PANAMA
Analyst
Marco Fernandez
Former Economic Advisor, Ministry of PlanningDatabanks
Recent Country Insights
Large 2024 deficit (7.35% of GDP) and commitment of MEF to reduce it to less than the 4.0% ceiling of the Fiscal Law
PANAMA · In Brief · 20 Feb 2025
Today, Minister Chapman presented the fiscal situation for the end of 2024 and perspectives for 2025. The deficit of the NFPS of 7.35% in 2024, above our estimate of 6.2% and above the 2.0% that the Fiscal Law established in the 2020 revision by Minister Alexander. The explanation is twofold: und...
The proposal for reforms to the CSS pension plan presented by the government was modified by the Labor Commission of the Legislative Assembly on Tuesday night
PANAMA · In Brief · 05 Feb 2025 · 3 responses
Most legislators opposed the proposal due to the three-year increase in the retirement age, arguing that the Government failed to adjust the public sector payroll, thus placing the financial burden on the older population. This claim holds some truth: the number of new public employees increased ...
Mr. Trump and the Panama Canal: An “external shock” and the necessity of a three-phase strategy for Panama
PANAMA · Report · 21 Jan 2025
Panama has been in the international economic and political spotlight in recent weeks, particularly following President Donald Trump’s inaugural address on January 20: “We are going to take back the Canal that was unfairly taken from us by Panama and which imposes unjustly high tolls.” This re...
Pension reform postponed, again… Martinelli loses in court, again… First Quantum seeks allies, again… Trump tries to influence Panama, again.
PANAMA · Report · 23 Dec 2024
Two tasks were pending for December 2024: (1) the Government's Economic Program (PEG), which we will analyze in detail in early January once it is officially published. It will form the basis for our projections for the next five years; and (2) the CSS reform, particularly the pension plan within...
The reform of the pension system goes to the Legislative Assembly
PANAMA · Report · 15 Nov 2024 · 1 response
The reform of the CSS legislation, in particular the pension system, is the most recent initiative of the Mulino administration, after the Fiscal Responsibility Law enacted at the beginning of the month (which suffered minor changes in the legislative) and the Budget Law, which was changed substa...
The 2024-2025 economic reform's timeline: two steps forward, still four to go
PANAMA · In Brief · 01 Nov 2024
Summary We discuss the key reforms that will take place during the Mulino administration. The Fiscal Responsibility Law (LRSF) and the Public Sector Budget for 2025 were approved last week, with political setbacks. The Legislative Assembly (AN) introduced changes in the proposal of the Ministry o...
Another setback for the Executive: the Budget Committee returns the MEF Proposal... we analyze the options of both groups
PANAMA · In Brief · 23 Oct 2024 · 1 response
The 2025 budget project, approved by the cabinet on October 15 and presented the same day to the Assembly, was returned (not rejected) after the first debate in the Legislative Assembly. The 15 members of the budget committee requested the Minister of Economy and Finance to modify his proposal to...
New Fiscal Social Responsibility Law is approved by the Cabinet and submitted to the Legislative Assembly
PANAMA · In Brief · 18 Oct 2024
On October 14, the Assembly received the proposal for a new fiscal law (LRSF in Spanish). This law is necessary to establish the deficit ceilings before enacting the 2025 budget (which we will comment on in an upcoming report). This new version of the LRSF includes three topics within the same bo...
The order of factors does affect the product: a defeat for the Executive in the Assembly
PANAMA · In Brief · 11 Oct 2024 · 1 response
This week, the Executive Branch presented its proposal for the 2025 national budget to the Legislative Branch, which was challenged on Thursday by the Budget Commission for three reasons: (1) it was not submitted on time, as the Constitution (Article 184) requires the proposal to be sent within t...