Panama public debt nears $25 billion
The balance of public debt at the end of August was $24.721 billion, up by $1.667 billion from the previous year. In the last month, the debt grew by $334.8 million, reports the Finance Ministry.
The increase in the balance of the debt means that every year the Government has to reserve more funds to pay interest. In the first half of this year, interest and commissions amounted to $566.6 million
Most of the debt is contracted in dollars, but there is a yen issue of $500 million from 2011 Therefore, the price of the dollar and the yen affects the balance of the debt. In the month of August, the yen gained 0.7% in relation to the dollar.
Since the administration of Juan Carlos Varela began, the public debt has grown by $7,082 billion, from $17,639.5 billion in June 2014 to the current $24.721.5 billion.
The figure of the debt does not include the commitments acquired by the National Company de Autopistas (ENA), the Tocumen International Airport and the Empresa de Electric Transmission entities, which have contracted debts to pay different investment projects and have their own income.
Since Panama obtained an investment grade in 2010, it had more access to international financing. In addition, the government’s debt capacity is greater because the growth of the economy generates more income to make against the expenses associated with the debt.
The risk rating agencies, , consider that the country’s debt capacity is greater. The outlook for the rating of sovereign debt has improved. In the five years of Ricardo Martinelli’s administration, the debt grew $6.837 billion, going from $10.802 billion in June 2009 to $ 17.639 billion in June 2014.
Therefore, the current administration has already surpassed of its predecessor with 9 months to go.
The president of the College of Economists, Olmedo Estrada, said that for this year a deficit is expected in the budget that will have to be financed with debt, and the first half of 2019, so the debt “can easily go up a billion more dollars “.
