July 1, 2010
by Sean Mattson
Having turned the corner on the global recession with a still-expanding economy, nearly balanced books and three investment-grade seals of approval on its debt, Panama plans to plunge headlong this year into ambitious infrastructure spending under president Ricardo Martinelli.
The expenditure, which this year will be financed by multilaterals and local treasury issues, raises concern that Panama could lose the fiscal restraint that won it upgrades from Moodys, Fitch and S&P. Officials are however confident that budget deficits will be within strict legal limits, affirming Martinelli will end his term in 2014 with a reduced GDP-to-debt ratio.
Panama is pushing forward on infrastructure, canal expansion and mining. The sovereign is also developing the local debt curve.