Is panama city a rich country?

Panama is a high-income economy with a history of low inflation. Panama is a small country of about 4.4 million people. It has benefited from steady economic growth, but poverty and income inequality have been persistent and have disproportionately affected rural indigenous territories and Afro-Panamanian populations. It should be noted that the increase of protected land from 33% to 54% and strong ocean conservation efforts have made Panama one of the only three countries in the world with negative carbon emissions.

The following table is an imperfect attempt to evaluate Panama's per capita income level (expressed as the GDP per capita of the World Economy) and Panama's per capita wealth (based on data derived from the Credit Suisse Wealth Report 202 and using United Nations population data). Since 1970, the share of the manufacturing industry has steadily declined, reflecting a structural change in the Panamanian economy. After their arrival in Panama in 1501, the Spanish turned Panama into the main crossroads and market of the great Spanish Empire. The United Nations Human Development Report 2000 ranked Panama 59th out of 172 countries.

The ratio is calculated by comparing the proportion of real income adjusted for PPP by the ratio between household consumption and GDP in Panama and the United States. Panama has achieved faster income convergence compared to U.S. standards over the past 25 years than most other Latin American countries and is now the richest country in Latin America. The decomposition of growth shows that much of the increase in production came from investment, especially in construction, in recent years, while mining activity became a new source of GVA with the development of Cobre Panama.

There are also high levels of drug use, and Panama is often cited as one of the main areas for shipping drugs from South America to the United States. Compared to other Asian tigers, or even to the Dominican Republic, their fast-growing regional counterpart, Panama has experienced significantly lower growth in the TFP. Among the poorest in Panama are indigenous native peoples, who represent about 8 percent of the population (194,000). Panama has concluded more than a dozen free trade agreements that cover trade relations with more than 40 countries and territories.

During this period, the acceleration of growth was mainly driven by residential and commercial construction, the development of one of the largest copper mines in the world (Cobre Panama) and public investment projects, such as the expansion of the Panama Canal and the expansion of the Tocumen International Airport.

Abigail Angelotti
Abigail Angelotti

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