Panamanian Minister of Economy and Finance, Felipe Chapman, assures in an interview with EFE that the government is developing plans that will increase foreign investment in Panama «in a very interesting way», a flow the country is eager to attract to reduce unemployment and boost fiscal revenues. Panamanian President José Raúl Mulino has announced an ambitious infrastructure plan and implemented economic measures and spending controls that have restored confidence in this dollarized Central American country, home to the interoceanic Canal and a regional logistics hub seeking to increase its relevance. "I am confident that as tangible results from the plans being carried out by this government begin to be seen, this will accelerate and we will see a very interesting increase in investment in the country. And these are resources that one would expect to be dedicated to strategic investments that typically generate jobs in the vast majority of cases," he adds. The unemployment rate in Panama is 9.5% and the informality rate is 49.3%, according to official statistics for October 2024, although local analysts calculate that unemployment already exceeds double digits. "I am pushing the private sector's cart, seeking that foreign investment in issues as important as, and very soon, the projects of the Panama Canal Authority, the port, the gas pipeline (...) and everything we are going to promote in terms of logistics," President Mulino has stated. Minister of Economy and Finance Felipe Chapman emphasizes that «added to that, a reinvestment of profits by local companies», according to him. He points out that Panama is already accelerating the attraction of direct and financial investments, citing as examples this year's purchase of the railway through the Canal by an independent division of the Danish shipping company Maersk, and the sale of Cemex's operations in Panama to the Dominican Grupo Estrella. APM Terminals (APMT) disbursed $600 million to take over the operations of the Panama Canal Railway Company (PCRC), while Grupo Estrella paid $200 million for Cemex's plant. "And there are several such cases this year, with just these two cases we are talking about amounts approaching $1 billion, which are significant, close to more than 1% of the gross domestic product (GDP)" of the country, the minister points out. Chapman recalls that the flow of foreign currency in Panama is created «by the export of services, primarily, such as those offered by the Canal, tourism, logistics, banking, "and they are growing"." According to estimated data from the National Institute of Statistics and Census (INEC), Foreign Direct Investment (FDI) in Panama reached $2,832.6 million in 2024, an increase of 28.9% over the previous year, driven largely by the reinvestment of profits by companies already in the country. That reinvestment drives FDI has been a feature of Panama for years, and even during part of the 2010s it led the indicator in Central America, which, in the opinion of several local analysts, could explain its low incidence in job creation, as it may be an accounting decision. But Minister Chapman asks not to "underestimate" reinvestment as a driver of FDI because for a company to "make the strategic decision to reinvest its profits or earnings instead of withdrawing them as dividends, is a very powerful message of confidence in the country and a desire to grow more." "The international methodology for calculating foreign investment includes the reinvestment of profits (...) because that profit that is reinvested allows for growth."
