In Spanish, we refer to Panama as the 3P´s “puente, paso, puerta” (bridge, passage, and door). Panama is the bridge between Central/North America and South America, the passage that links the Pacific Ocean and the Caribbean Sea and an open door for everyone. We are truly the crossroads of the world. From the moment Vasco Nuñez de Balboa discovered the South Sea (Pacific Ocean), we became a logistics hub. Our Pacific Coasts were used as embarkation ports for all exploratory missions to Central and South America, while our Caribbean Coasts were used as trading posts and departure spots for the Old Continent. Later on, the first inter-oceanic railroad was built, by the US, and proved to be the fastest link between the West and East Coast cities. Panama is also the place that the King of Spain, Charles V, originally recognized as a potential site for creating a water passage, and which was chosen by France in 1881 and later taken over by the US in 1904 for the construction of the Panama Canal. Officially opened on August 15, 1914, the Panama Canal greatly reduced the amount of time ships took to travel between the Atlantic and Pacific Oceans, enabling them to avoid the lengthy, hazardous Cape Horn route around the southernmost tip of South America. This route opened new markets and possibilities and helped integrate the nations in and around the Pacific Ocean into the world economy. On August 20, 2013, the Panama Canal inaugurated the third set of locks, which facilitate the passage of larger ships to transport more than twice the cargo that they transported through the original locks  


An accumulated growth of the Gross Domestic Product (GDP) of 14.9% by the Panamanian economy was registered in the first nine months of 2021.

The economic sectors that drove the economic recovery and that grew the most were: Commerce (17.6%), Construction (28.7%), Transport, Storage and Communications (10.6%), Manufacturing Industry (11.4%) and the Agricultural Sector (3.4%) , as well as those industries that generated positive added value due to the exchange with the rest of the world, among which it is worth highlighting the exploitation of mines and quarries, by boosting the economy with the production of copper minerals and their concentrates; the Panama Canal, port services, air transport and the Colon Free Zone.

Fuente: Instituto Nacional de Estadística y Censo (INEC) de la Contraloría General de la República.     


An inflation of 1.6% was accumulated between January and December 2021, while the year-on-year variation stood at 2.6%, according to data from the National Institute of Statistics and Census (INEC).

The National Urban Interannual Consumer Price Index (CPI) 2021-2020 to December grew mainly driven by transportation items (10.5%); education (3.1%), and housing, water, electricity, and gas (2.3%).

The increase in the prices of food and non-alcoholic beverages (2.2%) also boosted the index; restaurants and hotels (2%); furniture, articles for the home and for the ordinary maintenance of the home (0.7%); health, and miscellaneous goods and services, both with 0.6%.

On the other hand, the groups that registered a decrease in prices at the interannual level were alcoholic beverages and tobacco (-0.8%); clothing and footwear (-0.6%); recreation and culture (-0.5%) and communications at 0.2%.

Fuente: Instituto Nacional de Estadística y Censo (INEC) de la Contraloría General de la República.

According to the Ministry of Economy and Finance of Panama, the country's economic growth behavior in 2021 was higher than the regional and world average and it is expected to continue along the same lines in 2022.

Fuente: Presentación MEF



The flow of Foreign Direct Investment (FDI) in the Panamanian economy as of March 2021 reached a net balance of B/.453.6 million, representing an absolute decrease of B/.622.3 million, that is, a reduction of 57.8% compared to 2020, influenced by the reduction in the deficits registered by international license banks, the Colon Free Zone, among others. The behavior of these sectors is still affected by the effects of Covid.19.

The only sector that grew was the general license banks, whose investment showed a growth of 119% after accumulating US$ 573.7 million in the first semester. According to the information provided by the National Institute of Statistics and Census (INEC), the largest amount of money was obtained from reinvested profits for US$ 402.5 million.


Fuente: Instituto Nacional de Estadística y Censo (INEC) de la Contraloría General de la República.



