Panama: Strong growth prospects overshadow concerns over tax transparency

​Favourable outlook for growth

Panama has been the fastest growing economy in Latin America over the past two decades. It benefitted from the activity of the canal, the Colon free trade zone (CFZ), and its role as an international banking center and a regional financial hub. Panama’s economic openness relies on numerous free trade agreements. Though GDP growth in Panama has moderated from its 2011-12 highs, it is estimated to reach +5.3% in 2017 and +5.8% in 2018. Price pressures remain subdued, but should pick up in 2018-19 as commodity prices recover.