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Panama Economic Activity September 2023

Panama: Economic activity records slowest expansion since October 2022 in September

Economic activity increased 6.5% year on year in September, which was a deterioration from August’s 11.1% increase. September’s outturn marked the worst reading since October 2022. Declining activity in the construction sector and in the Panama Canal due to the protracted drought contributed to the weaker reading, outweighing growth in the hospitality and mining and quarrying industries, among others. In addition, daily protests against the government’s deal with Canadian firm First Quantum Minerals over the exploitation of the Cobre Panama mine further disrupted activity.

Meanwhile, annual average economic activity growth fell to 8.1% in September (August: +9.4%), pointing to a worsening trend.

Analysts at the EIU commented on the outlook:

“Economic growth will slow sharply in 2024, based on Cobre Panamá remaining shut for much of the year. […] Even so, Panama’s growth rate will be much stronger than the regional average, as the country’s strategic location, its openness to trade, its ports and logistics sector, and its international financial sector will attract investors. […] We expect private consumption and investment to support economic growth.”

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