Moderators Moderator_03 Posted March 30, 2023 Moderators Share Posted March 30, 2023 Quote EXPOCOMER targeting 15,000 visitors Posted 29/03/2023 Panama’s Chamber of Commerce, Industries, and Agriculture (Cciap) anticipates receiving some 12,000 – 15,000 national and international visitors at Expocomer which was inaugurated at the Panama Convention Center on Tuesday and will run until Thursday, March 30. The event seeks to establish business contacts and commercial exchange for Latin America, the Caribbean, Europe, Asia, and Africa. More than 600 companies from 30 countries endeavor to strengthen their businesses and promote contacts between the countries of the region Expocomer will have 500 modules with an exhibition of products in the categories of food, beverages, and agricultural products; textile, clothing, and accessories; technology and electronics; medical equipment and supplies representing countries such as Argentina, Barbados, Bolivia, Brazil, Chile, Colombia, and Korea. CHINA’S PRESENCEChina resumes its participation as the largest pavilion -with 186 exhibition modules-, followed by Turkey with 40 and Taiwan with 21. The participation of more than 300 specialized buyers is expected for the business conference of the three events, and more than 15 trade missions from Canada, Chile, Brazil, Peru, Guatemala, Costa Rica, Colombia, Nicaragua, Ecuador, Puerto Rico, and Argentina. https://www.newsroompanama.com/news/expocomer-targeting-15000-visitors Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted April 27, 2023 Moderators Share Posted April 27, 2023 Quote Panama construction industry heading to pre-pandemic level Posted 19/04/2023 Panamanian Chamber of Construction (Capac) is confident that this year the sector will consolidate its recovery after the 51% drop in 2020 and will return to the numbers prior to the Covid pandemic. Carlos Allen, president of Capac, reports that the projection for 2023 is to exceed the $950 million in construction permits that were reported in 2019. "The recovery is slow, but it is happening," Allen commented, adding that it is important that the tranche of preferential interests that expired at the end of 2022 be extended so as not to interrupt the rhythm the sector brings. Currently, the National Assembly is discussing the extent of preferential interests, especially those of a social nature. On November 17, 2021, President Cortizo sanctioned the law that modified Law 3 of 1985, which establishes the preferential interest regime in mortgage loans for new low-income housing. https://www.newsroompanama.com/business/panama-construction-industry-heading-to-pre-pandemic-level Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted April 27, 2023 Moderators Share Posted April 27, 2023 Quote Panama tourism rebounds with January surge Posted 20/04/2023 Panama received 284,000 visitors, in January an increase of 104% in comparison with the same month of 2022 and 7% higher than that reported in January 2019, pre-pandemic. The Tourism Authority (ATP) report indicates that hotel occupancy in January reached 56% while spending by visitors grew 43% compared to the $499 million reported in the same month of 2019. Together with the construction sector, tourism was one of the most affected by the mobility restrictions applied by the Government to combat the coronavirus. In 2020 alone, the losses are estimated at $4.3 billion, a figure that rose to $12 billion for Latin America and the Caribbean, taking into account the development of the industry. between 2020 and 2023. Last year, the entry of one million 945 thousand visitors was registered, exceeding the estimate of the authorities that pointed to a movement of 1.8 million people. In total, last year tourist spending reached $4.7 billion, a figure similar to that reported before the respiratory pandemic. Regarding hotel occupancy in 2022, the numbers speak of 53%, an estimate made based on 26,000 hotel rooms available. It is estimated that there are still close to 4,000 hotel rooms that remain closed For this year, the authorities point to a movement between 2.2 million and 2.3 million visitors, a figure that would be close to the 2.4 million visitors reported in 2019. https://www.newsroompanama.com/business/panama-tourism-rebounds-with-january-surge Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted June 15, 2023 Moderators Share Posted June 15, 2023 Quote Slowdown in container movement hits Panamanian ports Posted 14/06/2023 The movement of TEU containers in the national port system fell 1.3% during the first four months of 2023, compared to last year. External factors, such as the loss of appetite for trade, are affecting activity. Cargo movement in metric tons decreased 2.2% The Russia-Ukraine war, , inflation, and the loss of value of currencies against the US dollar are external factors that are affecting the movement of containers in the national port system reports La Estrella. From January to April 2023, the movement of TEU containers in the national port system fell 1.3%, compared to the same period in 2022, according to preliminary indicators from the Panama Maritime Authority (AMP). During the first quarter of 2023, the total volume of activity reached 2,647,686 TEU containers, compared to 2,681,578 in 2022, which is equivalent to 33,892 fewer movements so far this year. In Bocas Fruit Co. the movement of containers fell -16.1%; for its part, Colón Container Terminal increased by 7.1%; in Manzanillo International Terminal it fell by 4.5%; in Panama Ports Company - Balboa decreased by 1.2%; in Panama Ports Company - Cristóbal it increased 3.8%, and in PSA Panama International Terminal it fell -5.4 %. As of April 2021, activity stood at 28.3%.