Economy in Panama

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Economy—overview: Panama's economy is service-based heavily weighted toward banking commerce and tourism. Since taking office in 1994 President PEREZ BALLADARES has advanced an economic reform program designed to liberalize the trade regime attract foreign investment privatize state-owned enterprises institute fiscal privatized its two remaining ports along the Panama Canal in 1997 and approved the sale of the railroad in early assets including the electric company. Panama joined the World Trade Organization (WTrO) and . A banking reform law was approved by the legislature in early 1998 and will take effect in June. After two years of near stagnation the reforms are beginning to take root; GDP grew by 3.6% in 1997 and is expected to grow by more than 6% in 1998. The most important sectors driving growth have been the Panama Canal and the shipping and port activitiesThe Colon Free Zone also rebounded from a slow year in 1996.

GDP: purchasing power parity—$18 billion (1997 est.)

GDP—real growth rate: 3.6% (1997 est.)

GDP—per capita: purchasing power parity—$6 700 (1997 est.)

GDP—composition by sector:

agriculture: 8%

industry: 18%

services: 74% (1997 est.)

Inflation rate—consumer price index: 1.2% (1997)

Labor force:

total: 1.044 million (1997 est.)

by occupation: government and community services 31.8% agriculture hunting and fishing 26.8% commerce restaurants and hotels 16.4% manufacturing and mining 9.4% construction 3.2% transportation and communications 6.2% finance insurance and real estate 4.3%

note: shortage of skilled labor but an oversupply of unskilled labor

Unemloyment rate: 13.1% (1997 est.)


revenues: $2.4 billion

expenditures: $2.4 billion including capital expenditures of $341 million (1997 est.)

Industries: construction petroleum refining brewing cement and other construction materials sugar milling

Industrial production growth rate: 0.4% (1995 est.)

Electricity—capacity: 957 million kW (1995)

Electricity—production: 3.6 billion kWh (1995)

Electricity—consumption per capita: 1 355 kWh (1995)

Agriculture—products: bananas rice corn coffee sugarcane vegetables; livestock; fishing (shrimp)


total value: $592 million (f.o.b. 1997 est.)

commodities: bananas 43% shrimp 11% sugar 4% clothing 5% coffee 2%

partners: US 37% EU Central America and Caribbean


total value: $2.95 billion (c.i.f. 1997 est.)

commodities: capital goods 21% crude oil 11% foodstuffs 9% consumer goods chemicals

partners: US 48% EU Central America and Caribbean Japan

Debt—external: $7.26 billion (1996 est.)

Economic aid:

recipient: NA

Currency: 1 balboa (B) = 100 centesimos

Exchange rates: balboas (B) per US$1—1.000 (fixed rate)

Fiscal year: calendar year

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The economy of Panama is not widely known but they do have a free trade zone and export highly

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