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 Economy in Panama
The investment in residential projects increased 22.9% last year, the Ministry of Economy and Finance reported today. According to a report from the Department of Economic and Social Analysis of the MEF in 2010 the investment per square meter for residential projects was $489.01, while in 2009 the investment was $397.86. The total number of residential construction projects rose 21.9% in 2010 due to the stabilization of the construction industry in Panama, which returned to more intense activity in these types of projects, as a response to the housing shortage in houses and smaller buildings with lower construction costs, according to the official report. The increase in investment per square meter in these types of projects, those areas reporting the greatest increases above the 22.9% average were in the districts of San Miguelito (78.1%), Panama (31.1%), Chitre (25.9%) and Santiago (23.2 %). The overall number of residential construction projects increased Aguadulce (92%), La Chorrera (58.1%), Arraiján (31%), Panama (24.4%), Santiago (9.4%), Chitre (7.8%) and San Miguelito (6.9%). The district of Panama in 2010 remained the main destination of investment for residential projects with 70% of the total, this proportion is less than in 2009 and 2008 when it was 86%. According to the MEF, this is attributed to the decentralization of the activity, which happened to be more intense in luxury apartment buildings to homes outside the capital district and the rest of the country. (La Prensa)
Economy
Always a strong economy in Latin America, with low inflation (thanks to a currency pegged to the US dollar), a stable democracy and key geographical position, Panama is now the strongest growing economy in Latin America. Economic growth was 8.4% in 2006, continuing a strong five-year upward trend, and the International Monetary Fund (IMF) predicts Panama's economy is set to grow more than any other Latin American country this year. Panama has for some time now been in a privileged position, not just in Central America, but in the western hemisphere.
The Panama Canal, built at the start of the 20th century, turned this tiny tropical haven into a major shipping hub for the world's ocean trade. Tourism now stands as the country's top source of income, receiving more than 700,000 visitors annually to its pristine beaches, vibrant rain forests and cosmopolitan capital city. The influx of visitors has also brought with it a boom in construction of hotels, condominiums, resort complexes and other services such as restaurants and shops, are springing up all over this vibrant city. The Panama Canal has started construction on its $5.2 billion dollar upgrade and is promising to create up to 50,000 new jobs in the region, as well ensuring the Canal's competitiveness in world shipping for decades to come. In fact, analysts predict the expanded canal will directly account for doubling the country's gross domestic product (GDP) by 2025, and increase business investment in the Canal Zone by 40 per cent. New projects to further stimulate the economy include a free trade agreement with the United States, currently in negotiation, the recent announcement by Occidental of a $6 billion regional refinery, and 14 new thermal and hydroelectric plants as well the Cinta Costera along avenida Balboa that will extend the coast line adding 12 lanes of highway for the traffic that will change the face of Panama city. These factors and more, have given Panama a unique position in the Latin American world - as a leader of economic growth with a stable and thriving market for business and investment.
Economic Facts 2006 Population: 3.2 million
GDP: $25.29 billion - 8.4% growth from 2006 Inflation (CPI): 2.6% External Debt: $9.99 billion Economic Aid: $197 million Exports: $8 billion - Primarily bananas, shrimp, sugar, coffee, clothing Imports: $9.36 billion - Primarily capital goods, food, consumer goods, chemicals Panama's economy is largely service oriented, accounting for about 70% of the GDP and 50% of jobs. Inflation is low, as the national currency (the balboa) is pegged to the US dollar. The US is Panama's main trade partner, receiving 50% of Panama's merchandise exports, followed by the European Union. The main goods exports are agricultural products (81%), fuels and mining products, and manufactures. The main services exports are transportation and travel, largely related to the Canal, the Colon Free Zone, and the tourism industry. Panama ranked 47th in the world on the Index for Economic Freedom, and 10th in the Americas, scoring top marks for business freedom, fiscal freedom, freedom from government, financial freedom, investment freedom and monetary freedom.
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