“At a global level there is a marked slowdown in the movement of cargo. Many of us are buying less than last year, which is a representation of the global consumer. If you buy less, the stores that sell buy less; And if they buy less, they order less, and we see fewer containers. That is the variable”, commented the Vice President of Marketing and Corporate Affairs of Manzanillo International Terminal, Juan Carlos Croston. He said that, in Colombia, citizens are suffering from the devaluation of the Colombian peso against the US dollar. “Colombians are suffering because their local currency reached almost 5,000 pesos to the dollar and that increases their cost of living, Croston said. He highlighted that in Manzanillo, for example, last year they finished 3% below 2021. https://www.newsroompanama.com/business/slowdown-in-container-movement-hits-panamanian-ports Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted June 19, 2023 Moderators Share Posted June 19, 2023 Quote Housing, water, gas and electricity increase 10.9% Posted 19/06/2023 The cost of housing, water, electricity, and gas services increased by 10.9% in one year (May 2022 versus May 2023) according to the report of the Consumer Price Index (CPI). The report details that the CPI for electricity skyrocketed 41.4% in one year, impacted by the elimination of subsidies that were given to some customers based on consumption due to the pandemic. The seasonal increase in the service that is recorded each semester due to the increase in energy costs also had an impact. In the case of housing, the prices affected by the rise were housing repair and maintenance services, which increased by 11.7% in one year. FOOD PRICES Between May 2022 and May 2023, the CPI for food and non-alcoholic beverages also accelerated by 4.2%. The food products that increased in price the most in one year were pasta at 10.8%, followed by creams and flour at 9.1%, and bread and other bakery products at 3.8% interannual variation. Meat prices on average rose 2.7% in one year, driven by the 11.9% increase in products such as canned beef and pork, in addition to sausages by 8.4%. In the case of the milk, cheese, and eggs group, the CPI accelerated 6.4% and the greatest increases were in products such as cheese at 9.1% and eggs at 6.1%. In May, the price of the Basic Family Food Basket measured by the Consumer Protection Authority (Acodeco) registered an average of $289.56 an increase of 3.15% compared to May 2022. https://www.newsroompanama.com/news/housing-water-gas-and-electricity-increase-109 Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted June 25, 2023 Moderators Share Posted June 25, 2023 Quote Panama a step closer to exiting FATF gray list Posted 24/06/2023 The Financial Action Task Force certified Friday, that Panama has substantially completed the action plan agreed in 2019 to address the deficiencies detected in the money laundering prevention regime, which means that the country is close to exiting the gray list of the international organization. The announcement came at the end of the FATF's second plenary of the year, held in Paris, France. Responding to a question from La Prensa in a hybrid press conference, the president of the FATF, Raja Kumar, highlighted the progress made by Panama, noting the change in tone compared to the last conferences, in which the FATF representatives had urged to complete the action plan and even warned about the possibility of including the country on the blacklist. Kumar pointed out that the country has shown to have a robust system to maintain adequate and updated information on the final beneficiaries of the companies, as well as timely access to information by competent authorities. These recommendations were pending until d a favorable rating with the implementation and upload of information from the registry of beneficial owners. In a statement published Friday, the organization referred to other measures adopted by Panama in recent years, such as reinforcing national and sectoral understanding of the risks of money laundering and terrorist financing and taking steps to identify unlicensed money remitters, using a risk-based approach to monitor the non-financial business sector and apply effective, proportionate, and dissuasive sanctions against money laundering violations; make use of the information from the Financial Analysis Unit for money laundering investigations, demonstrate the ability to investigate and prosecute money laundering linked to foreign tax crimes, as well as provide timely and constructive international cooperation. ON-SITE VISIT Once the action plan is completed, the next step will be an on-site visit to the country by FATF experts in September to verify progress so far and that the measures taken are sustainable over time. The agency expects the country to show a high-level political commitment to continue strengthening money laundering prevention. Once the report from the team of experts has been received, deliberations will be made in the October 2023 plenary, and Panama's removal from the gray list could be made official. https://www.newsroompanama.com/news/panama-a-step-closer-to-exiting-fatf-gray-list Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted July 2, 2023 Moderators Share Posted July 2, 2023 Quote Panama credit card debt up 4.1% in May Posted 01/07/2023 The balance of credit cards issued by banks increased by 4.1% in May compared to the same month of 2022, to a total of $2,486 million according to the Credit Reference System (SRC). The record also reflects that the number of active and in-use bank cards increased, going from 656,219 to 706,572, that is, 7.7% more than a year ago. To this must be added the 169,788 cards issued by other institutions such as cooperatives, financial institutions, businesses, and other companies. In this category, the balance of credit cards as of May was $399.9 million, 32.9% more than a year ago, reflecting a 21.3% increase in the number of obligations. According to APC reports, the average balance of credit cards issued by banks is $3,520 per customer. It is estimated that 14.5% of the total balance of credit cards is past due for more than 61 days, which is equivalent to 7.1% of commitments. The average balance of credit cards issued by cooperatives, businesses, and financial institutions amounts to $2,355 per person and it is estimated that 66.40% of the total balance reports more than 61 days of delinquency, equivalent to 24.5% of the clients of these cards. The credit reference system contains information on 1,808,226 Panamanians and 286,961 foreigners residing in Panama, for a total of 2,095,187 people is calculated that the per capita debt considering the number of debtors is $18,314 per person. https://www.newsroompanama.com/news/panama-credit-card-debt-up-41-in-may Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted July 3, 2023 Moderators Share Posted July 3, 2023 Quote Panama heads region in economic growth and one of world’s lowest inflation rates Posted 03/07/2023 The head of the Ministry of Economy and Finance (MEF), Héctor Alexander, highlighted Saturday, July 1, that in the region, Panama leads economic growth, while maintaining lower inflation. "We have low inflation and, above all, what has been done in terms of public finances allows us to continue with investment grade, being one of the few countries in the region that have it and one with the lowest level of risk, which benefits not only to the government and its transactions but also to the operations that are carried