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The Economy of Panama

Panamanian Economy

Panama's map

Economy - overview: Panama's dollarized economy rests primarily on a well-developed services sector that accounts for 80% of GDP. Services include operating the Panama Canal, banking, the Colon Free Zone, insurance, container ports, flagship registry, and tourism. Economic growth will be bolstered by the Panama Canal expansion project that began in 2007 and is scheduled to be completed by 2014 at a cost of $5.3 billion - about 25% of current GDP. The expansion project will more than double the Canal's capacity, enabling it to accommodate ships that are now too large to transverse the transoceanic crossway, and should help to reduce the high unemployment rate. Strong economic performance has reduced the national poverty level to 29% in 2008; however, Panama has the second most unequal income distribution in Latin America. The government has implemented tax reforms, as well as social security reforms, and backs regional trade agreements and development of tourism. Not a CAFTA signatory, Panama in December 2006 independently negotiated a free trade agreement with the US, which, when implemented, will help promote the country's economic growth.

GDP:

GDP - real growth rate: 8.3% (2008) 11.2% (2007 est.) 8.7% (2006 est.)

GDP - per capita:

GDP - composition by sector: agriculture: 6.2% industry: 16.1% services: 77.6% (2008 est.)

Population below poverty line:

Household income or consumption by percentage share: lowest 10%: 0.7% highest 10%: 43% (2003)

Distribution of family income - Gini index: 56.1 (2003)

Inflation rate (consumer prices):

Labor force: 1.392 million note: shortage of skilled labor, but an oversupply of unskilled labor (2008 est.)

Labor force - by occupation: agriculture: 15% industry: 18% services: 67% (2006)

Unemployment rate: 6.3% (2008 est.)

Budget: revenues: $6.09 billion expenditures: $6 billion (2008 est.)

Industries: construction, brewing, cement and other construction materials, sugar milling

Industrial production growth rate: 6.6% (2008 est.)

Electricity - production: 5.805 billion kWh (2006 est.)

Electricity - production by source:

Electricity - consumption: 4.768 billion kWh (2006 est.)

Electricity - exports: 124.9 million kWh (2007 est.)

Electricity - imports: 8.74 million kWh (2007 est.)

Oil - production: 0 bbl/day (2007 est.)

Oil - consumption: 92,790 bbl/day (2006 est.)

Oil - exports: 4,447 bbl/day (2005)

Oil - imports: 88,790 bbl/day (2005)

Oil - proved reserves: 0 bbl (1 January 2006 est.)

Natural gas - production: 0 cu m (2007 est.)

Natural gas - consumption: 0 cu m (2007 est.)

Natural gas - exports: 0 cu m (2007 est.)

Natural gas - imports: 0 cu m (2007 est.)

Natural gas - proved reserves: 0 cu m (1 January 2006 est.)

Agriculture - products: bananas, rice, corn, coffee, sugarcane, vegetables; livestock; shrimp

Exports: $10.37 billion f.o.b.; note - includes the Colon Free Zone (2008 est.)

Exports - commodities: bananas, shrimp, sugar, coffee, clothing

Exports - partners: US 35.6%, Netherlands 10.2%, China 6%, Sweden 5.5%, UK 5.4%, Costa Rica 5.1%, Spain 5% (2007)

Imports: $15.18 billion f.o.b. note: includes the Colon Free Zone (2008 est.)

Imports - commodities: capital goods, foodstuffs, consumer goods, chemicals

Imports - partners: US 32.8%, Netherlands Antilles 7.6%, China 5.6%, Japan 5.1%, Costa Rica 5.1%, South Korea 4.1% (2007)

Debt - external: $10.89 billion (31 December 2008 est.)

Economic aid - recipient:

Currency:

Currency code:

Exchange rates: balboas (PAB) per US dollar - 1 (2008 est.), 1 (2007), 1 (2006), 1 (2005), 1 (2004) note: the US dollar is the legal currency

Fiscal year: