PANAMA REPORT: Stiff Upper Lip
Panama is defiant in the face of the global storm. However, inflation is a problem and its positioning as a hub may end up backfiring.
by Andrew Beatty
Swatting aside global economic crisis, Panamas veteran
economy minister Hector Alexander in early October bumped up
his countrys growth forecast for 2008 to 9.5%. It is a
brash stance for a country born globalised, whose leading
sectors shipping, commerce, construction and banking
make up around 43% of GDP and are inextricably woven
into the world economy.
The governments strategy of turning Panama into a
regional hub the Singapore of LatAm only
increases the exposure. Some 50% of Panamas exports,
including trans-shipping, now go to the US. Still Alexander is
optimistic. The economy is strong, he boasts.
Government bullishness is a significant turnaround from the
beginning of the year. After a strong end to 2007 which
saw economic activity jump 11.8% in Q4 rising worries
about inflation, overheating and contagion...
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