out in Panama”, Alexander highlighted upon arriving for the installation of the National Assembly. “The Panamanian economy has been growing very well, since in 2021 it did so at 15.8%, in 2022, 10.8% and this year, in the first months, 9%, and it is estimated that at the end of the year, it will be 5%. ”, Alexander detailed to the media on the outskirts of the chamber. He added that Panama's economic growth continues to lead the region, and along with that it can be said that the country also leads one of the lowest inflation rates, not only in Latin America but in the world; and in terms of unemployment "we are going in a good direction due to the way in which unemployment has been reduced", noting that the latest figures he manages indicate that in April 2022 there is an increase of 13% in job creation, of which 92% are formal jobs https://www.newsroompanama.com/news/panama-heads-region-in-economic-growth-and-one-of-worlds-lowest-inflation-rates Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted July 12, 2023 Moderators Share Posted July 12, 2023 Quote Panama seeks to boost Direct Foreign Investment Posted 10/07/2023 Diversifying the economy, promoting innovation, and increasing its competitiveness is part of the benefits obtained by a country that manages to attract significant flows of Foreign Direct Investment (FDI), says Adolfo Fabrega president of Panama’s Chamber of Commerce, Industries, and Agriculture (Cciap). "For a developing country like Panama, FDI is crucial to boost economic growth," says the businessman, who maintains that foreign companies that invest in Panama benefit from a welcoming and dynamic business environment. Fábrega's words are in line with those expressed by Tomás Bermúdez, the new representative of the Inter-American Development Bank (IDB) in Panama, who said that it is crucial that the country diversify its economy so as not to depend on a few sectors, and, instead, have multiple engines that allow us to continue advancing reports La Prensa. “From the Bank's point of view, Panama's challenges are, on the one hand, the formation of human capital and closing territorial gaps. Secondly, it is a priority to increase the country's competitiveness and product diversification. Although we are saying that some of the important sectors such as construction have fallen, new engines of growth must be sought and tourism and agriculture clearly appear there,” Bermúdez commented. The United Nations Conference on Trade and Development (Unctad) indicates that FDI worldwide decreased by 12% in 2022, while in Latin America it grew 51% to $208 billion with Brazil and Mexico being the main destinations for capital invested abroad last year. FDI in Panama contracted 86% in 2020, being one of the few countries in the region with red numbers during the pandemic, while in other nations the arrival of capital only slowed down. Although FDI flows have improved in the last two years, they are still below the $4.62 billion reported in 2019. https://www.newsroompanama.com/news/panama-seeks-to-boost-direct-foreign-investment Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted July 18, 2023 Moderators Share Posted July 18, 2023 Quote Mortgage loans in Panama increase on Aug.1 Posted 18/07/2023 On Tuesday, July,18 many bank customers woke up with an email announcing that the reference rate for mortgage loans will increase 0.08% from August 1. On June 29, 2023, the Panamanian banking regulatory body, the Superintendence of Banks of Panama (SBP), in A circular issued to the banks expressly states that "in accordance with article 4 of Law No. 3 of May 20, 1985, modified by Law No. 94 of September 20, 2019, which establishes a preferential interest on certain mortgage loans, we would like to inform you that the calculation of the reference rate for the third quarter of 2023 was 5.92%”."In accordance with the foregoing, the local market reference rate for residential mortgage loans, corresponding to the third quarter of 2023, is 6.00%..". With this change, the loan rate increased 25 percentage points effective August 1. Internationally, interest rates are increasing and this is having an impact in Panama. With the arrival of the covid-19 pandemic, the economy was practically paralyzed. To partially keep it running, the governments of the different countries injected money so that their citizens will continue to make purchases. With this, they sought to stimulate the economy. But when the health crisis ended, an imbalance was generated. There was much more money in circulation than usual, and this put pressure on demand, increased prices, and led to exorbitant inflation. The United States, for example, surpassed 9% inflation in 2022. In the last four decades, the US economy had not experienced that level of price inflation. And when inflation rises, so do interest rates. The US government began withdrawing money from the economy seeking to lower prices. And when liquidity is withdrawn, interest rates become more expensive. https://www.newsroompanama.com/news/mortgage-loans-in-panama-increase-on-aug1 Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted July 21, 2023 Moderators Share Posted July 21, 2023 Quote US chooses Panama for “chips” collaboration Posted 20/07/2023 The United States government has chosen Panama as one of the few countries worldwide with which a collaboration will be established to strengthen the global value chain of semiconductors, commonly known as "chips" reports TVN. The Ministry of the Presidency indicated that within this newly formed association, the US and Panama will collaborate closely to carry out an in-depth evaluation of the existing semiconductor ecosystem in the country, with the objective of identifying Panama's strengths and areas of improvement within the sector, providing valuable ideas for future collaborations in the development of this critical industry. The review will be funded by the International Fund for Technological Security and Innovation (“ITSI Fund”). The fund is administered by the US Department of State for the purpose of supporting and fostering collaboration with countries it has deemed critical to the semiconductor industry. Panama recognizes the importance of semiconductor technology as a cornerstone of economic growth, national security and technological innovation. It plays a key role in various industries, including telecommunications, automotive, healthcare and consumer electronics. The Government of Panama has entered into discussions with Arizona State University, the leading innovation institution and renowned player in the semiconductor industry. Semiconductors are