ECONOMIC PROFILE
With a privileged geographical location, at the junction of Central and South America, Panama boasts one of the world’s fastest growing economies, expanding at a rate of well in excess of 10 percent per annum.
The Panamanian economy rests primarily on its well-developed financial and services sector, accounting for more than three-quarters of GDP. The country is one of the region’s largest banking centers, and also one of the most important logistic centers in the Western Hemisphere, controlling the most traveled waterway between the Atlantic and Pacific oceans. The Panama Canal presently serves more than 14,000 ships a year, traveling eastward and westward.
Panama also is home to the Colón Free Zone, the most important tax free zone one in the Western hemisphere, with an annual exchange trade worth $19 billion. But it is not the only one. The Panamá Pacífico Special Economic Area is being developed and eventually will serve as a space for the production of goods and high technology services, and the Free Zone of the Panama Diamond Exchange and the World Jewelry Hub will serve the interests of the diamond, jewelry and gemstones trades in Latin America and internationally.
Panama is a key connecting point for travel throughout Latin America, with its largest airport, Tocumen International, being the busiest in Central America. Located on the outskirts of Panama City and currently is undergoing a major expansion, the airport is home to Copa Airlines, which 180 flights to 55 destinations in 27 countries, the most extensive service available in the region. Its routes are complemented by more than 20 other airlines, which serve Tocumen from Europe and the Americas.
Another reason for the country’s rapid economic growth is the Panamanian government’s aggressive infrastructure development program. In addition to the $5.25 billion Panama Canal project that has almost doubled the waterway’s capacity, Panama has also constructing a metro system in Panama City, valued at $1.2 billion.
Panama also enjoys preferred trading partner status with a number of countries, the most important being the United States. The U.S.-Panama Trade Promotion Agreement was approved by the U.S. Congress and signed into law in October 2011, and entered into force in October 2012. The country also has free-trade treaties with Taiwan, El Salvador, Singapore and Chile.