One of the fastest growing economies in Latin America, Panama’s gross domestic product (GDP) grew by 10.6% in 2012, following on from double-digit growth in 2011. Unemployment is at an all-time low, with a 4.4% unemployment rate recorded in 2012. Meanwhile, the expansion of the Panama Canal – which connects the Atlantic Ocean with the Pacific Ocean – is set to generate so much revenue that the country decided to set up a sovereign wealth fund to manage excess income.
All of this means that Panama’s finance minister, Frank De Lima, is one of the few finance ministers in the world with something to smile about at the moment. “Once the canal expansion is completed, the increase in revenue will sustain our investment programme: the government will invest $14bn over five years, excluding the Panama Canal expansion. The next administration will have the capacity to invest nearly $19bn,” he says. “The excess revenue will be sent to the sovereign wealth fund. The idea is that the fund will have $6bn by 2025.”