especially useful in the electronics industry, since they allow conducting and modulating electrical current according to the necessary patterns. For this reason, it is usual that they are used Semiconductors are used in almost all sectors of electronics. Mobile phones, laptops, game consoles, microwaves, and refrigerators are powered by the use of semiconductor components such as integrated chips, diodes, and transistors. https://www.newsroompanama.com/news/us-chooses-panama-for-chips-collaboration Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted July 24, 2023 Moderators Share Posted July 24, 2023 Quote Business leaders welcome US-Panama chips deal Posted 23/07/2023 “The collaboration with the United States and the support of the International Fund for Security and Technological Innovation will be an important incentive for the arrival of greater investments from companies from that country to Panama. Technology companies and semiconductor manufacturers will have an attractive platform in Panama to establish operations and take advantage of our strategic position in the region”, says Panama’s Chamber of Commerce Industry And Agriculture (Cciaf) The business union highlights that the semiconductor industry is highly intensive in skilled labor. "Its development in Panama will mean the generation of specialized jobs in areas such as design, engineering, manufacturing and management, which will boost employment, the development of local talent and exports from our country", they highlight. The businessmen point out that the continuous growth of technology as an economic activity has been recognized by both nations, and Panama, aware of the importance of taking advantage of this wave of opportunities, the Chamber has included an outstanding priority in the Country Agenda Project: Education and job creation. The Chamber of Commerce indicates that the National Government and society as a whole should focus on seriously promoting education in science, technology, engineering and mathematics (STEM). They specify that although the educational challenges do not disappear with this announcement, the momentum of this semiconductor industry promises to be the necessary stimulus to address and solve the pending challenges in the educational system. https://www.newsroompanama.com/news/business-leaders-welcome-us-panama-chips-deal Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted August 16, 2023 Moderators Share Posted August 16, 2023 Rating agency reaffirms Panama’s investment grade Posted 11/08/2023 The credit rating agency Standard & Poor's (S&P) improved the outlook to stable and has reaffirmed Panama's investment grade at BBB (adequate capacity to meet its financial obligations, but more subject to adverse economic conditions). According to S&P, the rating is based on solid economic performance and economic diversification, as well as leading GDP growth among nations of similar development. They highlighted that the improvement in the outlook reflects the confidence of the rating agency that the current economic situation will continue consistently during the next two years, providing solid support for favorable economic growth. The rating agency expressed its expectation that the future administration maintains prudent fiscal management and solid macroeconomic policies, factors that will contribute to keeping fiscal deficit levels at low levels. Growth They also projected average GDP growth of 5% in the coming years, supported by investor confidence and a robust pipeline of investment projects from both the public and private sectors. Finally, they recognized that economic growth exceeded expectations, highlighting the solidity of its economic base. During 2021, GDP registered a growth of 15.8%, followed by 10.8% in 2022. https://www.newsroompanama.com/business/rating-agency-reaffirms-panamas-investment-grade Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted September 28, 2023 Moderators Share Posted September 28, 2023 Quote Panama issues $1 billion in debt bonds Hector Alexander Posted 27/09/2023 The Panama Government issued another billion in debt bonds, a transaction approved by the Cabinet and published Wednesday, September 27, in the Official Gazette. The funds will be used to “strengthen” this year's budget. Also included is a reopening of bonds, in which, depending on the behavior of the market, the government hopes to raise another $200 to $300 million, according to the Minister of Economy and Finance, Héctor Alexander. The series of issues will be made with a fixed coupon, their maturity will not be less than 10 years and they may be issued in dematerialized form or by macro-titles, according to the technical information of decree number 31 that authorized the issuance by Cabinet. The bonds were registered with the Securities & Exchange Commission (SEC) of the United States, with the Bank Of New York Mellon as the fiscal agent for payment, registration, and transfer. The decree also authorizes the MEF to negotiate derivative instruments to “optimize the cost/risk balance of the public debt portfolio,” leaving the ministers and vice ministers of that portfolio the power to negotiate and coordinate the final terms of the contracts, bonds, issues, subscriptions and the hiring of intermediaries for payment, repurchase and transfers that emanate from said issues. Alexander said that he met with the banks to organize the issue, which also contemplates the reopening of bonds. He reaffirmed that the issuance is part of the strategy to secure funds for the cash flow required for the operation and financing of public investments. Strategically, the minister confirmed that they have also done pre-funding to take the temperature of the market in order to improve liability management. https://www.newsroompanama.com/news/panama-issues-1-billion-in-debt-bonds Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted October 2, 2023 Moderators Share Posted October 2, 2023 Quote Functioning judicial system outweighs high GDP – business leaders Posted 01/10/2023 The functioning of a judicial system and respect for the law constitute the main indicator of the health of a society, overriding a high GDP or foreign investments said Panama’s Chamber of Commerce, Industry and Agriculture (Cciap)on Sunday, October 1. “Recent high-profile cases in our country have highlighted the need to continue working to improve our system of administration of justice and strengthen the rule of law,” the union indicated. For the Cciap, it is “worrying” that Panama continues to face a vulnerable justice system, which often grants impunity to those who systematically