The government of Panama raised its 2023 growth forecast from 5% to 6%. This information comes from a recent Ministry of Economy and Finance statement.
In contrast, ECLAC predicts a 5.1% growth for Panama. ECLAC also updated its regional forecast from 1.2% to 1.7%.
Finance Minister Héctor Alexander cited various sectors. These include trade and construction. Tourism, banking, insurance, and transport also contribute.
Moreover, the electricity sector adds to this positive outlook. According to an official release, these sectors will power robust growth next year.
Additionally, new car sales increased by 22.2% in the first half of this year. The value of building permits shot up by 66.1%. Ready-mixed concrete production grew by 20.8%.
In 2021, the economy expanded by 15.8%. It grew by 10.8% in 2022. The Ministry stated that the 6% growth in 2023 would be the highest since 2014.
This follows a 17.8% drop in GDP in 2020 due to COVID-19.
For 2024, a 5% growth rate is expected. Sectors like logistics, digital hubs, and manufacturing will fuel this.
Also, tourism, construction, and trade will contribute. The Ministry added that financial intermediation and electricity will support it, too.
Background
In context, Panama’s upbeat outlook is a beacon of optimism. Especially when compared to other countries in Latin America.
This comes after a year when the nation saw significant economic downturns due to the pandemic. The swift rebound suggests underlying solid financial mechanisms.
Furthermore, the government’s optimism might attract foreign investments. It sends afina strong signals to investors about various sectors’ stability and opportunities.
This could, in turn, further boost economic performance in the long term.
However, one must exercise caution. Projected growth rates are subject to a variety of global and local factors.
These can range from geopolitical tensions to unexpected health crises. These external factors could thwart growth.