Panama Economic Activity February 2021


Panama: Decline in economic activity softens in February

April 21, 2021

Economic activity decreased 9.7% in year-on-year terms in February, which was markedly softer than January's 14.6% decrease. However, the print continued to show the impact of the pandemic’s fallout on activity. Looking at the first two months of the year, affected subsectors included hotels and restaurants, construction, manufacturing and transportation. That said, strong copper exports cushioned the fall somewhat.

Meanwhile, the trend pointed down, with the annual average variation of economic activity coming in at minus 18.2% in February, down from January's minus 17.1%.

The economy is set to gain steam this year after 2020’s contraction, as the impact of Covid-19 dissipates.

On the economic outlook for key sectors, analysts at EIU commented:

“Following pandemic-induced disruptions, activity at the Cobre Panamá mine is set to accelerate; the mine is expected to produce over 330,000 tonnes of copper and more than 145,000 troy oz of gold per year by 2023. This, along with a ramping-up of public works projects, such as the US$4.4bn expansion of the metro system in the capital, Panama City (due for completion by 2025), will help to boost investment. Delays to other projects, including the construction of a new bridge over the Panama Canal (valued at US$1.5bn) will preclude faster growth.”

FocusEconomics Consensus Forecast panelists see the economy expanding 9.2% in 2021, which is up 0.6 percentage points from last month’s forecast. The panel expects GDP to grow 5.8% in 2022.

Author:, Junior Economist

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Panama Economic Activity Chart

Panama Economic Activity February 2021

Note: Year-on-year changes and annual average variation of economic activity in %.
Source: Instituto Nacional de Estadística y Censo.

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