challenge it. “Unfortunately, over the years, we have witnessed how the blatant theft of state resources goes unpunished due to our weakened institutions,” the Chamber said. For the country, the situation “is not a minor problem, since this “criminal behavior and constant disregard for the law have consequences that go far beyond the courts, affecting the quality of life of an entire population, the country's infrastructure and the quality of public services.” “Without reliable and expeditious justice, social and economic stability becomes unattainable,” it added. This week the Cciap will hold the forum of the Country Agenda Project 2024 – 2029, focused on a transparent, efficient, and participatory institutional framework, in which they will highlight the importance of the balance of public powers, the promotion of trust and stability, impartial justice, clear rules for all actors and constant legal security. They also plan to review specific proposals, such as the "imminent departure " of the country from the Central American Parliament (Parlacen), a regional organization that "does not prove to provide real contributions to the future of Panama and on the contrary has become a shell of impunity after the which politicians and figures involved in high-profile cases hide behind.” https://www.newsroompanama.com/news/functioning-judicial-system-outweighs-high-gdp-business-leaders Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted October 6, 2023 Moderators Share Posted October 6, 2023 Quote Business chamber asks Finance Minister to explain Fitch downgrading Posted 05/10/2023 Panama’s Chamber of Commerce, Industries and Agriculture (Cciap) asked the Minister of Economy and Finance, Héctor Alexander, on Thursday, to provide the country with a clear and realistic explanation about the change in outlook from stable to negative by the credit rating agency. Fitch Ratings. The business union also asked Alexander for an action plan that reflects strong financial policies to reverse the current situation. “This change from perspective to negative is a direct product of growing indebtedness to cover a large payroll and the financial reality of decreasing income that does not cover expenses,” said Adolfo Fábrega, president of the Cciap in a statement distributed Thursday. Fábrega indicated that added to the payroll there is a high budget for the next period that clearly reflects electoral purposes. “The current administration has the duty to redirect its financial actions in the months ahead,” said the business leader. The statement recalled that the rating agency's report questions the fiscal deficit and the “accounting maneuvers” to reduce it in the last year. “In a country where there is a balance of powers, the National Assembly would have already summoned the Minister of Economy and Finance to explain the case, since it is owed to the citizens. Something so delicate cannot go unnoticed. We hope that the Legislative Body acts accordingly,” Fábrega said. According to Fábrega, from "the outside they send us a message to put the house in order, and from this union we reiterate our rejection of any contracting of debt intended for operating expenses." https://www.newsroompanama.com/news/business-chamber-asks-finance-minister-to-explain-fitch-downgrading Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted November 9, 2023 Moderators Share Posted November 9, 2023 Quote Ratings agency gives Panama a negative outlook Posted 08/11/2023 The risk rating agency Standard & Poor's (S&P) maintained the risk rating for Panama at BBB but revised the outlook from stable to negative. The negative outlook, according to the rating agency, reflects the risk of potential damage to investor confidence and future private investments, as a result of the rejection of the contract between the Panamanian State and Minera Panamá. The strong opposition to the mining contract has generated uncertainty about the fate of the project, whose future is now in the hands of the Supreme Court, where there are up to eight unconstitutionality lawsuits against Law 406 of 2023, which adopted the contract with Minera Panamá. It has also led to a recent moratorium on new metal mining projects. This development could weaken private investment and hamper the country's long-term growth prospects, a situation that would lead Panama to a rating downgrade in the next 12 months, S&P said. However, this is not the only factor that intervenes in the rating agency's perspective. In fact, it adds to other elements that also generate uncertainty. S&P's forecasts incorporate the impact on government revenues due to the possible cancellation of the contract with Minera Panamá, as well as possible shortfalls in dividends from the Panama Canal Authority (ACP), due to the impact of the drought on revenues. On the other hand, the enormous crisis of the exclusively defined benefit Disability, Old Age, and Death (IVM) subsystem of the Social Security Fund (CSS) is unresolved. “The risk of potentially lower economic growth could exacerbate the deterioration of the finances of the Social Security Fund of Panama. The reserves (from the exclusively defined benefit program) will be exhausted in 2025″, according to Government calculations, resulting in increasing government transfers over time of tax reform. Panama's institutional profile incorporates the consolidation of democracy. That is, they expect the country's main political parties to share a consensus on key economic policies. “We expect broad policy continuity after the national elections in May next year when current President Laurentino Cortizo ends his five-year term.” https://www.newsroompanama.com/news/ratings-agency-gives-panama-a-negative-outlook Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted November 30, 2023 Moderators Share Posted November 30, 2023 Quote JP Morgan throws cold water on Panama celebrations Posted 29/11/2023 While Panama celebrated the Supreme Court ruling that annulled the concession contract to First Quantum Minerals (FQM) in Panama, the investment bank JP Morgan warned about the economic difficulties that the country could face. “Panama could be subject to a profound and negative impact on its medium-term growth prospects and, by extension, on fiscal ones. "While there is much uncertainty ahead, possibly lingering until the May election, it seems safe to say that some damage has already been done," the company wrote in an analysis to investors. For more than a month, environmental groups, activists, young people in defense of the environment, and citizens in general have led the largest protests in the country in decades