Panama Economy 2007

Economy - overview:
Panama's dollarized economy rests primarily on a well-developed services sector that accounts for three-fourths of GDP. Services include operating the Panama Canal, banking, the Colon Free Zone, insurance, container ports, flagship registry, and tourism. A slump in the Colon Free Zone and agricultural exports, the global slowdown, and the withdrawal of US military forces held back economic growth in 2000-03; growth picked up in 2004-06 led by export-oriented services and a construction boom stimulated by tax incentives. The government has implemented tax reforms, as well as social security reforms, and backs regional trade agreements and development of tourism. Unemployment remains high. In October 2006, voters passed a referendum to expand the Panama Canal to accommodate ships that are now too large to transverse the transoceanic crossway. Not a CAFTA signatory, Panama in December 2006 independently negotiated a free trade agreement with the US, which, when implemented, will help promote the country's economic growth.

GDP (purchasing power parity):
$26.16 billion (2006 est.)

GDP (official exchange rate):
$16.47 billion (2006 est.)

GDP - real growth rate:
8.1% (2006 est.)

GDP - per capita (PPP):
$8,200 (2006 est.)

GDP - composition by sector:
agriculture: 7.3%
industry: 16.5%
services: 76.3% (2006 est.)

Labor force:
1.439 million
note: shortage of skilled labor, but an oversupply of unskilled labor (2006 est.)

Labor force - by occupation:
agriculture: 20.8%
industry: 18%
services: 61.2% (1995 est.)

Unemployment rate:
8.8% (2006 est.)

Population below poverty line:
37% (1999 est.)

Household income or consumption by percentage share:
lowest 10%: 0.7%
highest 10%: 43% (2003)

Distribution of family income - Gini index:
56.1 (2003)

Inflation rate (consumer prices):
1.1% (2006 est.)

Investment (gross fixed):
15.3% of GDP (2006 est.)

Budget:
revenues: $4.283 billion
expenditures: $4.195 billion (2006 est.)

Public debt:
58.4% of GDP (2006 est.)

Agriculture - products:
bananas, rice, corn, coffee, sugarcane, vegetables; livestock; shrimp

Industries:
construction, brewing, cement and other construction materials, sugar milling

Industrial production growth rate:
3% (2006 est.)

Electricity - production:
5.661 billion kWh (2005)

Electricity - consumption:
4.735 billion kWh (2005)

Electricity - exports:
51 million kWh (2005)

Electricity - imports:
55 million kWh (2005)

Oil - production:
0 bbl/day (2004 est.)

Oil - consumption:
79,000 bbl/day (2004 est.)

Oil - exports:
NA bbl/day

Oil - imports:
NA bbl/day

Oil - proved reserves:
0 bbl (1 January 2006)

Natural gas - production:
0 cu m (2005 est.)

Natural gas - consumption:
0 cu m (2005 est.)

Current account balance:
$-378.2 million (2006 est.)

Exports:
$8.509 billion f.o.b.; note - includes the Colon Free Zone (2006 est.)

Exports - commodities:
bananas, shrimp, sugar, coffee, clothing

Exports - partners:
US 39.8%, Spain 8.1%, Netherlands 6.7%, Sweden 5.6%, Costa Rica 4.5% (2006)

Imports:
$10.31 billion f.o.b. (includes the Colon Free Zone) (2006 est.)

Imports - commodities:
capital goods, foodstuffs, consumer goods, chemicals

Imports - partners:
US 27%, Netherlands Antilles 10.1%, Costa Rica 5.1%, Japan 4.7% (2006)

Economic aid - recipient:
$19.54 million (2005)

Reserves of foreign exchange and gold:
$1.335 billion (2006 est.)

Debt - external:
$9.972 billion (2006 est.)

Stock of direct foreign investment - at home:
$NA

Stock of direct foreign investment - abroad:
$NA

Market value of publicly traded shares:
$5.074 billion (2005)

Currency (code):
balboa (PAB); US dollar (USD)

Exchange rates:
balboas per US dollar - 1 (2006), 1 (2005), 1 (2004), 1 (2003), 1 (2002)