Panama GDP Q1 2019


Panama: Growth falters in Q1 on softer construction, shipping and financial services growth

June 17, 2019

According to data released by the National Comptroller’s Office, the economy lost traction in the first quarter of 2019, interrupting a growth rebound that had started two quarters prior. Economic growth fell from 4.0% year-on-year in Q4 to just 3.1% in Q1, matching the decade-low reading logged in Q2 2018. This feeble growth print came primarily on the back of softer momentum in the country’s main growth engines: shipping, construction, and financial services.

Looking at the sectoral breakdown, the agricultural sector’s contraction worsened from 4.8% year-on-year in Q4 to 5.0% in Q1, as the fishing sector shrank by nearly 40% in annual terms. The industrial sector, meanwhile, lost steam (Q1: +3.7% yoy; Q4: +4.5%) primarily due to lower but still robust growth in construction, which represents more than half of all industrial activity. In addition, growth in mining and quarrying also slowed, while the manufacturing sector continued to contract slightly, at the same rate as in Q4. On the other hand, growth in the utilities sector picked up steam, thanks largely to a new natural gas plant coming online in the quarter.

Finally, turning to services, growth held up reasonably well, slowing from 3.3% in Q4 to 3.0% in Q1. The slowdown was in good part driven by lower momentum in the crucial transport, warehousing and communications sector, which encompasses shipping activity from the Panama Canal. Increased trade protectionism and weaker global growth likely weighed on the sector in the quarter, and also held down the equally important retail and wholesale trade sector, which includes activity in the Colón Free Trade Zone and grew at a similarly meek pace as in Q4. Moreover, the financial sector also lost steam in Q1. On the other hand, the print was supported by a pick-up in the real estate sector, as well as a clear rebound in the hospitality sector, after four consecutive quarters of contraction, indicating that inbound tourism regained some momentum.

FocusEconomics Consensus Forecast panelists project that the economy will grow 4.6% in 2019, which is down 0.3 percentage points from last month’s forecast, and 4.6% again in 2020.

Author:, Economist

Sample Report

Looking for forecasts related to GDP in Panama? Download a sample report now.


Panama GDP Chart

Panama GDP Q1 2019 1

Note: Year-on-year changes of GDP in %.
Source: National Comptroller’s Office and FocusEconomics Consensus Forecast

Panama Economic News

  • Panama: Consumer prices fall in August

    September 13, 2019

    Consumer prices dropped 0.3% over the prior month in August, contrasting the 0.2% increase registered in July.

    Read more

  • Panama: Economic activity picks up in June

    August 21, 2019

    The monthly indicator for economic activity (IMAE, Índice Mensual de Actividad Económica) grew 2.9% over the same month a year prior in June, accelerating from the 2.4% expansion registered in May. Increased economic activity in June was driven by stronger growth in the transport, storage and communications sector—which includes activity in the Panama Canal and national ports.

    Read more

  • Panama: Consumer prices fall at weaker pace in annual terms in July

    August 14, 2019

    Consumer prices rose 0.2% over the previous month in July, contrasting the 0.3% decline registered in June.

    Read more

  • Panama: Economic activity loses traction in May

    July 22, 2019

    The monthly indicator for economic activity (IMAE, Índice Mensual de Actividad Económica) grew 2.4% in annual terms in May, down from the 2.9% expansion logged in April and marking the worst performance since July 2018. Slower economic activity in May was primarily the result of weaker growth in the construction; mining and quarrying; real estate; trade; and hotels and restaurants sectors.

    Read more

  • Panama: Consumer prices fall year-on-year in June

    July 15, 2019

    Consumer prices fell 0.3% over the prior month in June, contrasting the 0.1% increase recorded in May.

    Read more

More news

Search form