against the Government's contract with the mine approved by the National Assembly. Worker groups such as the Construction Workers Union (Suntracs) and the teachers' union, Asoprof, have also blocked streets in the capital and the main highways throughout the country to demand the closure of FQM. JP Morgan highlights that these demonstrations have already had a substantial economic impact on the country's finances, causing large losses in the tourism and hospitality sectors, among others and it warns that this could only be the beginning. “We expect gross domestic product (GDP) to contract this quarter and enter 2024 facing an uphill battle,” the firm wrote, adding that its concerns go “beyond a year of poor growth.” “Our main concerns are that the country could suffer a continued decline in its growth in the medium term and an erosion of its public finances.” JP Morgan highlights that the copper mine represents approximately 4% of the country's GDP and its closure will have a substantial impact on government revenue and the GDP will contract. Although they foresee a growth of 3.5% year-on-year, they indicate that the debt/GDP ratio would be on a marked upward trend. In addition, the firm hopes that the decision will have an impact on foreign direct investment, as external investors question whether the country is a safe place to invest: “We believe that the damage has already been partly inflicted, as investors “They will probably question the country's institutional framework, which will affect investment, which is an important component of growth.” In any case, the perspectives presented by JP Morgan may be somewhat more optimistic than the real situation. Many of the company's assumptions appear based on the assumption that the Government and FQM could reach an agreement that would allow the mine to continue operating. “We continue to believe that the most likely outcome is for the two parties to return to the negotiating table and seek a mutually viable solution. It is also worth noting that if the contract is not renewed, FQM will most likely resort to international arbitration, where the country could be held liable for billions of dollars,” they wrote. If that does not happen, that is, if the contract is not renewed, JP Morgan predicts that FQM will appeal to international arbitration, where the country “could be held responsible for billions of dollars (8 or 9).” However, it recognizes that this will depend on whether the annulment of the contract “was entered into with the appropriate legal basis and in favor of the public interest or not, according to Article VIII of the International Treaty to Promote and Protect Investments between Panama and Canada.” But, the company failed to take into account that the government recently approved a moratorium on all mining concessions, meaning negotiating with FQM may not be a viable option under Panamanian law. In the scenario of permanent closure of the mine, JP Morgan predicts a rapid economic impact, as it projects that Panama will suffer a downgrade of the agencies' credit rating. This, in turn, will make it more expensive for the country to borrow money and finance its current fiscal deficit. https://www.newsroompanama.com/news/jp-morgan-throws-cold-water-on-panama-celebrations Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted December 1, 2023 Moderators Share Posted December 1, 2023 Quote Panama bonds fall on fears of losing investment grade Posted 30/11/2023 Panama's dollar bonds maturing in 2036 fell on Tuesday from 8 cents to 95.1 cents on the dollar, according to the price published by the financial portal Bloomberg. These are the first effects of the departure from Panama of Minera Panamá, a subsidiary of First Quantum Ltd, whose operation represents more than 1% of world copper production. Still, for Panama, it meant an income of 4% of gross domestic product. “Panama's dependence on international capital markets could be a self-reinforcing loop and could raise existential doubts about Panama's financing model in the future,” Bloomberg reports in a note published on Wednesday by Barclays. According to Bloomberg, the firm recommended its clients sell sovereign bonds maturing in 2028 and 2030.“The expectations are that the country will have problems financing the external debt due to the lack of income,” considers economist Rolando Gordon. The professor at the University of Panama explained that given the uncertainty that the bonds may continue to fall, they prefer to sell them, even if they lose a percentage compared to the initial price, due to the fear that Panama could lose the investment grade. https://www.newsroompanama.com/news/panama-bonds-fall-on-fears-of-losing-investment-grade Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted December 3, 2023 Moderators Share Posted December 3, 2023 Quote Panama’s GDP up 8.8% in the first half of the year Posted 02/12/2023 Panama’s gross domestic product increased by 8.8% in the first half of the year compared to the same period last year. According to the Comptroller's Office, the first quarter registered greater dynamism, increasing by 9.3% compared to the same period last year, while in the second quarter (from April to June) the growth was 8.2%, which together gives 8.8% for the first half of the year. Between April and June, construction, permits, wholesale and retail trade, manufacturing, electricity and water, restaurants, and land transportation performed better in economic activity, with increases in Metro and MiBus passengers of 15.7%. and 6.1%, respectively. In contrast, the activities that decreased in proportion in those months included health services, the generation of hydraulic energy by 37.9%, and the slaughter of cattle, which decreased by 2.8%. Activities such as air transportation also increased, as did the Panama Canal tolls, which contributed 15% more. Banana exports also rose by 33.3%, fish by 30.6%, and to a lesser extent - but also on the rise - were port activities. Exports of copper concentrate registered a decrease with a volume of 90,086 tons produced, a lower amount than the same period of the previous year, and shrimp exports decreased by 16.9%. Mining protests This growth is expected to slow down at the end of the year because of the massive protests against the mining contract, whose closures caused damage to different economic sectors such as tourism, agriculture, and commerce in general. The World Bank predicts that the year will close with growth of around 6.3% for Panama. The International Monetary Fund updated its projection from 5% to 6% two months ago, also in context before the crisis due