Panama according to the CEPAL´s report “Preliminary Balance of the economies of Latin America and the Caribbean 2009” seems to have weathered the economic crisis fairly well and its GDP is expected to grow 4.5% in 2010. In terms of Latin America Brazil will lead the way with an estimated growth of 5.5%, followed by Peru and Uruguay with 5% and Bolivia, Chile and Panama with 4.5% and finally Argentina and Suriname with 4.0%.
The report by the BBVA (Banco Bilbao Viscaya Argentaria) called Situation Panama also comes up with the same percentage for growth in 2010: 4.5%. This projected growth is based on the actual execution of the major infrastructure projects announced by the current administration including the Canal Expansion, the Metro, the Cinta Costera, a new international airport and low income housing projects, among others.
Saying that Panama faced the crisis well does not mean it was not affected it just means that it was affected less than many other countries in Latin America. There are certain sectors in the economy that did not fare well at all such as agriculture which decrease 10% from 2008 levels, wholesale and retail with an 8% decrease and real estate with a decrease of 4.4%. The construction sector did not decrease but did not show any signs of growth in 2009 either. Many of the projects being built now already had financing in place since 2008 so they just carried on. On the other hand some sectors of the Panamanian economy did remarkably well such as transport, storage and communications which grew 8.2%. Currently this sector is the one with greater incidence on the GDP constituting 22.6% of the GDP. Another sector that showed solid growth during this tough year was the mining and quarry sector of the economy with 6.7% growth although it only constitutes 1.4% of GDP and is based mostly on the demand for construction material from quarries more than actual mining itself. The banking sector remained stable showing a 0.1% contraction due tdecrease in loan activity. Credit was greatly restricted.
For next year growth is expected to be between 2.5% to 5% while inflation is expected to be at around 2%. The sectors of the economy which should show the strongest growth are logistics, tourism, agriculture and financial services. Overall the projections for Panama in 2010 seem to be quite positive.
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