Panama Growth To Accelerate In 2019, But Headwinds Loom

• Fitch Solutions forecast Panama's real GDP to grow at the fastest pace in the region at 4.8% in 2019 and 4.7% in 2020. Strong construction activity and increased use of the expanded canal will be key growth drivers.
• Growth is expected to remain below the pace seen over the last decade as global trade tensions and a strong dollar weigh on trade flows and canal activity.
• A further worsening of trade relations between the US and China, or the US and other major trade partners, could severely undermine government revenues, which are supported by Panama Canal transit fees.
• Over the long term, an increasingly close economic relationship with China could pose upside risks to Fitch’s growth outlook as stronger trade relations boost export volumes and investment helps to drive the expansion of the construction sector.

 (Source: Fitch)