News

A new report from Bank of America (BofA) highlights Panama’s positive progress in several key economic areas, including higher-than-expected growth.

The report notes that Panama’s economy has remained resilient, despite a wide array of geo-political challenges affecting countries around the globe. Improvement in fiscal results is helping give the government of President José Raúl Mulín more room for political initiatives, which should help the country maintain its growth, the bank’s analysts note.

In defiance of numerous headwinds, Panama’s economic activity surprised analysts by growing 3% in 2024, even with the disruption caused by the closing of the Cobre Panamá mine in November 2023. BofA projects a growth of 3.9% for 2025, illustrating that the mine issue is fading into the rearview mirror.

BOA also highlights the stabilization of the fiscal deficit and restrictions on public spending, which should help the government’s fiscal policy in the long term. 

“The administration of José Raúl Mulino has improved the quality of fiscal statistics and has a more favorable discourse towards fiscal consolidation compared to his predecessor, Laurentino Cortizo,” the report states. Mulino campaigned on the slogan, “An obese government scares private investment,” coverage in El Capital Financero notes.

Pension reform and the possible reopening of the mine are also potential catalysts for future growth. Public opposition to the copper mining operation has dropped from 80% to 90% in 2023 to 50%, which could open the door for a major jolt to the economy.