Panama’s economy will rebound quickly in 2021 and post growth of 5.1 percent, far above most countries in the region, according to the World Bank.
The predicted 5.1 percent surge should dramatically outpace the rest of Latin America and the Caribbean, the Bank predicts in a newly released report. Brazil, for example, is expected to grow by 3.0 percent, Chile by 4.2 percent, and Mexico by 3.7 percent.
Panama has several factors in its favor, which will help it recover quickly, analysts agree. The Panama Canal, the new Cobre Panama mine, a strong base of multinational companies, and a menu of in-progress infrastructure projects provide Panama with a strong foundation to handle a global crisis better than most countries.
Overall, Central America will see “a modest recovery to 3.6 percent growth is projected for 2021 as restrictions are relaxed, vaccine rollouts gather pace, oil and metal prices rise, and external conditions improve,” the World Bank reports. Latin America and the Caribbean combined will likely grow 3.7 percent, after an extended “sluggish” period, with many economies hard hit by the pandemic.
Panama’s performance is also expected to outpace the global recovery. The global economy is expected to expand 4 percent in 2021, “assuming an initial COVID-19 vaccine rollout becomes widespread throughout the year,” the report says.
While every country suffered, the global economic performance in 2020 was not as bad as originally expected. “The collapse in global economic activity in 2020 is estimated to have been slightly less severe than previously projected, mainly due to shallower contractions in advanced economies and a more robust recovery in China,” the World Bank reports.