Presidency of Panama
Secretary of Economic Affairs
GDP (current):
– PANAMA: $24.3 Billion (2009) / $26.0Billion (2010 estimation)
– LATIN AMERICA AND CARIB. COUNTRIES: $4,024.0 Billion (2009)
GDP (annual growth rate):
– PANAMA: 2.4% (2009) / 7.0% (2010 estimation) / 6.0% (2011 est.)
– LATIN AMERICA AND CARIB. COUNTRIES: -1.9% (2009) / 5.2% (2010 est.) / 3.8% (2011 est.)
Despite lower GDP growth in 2009, it was the second best in Latin America and the Caribbean region.
Main projects to support future GDP growth:
i. Pan Canal Expansion: $ 5.3 Billion investment (estimated)
ii. Metro: 1.5 Billion (estimated)
iii. Heavy infrastructure investment by the government.
Unemployment (open):
– PANAMA: 4.2% (2008), 5.2% (2009)
– LATIN AMERICA AND CARIB. COUNTRIES: 7.3% (2008), 8.2% (2009)
Despite a decrease in GDP growth from 10.7% in 2008 to 2.4% in 2009, unemployment increased less than 1.5%.
Inflation:
– PANAMA: 2.4% (2009) / 2.8% (Jan-Aug 2010)
– LATIN AMERICA AND CARIB. COUNTRIES: 5.9% (2009) / 6.1% (1ST half 2010)
Public sector debt:
– PANAMA: $11.1BILLION OR 43% OF GDP 2010 (E)
– LATIN AMERICA AND CARIB. COUNTRIES: $1,336 BILLION OR 33.2% OF GDP (2009)
External debt
– PANAMA: $10.1 BILLION OR 39.1% OF GDP 2010 (E)
– LATIN AMERICA AND CARIB. COUNTRIES: $426.5 BILLION OR 10.6% OF GDP (2009)
Imports (goods):
– PANAMA: $15.5 BILLION (2009) / $6.1 BILLION (2010 semester 1))
GROWTH: -14.3% (2009), -6.7% (Jan-Jul 2010)
MAIN IMPORTS: Oil derivatives, nondurable consumer goods and raw intermediate goods.
MAIN PARTNERS: USA (27.2%), Costa Rica (4.9%), México (4.6%)
– LATIN AMERICA AND CARIB. COUNTRIES: $642.1 BILLION (2009)
GROWTH: -24.7%
Imports (services):
– PANAMA: $2.2 BILLION (2009) /$1.2 BILLION (2010 semester 1)
– LATIN AMERICA AND CARIB. COUNTRIES: $134.2 BILLION (2009)
Exports (goods):
– PANAMA: $11.6 BILLION (2009) / $4 BILLION (2010 semester 1)
GROWTH: 8% (2009), -18% (2010 semester 1)
MAIN EXPORTS: Fish, banana, watermelons, pineapples, etc.
MAIN PARTNERS: USA (40%), Europe (32%), China (4%)
– LATIN AMERICA AND CARIB. COUNTRIES: $692.0 BILLION (2009)
GROWTH: -22%
MAIN PARTNERS: USA (75%), Europe (7%), China (1%)
Exports (services):
– PANAMA: $5.4 BILLION (2009) / $2.8 BILLION (2010 semester 1)
MAIN EXPORTS: Tourism, Panama Canal services.
– LATIN AMERICA AND CARIB. COUNTRIES: $104.0 BILLION (2009)
Foreign direct investment:
– PANAMA: $1.8 BILLION (2009) / $1.14 BILLION (2010 Semester 1)
– Growth: -26.2% (2009) / 56% (2010 Q1)
Industry
Competitiveness rank (world economic forum):
– Position #53 (2010) #59 (2009), #58 (2008). 134 countries.
We are working on improving Panama’s economic position
Panama canal:
– Transit of ships: 14,412 (2009) or -2.0 growth
– Income from operations: $1.5 Billion (2009) or 7.9% growth
Tourism:
– 3.5 Million passengers (2009)
– Annual Growth: 10.5%
– Spending by visitors: $1.5 Billion (2009) or 5.3 % growth
Raising Our Investment Grade
– Fitch’s rating: improved from BB+ / positive perspective to BBB-/ positive perspective
– Moody’s rating: improved from Ba1 to Baa3 / stable outlook
– S&P rating: improved from BBB- to BB+ / outlook stable
Strategies to Attract International Investment
Special Regimes to establish regional headquarters by Multinational Corps. (Law 41 of 2007)
– More information at: https://sem.mici.gob.pa/
Tax incentives:
– Tax exemption on income, social insurance and educational insurance, when their salaries come from abroad (parent company).
– Import Tariff Exemption for household goods when a worker moves for the first time to Panama.
Immigration benefits:
– Permanent Personnel – 5 years visa (Renewable)
– Temporal Personnel –3 months visa (Renewable)
One stop shops:
– The Ministry of Commerce manages three one stop offices to facilitate international trade, foreign investment and starting a business.
Relevant Projects
Panama Pacifico Special Economic Area:
– designed to encourage free flow and movement of goods, services and funds
– attract and promote investments
– generate jobs and
– make the Republic of Panama more competitive
City of Knowledge: Business, science and technological development park
– Fiscal benefits: Import tax exemptions, transfer tax exemptions (ITBMS), exemptions on money transfers abroad,
– Special visas to foreign personnel
– Affiliated companies with no limits to hire foreign staff.
Population
– Total today: 3.5 Million (1.8 MM men, 1.7 MM women; 1.8 MM in Province of Panama)
– Annual growth rate: 1.6%
Social
Human development index rank:
– Rank 60 of 182 countries (2009) à High Human Develop.
– Source: United Nations Development Programme.
Education
Literacy rate:
– 95% (General Lifestyle Survey, 2008. Contraloría General de la República)
Public spending on education and culture:
– 4.6% of GDP (Contraloría General de la República, 2009)
Health
Life expectancy:
– 76 years; 4th highest in Latin America (World Health Organization, year 2008)
Quality of Life
Poverty rate:
– 33% (General Lifestyle Survey, 2008. Contraloría General de la República)
Income inequality:
– GINI of 55; zero= perfect equality; 100=perfect inequality (UNDP Human Development Report 2009)
Environment use efficiency:
– rank 18 out of 143 countries (Happy Life Index 2009)
Environmental public health:
– rank 24 out of 163 countries (Yale Environmental Performance Index, 2010)
Homicides per 100,000:
– 12.4 vs. 24.4 average in Central America (United Nations Office of Drugs and Crime, 2005)
Political environment
Political and press freedom:
– 1.5 (1= most free; 7= least free) (Freedom House)
Some useful links
Contraloría General de la República (General Comptroller’s Office):
Main reference for most economic data produced in the country. www.contraloria.gob.pa
Ministry of Economy and Finance:
Very good source for technical analysis and reports about the economic, financial and social environment in Panama. www.mef.gob.pa
Ministry of Commerce and Industry:
Provides relevant legal information relevant to firms operating in Panama. www.mici.gob.pa
Multinational Headquarter Companies site:
Provides specific information relevant to multinational companies headquartered in Panama. Benefits, requirements and permitted activities. www.sem.mici.gob.pa
One Stop Shops:
Website creation is still in process / To be confirmed by Vice Minister J. D. Arias
Panama Pacifico Special Economic Area Agency:
Information about business opportunities and legal requirements to set up business in the Panama Pacifico Special Economic Area. www.aaeepp.gob.pa/index_ingles.php
City of Knowledge:
General information about business and synergetic opportunities at this innovation center. https://www.ciudaddelsaber.org/en
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