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Panama’s Growing Pains

May 1, 2011

Rapid growth is still predicted, but the country is encountering speed-bumps along its way. Maintaining fiscal discipline and inflationary pressures will be among the challenges.

Keywords: Sean Mattson panama Sifón-Arevalo Sanofi-Aventis

by Sean Mattson

Panama is expected to remain near the top of LatAm’s GDP growth leaders list in 2011 with growth expected to surpass 7%, according to government and independent economist projections. It could be LatAm’s top GDP performer for the next decade, Banamex economist Sergio Luna said at a recent Council of the Americas conference in Panama City. He says Panama is projected to lead LatAm for the next decade with 6.9% average annual GDP expansion, after leading LatAm over the last decade with 6.1% growth. Panama ended 2010 with a 7.5% expansion, according the government’s initial estimate.

FDI is pouring in, with the small Central American nation of 3.4 million people attracting $2.36 billion in 2010, a 33% increase on a year earlier, according to government statistics. The $5.25 billion expansion of the Panama Canal leads an impressive package...

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