December 31, 2025
Panama’s central economic challenge is clear: project itself confidently to the world while ensuring that growth does not bypass the domestic economy. Business leaders argue that the country must strike this balance if it is to translate stable growth forecasts into sustained job creation and broader prosperity.
Economic projections for the coming year remain encouraging. The Economic Commission for Latin America and the Caribbean (ECLAC) estimates that Panama’s gross domestic product (GDP) will expand by 3.8%, while local forecasts point to growth of around 4%, driven largely by investment projects scheduled to begin in the first months of the year. However, economists caution that these projections hinge on a decisive restoration of investor confidence.
According to Juan Arias Strunz, president of the Chamber of Commerce, Industries and Agriculture of Panama (CCIAP), Panama already possesses many of the structural conditions sought by foreign investors, including dollarisation, democratic institutions and special investment regimes. What remains under scrutiny, he argued, is credibility. “Confidence is what companies will ultimately evaluate,” he said, stressing that this must be reinforced to stimulate employment and long-term growth.
Arias Strunz highlighted recent agreements reached at the minimum wage negotiating table as a positive signal to international investors. The consensus between employers and workers, he noted, demonstrates institutional maturity and a willingness to prioritise the common good over narrow interests. Such signals are critical for sectors like tourism, where Panama holds a competitive edge within the region.
He pointed in particular to the strategic importance of Tocumen International Airport, through which more than 19 million passengers transit annually. Converting even a fraction of this flow into longer stays could generate significant income for both large enterprises and small businesses across the country. “Panama needs to show the world everything we have and can do; that way we will create a lot of jobs,” Arias Strunz said.
Labour consultant René Quevedo echoed this view, arguing that unemployment is less a question of job availability and more a crisis of confidence. “We need to convey that investing in Panama is good business,” he said, emphasising the need for clear rules, stability and policy consistency. While maintaining an investment-grade credit rating remains important, Quevedo noted that examples such as Costa Rica show that strong foreign investment inflows are possible even without such a rating.
The domestic challenge is becoming more urgent. Data from the National Institute of Statistics and Census of Panama (INEC) place unemployment at 9.5%, with expectations that it could move into double digits, levels not seen in two decades. Authorities nevertheless project economic growth of 4% in 2026, underscoring the importance of aligning external investment strategies with domestic job creation.
Ultimately, as both business leaders and economists agree, Panama’s success will depend on its ability to inspire confidence abroad while nurturing the internal economy that remains the country’s largest source of employment.
Source: (Newsroom Panama)
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