International rating agency Moody's is analyzing the economic situation in Panama. The main focus is not so much on specific figures, but on the country's ability to act as a sovereign with an investment-grade rating amid a budget deficit. The agency emphasizes that for Panama, it is critically important to consolidate the budget through structural measures with broad political consensus, rather than through one-off decisions. In 2025, Panama managed to reduce the deficit from 7.3% to 4.4%, which was recognized as a significant effort. However, this is not enough to remove the negative outlook. Moody's expects that in 2024, concrete measures will be taken to address chronic problems, such as tax inefficiency and the rigidity of budget expenditures. The decision on whether to maintain or lower the investment-grade rating will be made by the end of 2024. The National Assembly of Panama will play a key role in this process, as its reaction to the government's proposals will determine the country's future.
