The relevance of mining in recent growth does not correspond to its fiscal importance. The political situation is impeding reforms to the pension program and to exiting the GAFI and EU gray lists.

PANAMA - Report 29 Oct 2021 by Marco Fernandez and Alex Diamond

We discuss four issues in this report: (1) the importance of copper mining, now and in the short term, for the country’s real activity, the balance of payments and government revenues, as compared with the importance of the Panama Canal (ACP); (2) the negative implications of the inclusion of Panama on the "gray lists" of the GAFI and the European Union; (3) the perspectives for the deceleration of private credit for the rest of the year; and (4) the political (dis) equilibrium between the Executive and the Legislative and its possible consequences for future fiscal and pension reforms.

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