Construction: a sector that is beginning to gain momentum in Panama

Between January and September 2022, the cost of construction, additions and repairs grew 21.6% in Panama, which reflects an improvement compared to the accumulated figure of the previous year.

The construction industry continues to be a sector with growth potential, with the capacity to continue growing and supporting the generation of jobs, although to achieve this it requires higher levels of investment, both public and private, said the president of the Panamanian Chamber of Construction (CAPAC), Carlos Allen.

During the recent CAPAC Expo Hábitat fair, held last September, the block and cement industry showed its drive by achieving mortgage transactions for US$149 million, exceeding the expectations of the exhibitors, achieving the sale of more than 1,700 housing units.

With an attendance of more than 12,000 people, 85% of the sales corresponded to homes that are located in the preferential interest rate range whose value is between US$40,000 and US$180,000, while 15% corresponded to to higher amounts.

Within the percentage composition of the Gross Domestic Product (GDP) of the construction sector, it is observed that the contribution went from 8.7% in 2020 to 10% in 2021, but still below the levels of 2019, before of the pandemic.

“The behavior of the industry in which we work is cyclical. To make its recovery sustainable, we must implement actions and resume others to encourage private investment which, together with greater investment in public infrastructure, as other countries are doing, is key to generating more labor,” Allen said during a conference.

In order to achieve sustainable growth in the sector, he said that government entities must expedite pending payments for progress of works to state contractors and suppliers, as well as promote the activation of turnkey projects and public-private partnerships.

Referring to the cost of construction, additions, and repairs, the CAPAC president stated that a varied behavior was observed in 2021, reflecting the importance of public-private partnerships to boost the sector.

Statistics indicate that from January to September 2022, the cost of construction, additions, and repairs totaled US$654 million, while for the years prior to the pandemic, this was US$884.4 million and $993.3 million in 2018.

Between January and September 2022, the cost of construction, additions and repairs grew 21.6%, which reflects an improvement compared to the accumulated figure of the previous year.

The projections for 2022 seem favorable for the country, with prospects for economic growth of 5%, although international organizations such as the Economic Commission for Latin America (CEPAL) place it at 7%.

In Panama, construction, wholesale and retail trade, logistics, hotels and restaurants are considered key activities for the national economic recovery, without neglecting the joint work between the public and private sectors.

Eager to boost activity, the construction industry is preparing to hold its Expo Vivienda between April 20 and 23, 2023, as well as CAPAC Expo Hábitat, from September 28 to October 1 of the coming year.

With information from Bloomberg Línea