New government data shows the surge in Panama’s economy in the first half of 2021 was led by a diverse group of sectors, including construction, mining, and trade activity.
The National Institute of Statistics and Census (Inec) reports that several industries posted significant growth as the country reopened, reflecting the overall strength of Panama’s economy. Overall, the economy grew by 10 percent, a good sign for future expansion as the region continues to reopen.
The activity was recorded over diverse areas of the economy, not simply the Panama Canal, which provides a strong foundation for international trade. The data reflects the return to activity of the Cobre Panama mining operation, which helped lead mines and quarries to a 178% growth. The mining operation will be a key driver in Panama’s future economy, generating revenue that will help finance many public works projects, and its return to operation was a huge plus for the country’s economic output.
But several other sectors also posted growth, suggesting the overall economy was also finding its footing in the first half of the year. Construction activity increased 10.5%, during the first six months of the year. In the second quarter, several public civil engineering projects restarted, “showing a progressive recovery of the sector that was seen severely impacted by the COVID-19 health crisis that affects the country,” El Capital Financero reports.
Trade and logistics activity increased 7.5% from January to June 2021, led by the Canal. In the second quarter, Canal toll revenues increased by 20.2%. In the ports, TEU’s container traffic grew by 17.0%, bulk cargo by 13.2%, and general cargo by 222.2%, the paper reports.
Air transport, telecommunications activity, and whole and retail trade also increased during the first half, according to the government data.
International analysts expect Panama’s GDP to continue to grow into 2022. Moody’s recently reported that Panama’s economy should reach pre-pandemic levels by the end of 2022. Fitch Ratings recently forecast a 5.8% growth in Panama’s economy in 2002.