Panama, a small, dollarized economy, had one of the strongest growth performances in Latin America and the Caribbean (LAC) before the COVID-19 crisis. The country grew by 4.7% on average from 2014 to 2019, while LAC grew by 0.9%. Rapid growth and prudent fiscal management allowed Panama to achieve investment grade and access private financing markets at low cost.

Panama faced to the COVID-19 crisis by maintaining roughly the same levels of investment as in 2019, while expanding social spending, despite a large drop in revenue (21.2% in 2020). Consequently, the fiscal deficit widened to 10.3% of GDP in 2020. The fiscal expansion was mainly debt-financed, made possible by ample access to multilateral and market financing. At the end of September 2021, the accumulated current income in cash of the State totaled B/.4,187.87 million, which reflects a surplus of B/.733.18 million (21.22%), compared to the same period of the year 2020, as detailed in the Preliminary Collection Report of the General Directorate of Revenue (DGI).

In August 2021, the risk rating agency Standard & Poor's (S&P) reaffirmed Panama's sovereign rating at BBB, maintaining the country's investment grade, while the outlook changed from stable to negative, basically due to the impact of the pandemic on the economy. S&P indicated that Panama has improved its debt profile in recent years to mitigate refinancing risk. The average maturity of the debt is just under 13 years and 80.5% of the debt is at a fixed rate. Additionally, the weighted average cost was 3.9% in December 2020, and the limited amount of short-term debt (Treasury Bills), coupled with a mostly stable maturity profile through 2024, contains refinancing risk.

For its part, Fitch Ratings downgraded Panama's sovereign rating from BBB to BBB- and revised the outlook to negative, maintaining the investment grade. According to the rating agency, the decision to lower the rating is based on the negative effect that the pandemic has had on the country's economy and public finances.

Moody's, in its summary of the Annual Credit Analysis dated October 29, 2021, conferred a Baa2 Outlook Stable rating on Panama.

According to the Multilateral Banking and risk rating agencies, Panama's economic growth projections for 2022 are favorable:



In Panama, you will find a great variety of investment incentives. The following are the main Foreign Direct Investment Incentive Laws..

Régimen Especial EMMA

Click on each link to access more information.


At the end of 2020, Panama exported $1,725.5 million dollars. So far in 2021, to the period January-November 2021, Panama has exported (including the copper item) a total of $3,148.4 million dollars.

Without the inclusion of the copper item, Panama exported a total of $659.9 million dollars in 2020. From January to November 2021, the amount of $680.8 million has been sent. The main destinations for Panamanian exports are the Netherlands, the United States, China, India, Japan, and Spain, among others.

In the period January-December 2020, a total of $105.7 million dollars was exported to the United States. From January to November 2021, $120.1 million have been exported.

The main products were bananas, cane sugar, fresh salmonids, frozen and farmed shrimp, coffees (roasted, non-decaffeinated, decaf, gold), yellow fin tuna and striped-bellied tuna or bonito, fresh snappers, cobia fish, offal aluminum, iron and copper, goldfish, other fresh fish, grouper, gourd, rum, candles-similar items, raw lead, pineapples and ambergris. These 25 items generated a total of $112.4 million corresponding to 93% of exports to the United States.

On the other hand, currently 42 companies export under the Panama Exports seal, of which 17 of them export to the United States market.

Source: National Directorate for Export Promotion – Ministry of Commerce and Industry of Panama



The Trade Promotion Agreement between The United States of America and Panama has set a new commercial phase, increasing the ease of doing business between these countries.

As for Panama, the government has enacted “Free Zones” governed pursuant to Law N° 32, April 5th, 2011, “Through which a Special, Integral and Simplified Regime for the Creation and Operation of Free Zones is Established and Dictate Other Provisions”.

The Free Zones law establishes several Fiscal, Migratory and Labor incentives.

The permitted activities, previous to the export procedure, within these Zones are:

  • Manufacturing
  • Assembly
  • Processing
  • Sale of goods and services
  • Telecommunications (Call Centers)

Click on the link below to download the complete law:

Export Processing Zones: Law N° 32, April 5th, 2011 (in Spanish)