With the Panama Papers, the Wakid money laundering scandal and some bad press all around, it’s a relief to see this week’s report that Panama’s economy is still one of the strongest performing in the region.
According to the Ministry of Economy and Finance, GDP growth numbers are once again in the very healthy mid 5% range, meaning the economy continues to grow at a healthy, sustainable pace. The good news is that the economy hasn’t experienced any spike in unemployment and the banking sector is also running healthy liquidity levels, meaning capital flight ended up being a non-issue.
We’ve had headwinds down here for sure, and it’s certainly possible that the collateral damage has yet to run it’s course. But so far, thru the first five months of the year, Panama’s economy is yet again on track to be one of the fastest growing in the world.
Long term, economic growth means businesses and their people moving to Panama. And new people in Panama means more demand for properties in Panama. And more demand for properties…you get the picture!
In related news, the construction sector which represents nearly 12% of the Panamanian workforce continues to grow, with retail construction growth leading the way according to Capital Financiero. The report mentioned that five major banks control over 70% of the current construction loan portfolio of nearly $6 billion: Banco General, Banistmo, Global Bank, Scotiabank and Multibank.