Economy
grows 6.4%
It’s official. Despite an increase in inflation last year, 2005
was a very positive year for Panama’s economy, which grew 6.4%
during the last 12 months. The growth was motivated by the activity
of the financial sector (13.4 %), the maritime port system (12.2%),
air transport (18 %), the hospitality industry (15 %), the Colón
Free Zone (13.1%), and the export of agricultural products and the
tele-communications industry (15.3%)
According
to the General Comptroller of the Republic, the banking sector grew
by 16.4%, thanks to the incorporation of new commercial-license banks
and the growth of the credit sector due to the country’s booming
construction industry.
The year
was also a positive one for the Panama Canal (4%), the construction
industry, leasing companies (5.6%) and private education entities
(5.7%).Things were not so positive for the mining industry (0.4%),
the general construction sector (1%), the manufacturing industry (1.8%),
farming (3.1%) and fishing (2.6%).
Foreign
investment grows
Panama is still a magnet for foreign investment. According to the
last report of the General Comptroller of the Republic, foreign companies
invested US$1.27 billion in 2005. Although the figure only represents
a 1.5% increase compared to 2004, it reflects a 75% jump compared
to 2003 and 701% compared to 2002 figures.
The level
of foreign investment last year is close to that of 1997, when a number
of public utilities transferred to private hands, representing US$1.3
billion.
Last year’s
increase is partly attributed to the substantial growth of the Colón
Free Zone, which excelled in 2005 after approximately three years
of sluggish economic movement due to a lengthy, South American financial
crisis.
Presidential
summit
The Heads of State of the seven Central American countries and the
Dominican Republic met in Panama City this week for the annual summit
of the Central American Integration System (SICA) an organization
that seeks to unite the region into a single economic block. The list
of topics included the improvement of air, land and sea commercial
links and the consolidation of a regional position at an upcoming
summit between Latin America and the European Union.
Hotel
Taboga closes
Despite the positive numbers outlook of Panama’s fledgeing tourism
industry, Hotel Taboga, which until recently was considered one of
the few beach hotels on the isthmus, is no more. Its owners recently
stated it would operate until March 16, due to financial problems
caused by growing competition, both on the island of Taboga and the
mainland.
For years,
Hotel Taboga was the only lodging facility on the "Isle of Flowers",
which is located 12 nautical miles southwest of Panama City. At times,
it was managed by both private and public entities. As of this issue,
a number of local consortiums had expressed interest in purchasing
the 50-bedroom facility, but no decision has been reached so far.
A
safer Carnival
The National Police stated that this year, the number of deaths occurring
Panama’s pre-Lenten Carnivals has dropped over 77% compared
to last year’s figures. This reflects that Panamanians are starting
to become more conscious about safety precautions in a time when a
large percentage of the population takes the roads by storm, some
in obvious "fiesta mode". The four-day "Mardi-Gras",
which took place February 25-28, saw little activity in terms of road
accidents and trauma injuries.
Back
to school!
As of this issue, over 800,000 school kids will return to classes
throughout the republic. Last month, in order to help low-income public-sector
parents in their "back-to-school" expenses, president Martin
Torrijos approved the first installment of the "Thirteenth Month"
(a bonus paid to all Panamanian employees in three, quarterly installments)
a month in advance. The first weekend of March was, therefore, one
of the most commercially active in the country so far this year, as
thousands flocked to stores and malls to purchase school uniforms
and books. However, two weeks before the new school year began, the
Ministry of Education was still struggling to hire 160 teachers to
be sent to remote areas.
In Panama,
the school year extends from March to December.
Panama
gets ready for FTA
The government of Panama plans to invest US$240 million in the next
three years in what it calls a "complementary agenda" –a
plan designed to prepare public entities for the imminent signing
of a free trade agreement with the United States. The program also
covers aid and advisory services to a number of local industries.
Although
many Latin American countries have been able to sign free tree agreements
with the United States in a relatively short period in the last few
years, Panama’s negotiations with the giant from up north were
until recently rather slow, but picked up momentum after the visit
of George W. Bush to the Isthmus late last year.
New
houses for the poor in Los Santos
The Ministry of Housing plans to invest over half-a-million dollars
to build housing units for the poor in the province of Los Santos.
According to Anabella Huertas, director of the National Bureau of
Project Coordination, the investment will be used to build 206 houses
in the country’s southernmost province, the population of which
has decreased substantially in recent decades due to migration to
other parts of the Republic.
U.S.
Deputy Secretary of State visits Panama
It was recently announced that Karen Hughes, the U.S. Deputy Secretary
of State, will visit Panama on March 18 as part of an official tour
through Latin America. Her agenda on the Isthmus will include meetings
with student groups, NGO's, members of the civil society and top Panamanian
government officials.
Ms. Hughes
is not a stranger to Panama. She spent part of her childhood in the
former Panama Canal Zone where her father, Harold Partiff, served
as the last U.S.-appointed governor.
Let's
play ball!
Some of the best Panamanian baseball players of all times, including
Sherman Obando, Carlos Lee, Javier Vásquez and Rubén
Ribera have joined forces to represent Panama at the World Baseball
Championship, which is taking place in Puerto Rico this month. Many
eyes are on Panama's "Dream Team", which is considered by
experts the "third best national team in the world".
Baseball
is Panama's national sport –a legacy of the country's special
relationship with the United States during the 20th century.