to the mining contract. The eventual update to more realistic terms that include the effects of recent events on the growth projection will also be central to the amount of the State's general budget for next year, whose figure is not yet known, with less than a month to go to close the fiscal year. https://www.newsroompanama.com/news/panamas-gdp-up-88-in-the-first-half-of-the-year Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted December 8, 2023 Moderators Share Posted December 8, 2023 Quote Panama risks losing investment grade Posted 07/12/2023 Panama faces several economic scenarios that worry the financial system such as a possible loss of investment grade due to fear that it will not be able to manage the fiscal deficit, address public spending, and manage the issue of the actuarial deficit in the Social Security Fund, mainly with the Disability, Old Age and Death (IVM) program. In addition, the resources provided for mining exploration and exploitation will not be available as the contract between the State and Minera Panamá is declared unconstitutional if analyzed from a strictly economic point of view. These scenarios are considered by the Superintendency of Banks of Panama in a report published this week titled 'Analysis of macrofinancial Threats for the National Banking System ', in which it warns about the risks that the country and the banking industry have. Specifically, the banking regulator states that the effects of the possible loss of investment grade would change the entire panorama, bringing consequences to the banking system, such as reduction of the domestic portfolio, increase in delinquencies, greater provisions, losses in the income statement, effects on the solvency of banks. “If there is a downgrade of the sovereign rating, as a result of the deterioration of economic and social indicators, our country could suffer the impact of the increase in the cost of funds that would be received from abroad, as well as a reduction in direct external investment,” warns the Superintendency. The regulator explains that the consequences are a kind of escalation that begins by affecting the cost of financing for the Government, but also for banks and companies, as well as the impact on investments. “External financing would not only become more expensive but could also be reduced since, being more expensive, smaller amounts would be requested. By decreasing the amount of financing that would be received, government investments would be reduced. This, on the one hand, would impact unemployment and, on the other, the money that would circulate in the economy,” he says about the cascading effect in a possible loss of the country's investment grade. The regulator indicated that the revocation of the mining contract “could deteriorate the perception of Panama as a favorable destination for business, increasing the risk that the country loses its investment grade rating in the short term.” Impact of mine closure The banking regulator also analyzed the impact on banking and the economy of the closure of the mine operations. The Superintendency specifies that considering that Minera Panamá contributes $4,683 million annually to the country's Gross Domestic Product (GDP), 4.8% of the total, while the multiplier effect on income (remunerations) is estimated at $447 million, that is, 2.6% of the national total. By not having these resources, the effect on the economy will be a fall. “Without a doubt, the repercussions, resulting from the possible fall in GDP, reduction in tax revenue, deterioration of finances, would have consequences that could lead to the loss of investment grade,” warns the regulator. It indicates that in addition, the jobs associated (direct, indirect, and induced) with the mining operation are estimated at 40,793, which is equivalent to 2.3% of the country's total employment, which will also lead to fewer jobs and therefore many people will even have problems. to meet their financial commitments and delinquencies will rise. According to the banking regulator, there are 3,094 clients of the financial system who work at Minera Panama and maintain loans in various banks for mortgages and consumption for 146 million dollars. In detail, these employees owe an average of 89.7 million in mortgage loans, 047% of the total loans in the system; 17.69 million dollars in auto loans, 29.58 million in personal consumption, and 8.60 million dollars in credit card debt. The regulator reveals that 26 banks have lent money to this group of clients and 6 banks classified as large, taking into account the size of their assets, concentrate 72% of the weight of the mining portfolio with 104 million dollars, which would represent within of total personal consumption and mortgage around 0.44%. The Superintendency indicates that the financial system could absorb these risks, although the situation regarding the country's economy is still worrying. “The level of exposure, both of consumer banking debtors, and the projected exposure of suppliers, are not financing levels that could cause a collapse, as a result of short-term defaults,” indicates the regulator. https://www.newsroompanama.com/news/panama-risks-losing-investment-grade Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted December 11, 2023 Moderators Share Posted December 11, 2023 Quote Business Chamber demands re-engineering of ‘incoherent’ State budget News Posted 10/12/2023 The president of Panama’s Chamber of Commerce, Industries, and Agriculture (Cciap), Adolfo Fábrega, demanded on Sunday, December 10, that the Executive Body, headed by President Laurentino Cortizo, present to the country the concrete way in which it will adjust the General State Budget of 2024. Fábrega stated that the bill that had been presented with the budget “reflected an unjustified, suspicious, and incoherent increase of 20% with respect to 2023.” Furthermore, the budget bill originally presented must undergo a total re-engineering through which the disproportionate and opaque amounts allocated from entities, such as the National Assembly, are sharply reduced. On the contrary, it is appropriate to prioritize budgets such as that of the National Cancer Institute, the Children's Hospital, and the Specialized Higher Technical Institute (ITSE), among others, which directly affect the quality of life of citizens. The leader recalled that Panamanians demonstrated that they are not willing to continue being a mere passive spectator and have categorically demanded from both current and future authorities serious, responsible, transparent, and honest management of State resources. “The opportunity is once again presented on a silver platter with the announced review of the General State Budget for Fiscal Year 2024,” Fábrega added. For the Chamber, the 2024 General State Budget must be structured in a way that significantly reduces operating expenses, generating current savings and allocating resources to public investment. Furthermore, it is necessary to significantly reduce the state payroll, eliminating as soon as possible unnecessary and duplicate positions in the public administration, which are only a vehicle for politicking and corruption. “The data show that, at a time when the country was demanding extreme austerity in the years 2020 to 2023, payroll spending reached the worrying accumulated figure of $15,341 million,” Fábrega emphasized. The 2024 General State Budget must focus on a responsible and efficient fiscal policy that encourages the reduction of operating expenses and prioritizes public investment, he reiterated. https://www.newsroompanama.com/news/business-chamber-demands-re-engineering-of-incoherent-state-budget Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted December 13, 2023 Moderators Share Posted December 13, 2023 Quote Mining protests fallout could shrink GDP 1.6% News Posted 11/12/2023 Panama’s Gross Domestic Product (GDP) could close the year, with a reduction in its growth between 1.2% and 1.6%, as a consequence of protests and street closures, against the mining contract that lasted more than 30 days. The estimates have emerged as part of what was indicated by private sector unions, who estimated daily losses of $90 million, that is, more than $2 billion in activities such as tourism, transportation, agriculture, and logistics between October and last November. The economist Even Chi Prado, who is also a market behavior analyst and financier, predicted a possible reduction in GDP of 1.6% (almost $2 billion), according to the estimates of the Ministry of Economy and Finance (MEF). ) which until last September were 6%.Chi stated that Panama's Quarterly Gross Domestic Product (GDP) experienced a growth of 8.8%, and the GDP may end up at 5.5%.“The economic impact of the crisis will affect the closing of 2023, since if in the first semester it closed at 8.8%, with the economic impact, it can be estimated at 5.5%,” stressed the financier. Chi's estimate coincides with that of the dean of the Faculty of Economics of the University of Panama, Rolando Gordón since he estimates that the 2023 GDP will close in the order of 4% to 4.5% with a drop between 1.2% to 1.5%. “The protests that strongly affected production, especially national production, have resulted in GDP growth going from 6% or 6.5% to 4.2% or 4.5%, after a fall of 1.2%. % to 1.5%,” said Gordon. The figures, according to economists consulted, would change the growth prospects that the Government and international organizations had. Three months ago, the Minister of Economy and Finance, Héctor Alexander, announced that GDP growth this year would be at least 6%, higher than the 5% that had been previously forecast. While the World Bank predicted 6.3%, the International Monetary Fund 5.3% and Indesa 4.5%. The MEF estimates were given based on the dynamism of the economy, which until September was robust. The Monthly Economic Activity Index (Imae) grew 7.8% during the accumulated period from January to June 2023, driven by activities such as commerce, construction, tourism, banking, insurance, transportation and electricity, among others. https://www.newsroompanama.com/news/mining-protests-fallout-could-shrink-gdp-16 Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted December 13, 2023 Moderators Share Posted December 13, 2023 Quote Pensioners call for a permanent bonus Posted 12/12/2023 Members of the National Movement United for Retirees and Pensioners carrying banners and chanting slogans gathered in front of the offices of the General Directorate of Income (DGI), of the Ministry of Economy and Finance (MEF), located on Vía España on Tuesday, December 12. They were demanding that a permanent bonus be established for senior citizens and await a response from the authorities. Guillermo Cortés, a spokesperson for the retirees, said Monday in an interview with Telemetro Reporta that the permanent bonus would represent 45 million dollars a year, within the State budget a fraction of the amount allocated to perks for members of the National Assembly and their staff. https://www.newsroompanama.com/news/pensioners-call-for-a-permanent-bonus Quote Link to comment Share on other sites More sharing options...
Moderators Moderator_03 Posted January 1 Moderators Share Posted January 1 Quote Panama's economy grew 8.9% before anti-mining protests Posted 29/12/2023 Panama’s economy grew of 8.9% in the first nine months of 2023, compared to the same period of the previous year, but the effects of the anti-mining protests will not be seen until the first quarter of next year. The gross domestic product (GDP) reached $57,639.7 million from January to September 2023, according to information released on Friday, December 29. The increase represents an additional contribution of $4,687.9 million compared to the same period in 2022, according to the Comptroller General. During the third quarter of the year (July to September), the performance of the Panamanian economy showed an increase of 9%, compared to the similar period of the previous year. Construction The increase in quarterly GDP is mainly attributed to domestic sectors, such as construction, with an increase of 34.8% in the value of permits and 15.5% in car sales. Other sectors, such as the manufacturing industry, thermal electricity generation, and land transportation, with increases in passengers on the Metro and Mi Bus, contributed significantly. During October and November, the economy slowed down, after intense weeks of protests and citizen complaints against the exploitation contract of the Cobre Panamá mine with the Canadian company First Quantum Minerals. Finally, on November 28, the Supreme Court declared Law 406 unconstitutional, which contains the controversial contract approved by the National Assembly and the Executive. The weeks of protests left losses of at least $1 billion for the economy, according to calculations by business unions. These losses have changed the economic growth projection, which stood at 6% at the end of this year, to range between 5% and 4%, according to official estimates. https://www.newsroompanama.com/news/panamas-economy-grew-89-before-anti-mining-protests Quote Link to comment Share on other sites More sharing options...
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