy. According to our estimates, Q1 GDP may have grown between 9-10%, similar to the year-over-year increase of the Monthly Economic Activity Index (IMAE) through February. The resilience s...

A light at the end of the tunnel of a poor international reputation: the possible exit from the FATF gray list
PANAMA · In Brief · 23 Jun 2023

The Ministry of Economy and Finance announced today that the FATF-GAFI has approved an on-site visit to showcase the country's progress in implementing FATF recommendations. The country has achieved a "largely compliant" rating in all actions of the agreed plan with the FATF to address deficienci...

April's revenues disappoint. Martinelli faces a key trial for his political career. A new player: left-leaning economist Maribel Gordon is currently the third independent candidate for the presidency.
PANAMA · Report · 23 May 2023

The NFPS deficit in the first quarter exposed a shortfall in tax collection due to a decline in government revenues. Government expenditures continued to rise, while sales tax revenues fell below expectations, the budget, and last year's performance. The authorities provided a partial explanation...

Unions take the initiative in pension reform, ACP land-buy delay, Torrijos to run in 2024, and civil forfeiture draft rejected (another setback for Cortizo)
PANAMA · Report · 01 May 2023

Last week, CONATO, the country's most powerful union association, presented a proposal to the Legislative Assembly to solve the short-term cash deficit of the defined-benefits sub-system (SEBD) by consolidating its assets with those of the private account sub-system. We analyze the implications ...

The board of directors of GB Group Corporation (Global Bank's full owner) decided to buy the shares of Ricardo Martinelli, his family, and their companies for not meeting the criteria of "moral solvency"
PANAMA · In Brief · 18 Apr 2023

Summary of facts and implications of Martinelli´s exit as shareholder of Global Bank, S.A. On March 28, 2023, the Superintendency of Banks of Panama (SBP) issued the Agreement 002-2023 which established that banking entities “must guarantee that shareholders and senior management maintain an exce...

Potential growth slows. International reserves are solid in the face of the recent external financial turmoil. The dispute between Legislative and Executive continues, raising questions about the discussion of the Minera contract.
PANAMA · Report · 04 Apr 2023

The IMF March report projects 5% GDP growth for 2023 and 4% growth thereafter. Potential growth decreases to 4% from 6%, a result of the fall in total factor productivity in recent years. The weakness of taxation performance calls for a profound reform of the system and a revision of the size and...

Slide presentation: Panama - Economic outlook 2023: Real and fiscal issues
PANAMA · Report · 10 Mar 2023 · 1 response

Get insight into Panama's macro outlook with the slides from Marco Fernandez's presentation, "Panama - Economic outlook 2023: Real and fiscal issues".

Details of Minera Panama´s new contract remain secret. Implementation of the new base year improves the fiscal ratios slightly. The political scenario heats up fifteen months before the general elections.
PANAMA · Report · 01 Mar 2023 · 1 response

February is coming to an end, and there is no official indication that the conclusion of the new agreement between Minera Panama and the Executive will be reached in the coming weeks. The company indicated that it would phase down its mining and export operations and suggested that direct employm...

Uncertainty persists in the stalled contract negotiations regarding the copper mine, and the US State Department might redraw the political map
PANAMA · Report · 01 Feb 2023

The contract negotiations between the government and First Quantum, the owner of Minera Panamá, are still not progressing. The main pending disagreements are royalties and depletion deductions, the scope of the easement, the procedure by the state in the event of the administrative termination of...

Growth outstrips consensus; new U.S. ambassador stirs the pot
PANAMA · Report · 29 Dec 2022 · 1 response

The official figures for economic activity published last week beat the consensus by a wide margin. Real GDP may increase 9%, higher than the 7.5% forecasts of rating agencies, private analysts, and international organizations. The sectors that most contributed were the traditional ones: wholesal...

Cortizo announces the intervention of the government in the commercial operations of Minera Panama, stopping production without a timetable to resume sales
PANAMA · In Brief · 16 Dec 2022

The Cabinet approved yesterday Resolution 144 that instructed three Ministers (Labor, Environment, and Commerce) to intervene in the operations and commercialization of copper mining in northern Panama after the failed renegotiation of the existing contract between Minera Panama (a subsidiary of ...

The 2023 NFPS budget and third quarter fiscal data hide revenues and expenditures. The economy continues to accelerate.
PANAMA · Report · 01 Dec 2022

The overall government budget for next year is US 27.6 billion. Because of the state accounting system in Panama, this figure includes US 3.2 billion for state-owned banks (which are independently managed and not subject in practical terms to budget restrictions), as well as US 3.5 billion in int...

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