A “surge in trade” and government investment in infrastructure will make Panama the fastest-growing economy in the region, Panama Finance Minister Dulcidio de la Guardia said in an exclusive interview with the Bloomberg news service.
He expects the economy to grow by 5.8 percent in 2017, which would far surpass any economy in the region. His comments are slightly more optimistic than the International Monetary Fund’s recent outlook, which predicts a 5.1 percent increase this year.
Either way, it’s clear Panama’s economy is hitting on all cylinders.
“We are seeing an acceleration in the economy, product of the Panamanian economy being highly open and very tied to global growth,” de la Guardia told the news service. “The global perspectives are much better this year than last year and that is generating a cascade effect in Panama, increasing the demand for Panamanian services.”
The “Trump Effect”—the impact of Pres. Trump’s policies on global trade—is unlikely to derail Panama’s growth, he says.
“There has been a lot of rhetoric about the topic, but very few concrete policies,” De la Guardia said of Trump’s trade plans. “We think the cloud over global trade is going to dissipate and that should generate greater volumes of global trade going forward.”
The expanded Canal will play a big role in the growth, with a new toll structure and growth in tonnage expected to aid a 50 percent increase in government revenue, to $1.6 billion for the year, he said. The Canal accounts for about 7 percent of revenue, and will finance infrastructure projects, including “a $1.86 billion metro line to be completed in 2019 and the $800 million expansion of the Tocumen International Airport,” Bloomberg reports.
The economic forecasts provide solid evidence for bullish predictions about Panama’s real estate market. Panama’s business story is not based on speculation—it’s the product of solid financial fundamentals, which appear set to continue in the future.