The IMF Projects 4.5% Growth for the Panamanian Economy in 2025
The report highlights that Panama continues to allocate nearly 5% of its GDP to public investment, even in a context of fiscal consolidation.
The International Monetary Fund (IMF) in its country report highlighted that the Panamanian economy will grow 4.5% in 2025, driven by a low and stable inflation environment. The financial organization details that despite the closure of the Cobre Panamá mine , the impact on economic activity was moderate, thanks to the dynamism of key sectors such as services, logistics, and the full recovery of the Panama Canal. It also supports the Panamanian government’s strategy of maintaining a responsible balance between fiscal discipline and social investment, considering it a solid foundation for generating employment and promoting sustainable growth.
The IMF positively assessed the recent reform to the Social and Fiscal Responsibility Law, which establishes clear deficit ceilings: 4% of GDP in 2025 and 2% in 2029. According to the organization, meeting these goals will reduce public debt to around 40% of GDP by 2040, thus strengthening market confidence and reducing the country’s financing costs. Furthermore, the report highlights that Panama continues to allocate nearly 5% of its GDP to public investment, even in a context of fiscal consolidation. These resources are channeled toward priority sectors such as education, health, drinking water, social infrastructure, and strategic projects, ensuring that fiscal responsibility does not translate into social cuts, but rather into more employment and a better quality of life for the population.
The recent pension system reform was also recognized as a key step toward correcting funding gaps and strengthening social protection. He also praised the efforts to modernize tax administration, review spending mandates, and implement transparency measures as essential foundations for more inclusive growth. Regarding the financial system, the IMF confirmed that Panama has a solid, liquid, and profitable banking sector, with solvency indicators above regulatory standards. The country’s commitment to international standards on the prevention of money laundering and terrorist financing contributes to maintaining Panama’s confidence and reputation as a regional financial center. While the report warns of global and regional risks, it also notes that disciplined implementation of reforms, along with a balance between fiscal policy and investment in human development, will strengthen investor and market confidence in the country’s future.
