Panama GDP expands 10% in first semeter

Panama’s gross domestic product (GDP) expanded by 10% in the first half of this year, compared to the same period in 2020, when the country’s economy was semi-paralyzed due to measures to curb the COVID-19 pandemic which ultimately resulted in a 17.9% collapse of the indicator that year.

The National Institute of Statistics and Census (INEC) reported January and June the GDP “reached a cumulative growth of 10.0%”, with a significant expansion of the indicator in the second quarter (40.4%) in contrast with the result of the first quarter (-8.5%).

In the second quarter, the Quarterly Gross Domestic Product (GDPT) reached $9,124.9 billion, an increase of $2,627.8 billion compared to the same quarter of 2020, specified the INEC, a body attached to the Comptroller General’s Office.

“For the second quarter of 2021, mitigation measures and the vaccination process have been allowing health authorities to reduce or eliminate the restrictions established to contain the pandemic, helping economic activities begin their recovery process”, explained the statistical entity.

It specified that the activities related to the domestic economy that had a positive performance in the second quarter were construction; transport and communication; trade; government services; health and real estate and business, among others, while financial services showed decreases.

The items related to the external economy that grew were “exploitation of mines and quarries, by boosting the economy with the production of copper concentrate by 493.3%; and the Panama Canal, with an increase in its toll revenues by 20 2%, mainly those related to the transit of Neopanamax vessels at 21.5% “.

Port operations also expanded as a result of the greater movement of TEU containers by 17% and re-exports from the Colon Free Zone by 62.4%, while exports of bananas, pineapple, and fish showed decreases. After the fall of 17.9% last year, international organizations and risk rating agencies have predicted that Panama’s GDP will grow between 8% and 12% this year.

Local analysts warn that growth will be a “rebound effect” driven by sectors such as mining and not by the reactivation of the domestic market, because the public and private investments necessary to lift the sector have not been made, for which they foresee that unemployment will continue at around 20% and informality at more 52%.

Sectors such as hotels and restaurants; the manufacturing industry; financial intermediation; agriculture, and real estate, business and rental activities continue to be hit hard.