Panama: Transforming The Economy :: Rosemary Piper
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Panama: Transforming The Economy :: Rosemary Piper Presentation Transcript

  • 1. PANAMA: Rosemary Piper Deputy Director National Competitiveness Center Caribbean Growth Forum, Kingston, June 2012
  • 2. Quick Economic Overview: Gross Domestic Product 25,000 20,000 15,000 Year 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 % 0.6% 2.2% 4.2% 7.5% 7.2% 8.5% 12.1% 10.1% 3.9% 7.6% 10.6% 10,000 5,000 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 • 2012’s government forecast: 10% 2011
  • 3. Gross Domestic Product: Contribution by Sector Construction Commerce Transport, storage, communicat ions Financial Real estate, renting Manufacturing industries Others • Colon Free Zone, ports, Panama Canal and telecommunications: 24.2% • Commerce: 15.2% • Financial: 8.1% • Construction: 6.1%
  • 4. Foreign Direct Investment FDI (in USD billions) 3,000 2,500 2,000 1,500 1,000 500 0 2000 2001 2002 • • • • 2003 2004 2005 2006 2007 Last year: ports, mining and tourism Historic level in 2011: $2,790 Billions Source of innovation and “learning by doing” In 2010 LAC was the destiny of 10% of the FDI up from 5% in 2007 2008 FDI 2009 2010 2011
  • 5. Competitiveness Ultimate goal • Achieve sustainable development to improve the citizens’ quality of life Why we need to measure • “You can’t control what you don’t measure and you can’t improve what you cannot control”
  • 6. Important Competitiveness Indexes Panama’s Position (# of countries) Source 2007 2009 2011 2012 World Bank (Doing Business Index) 81 (175) 81 (181) 63 (183) 61 (183) World Economic Forum (Global Competitiveness Index) 59 (131) 59 (133) 53 (139) 49 (142)
  • 7. GCI: Evolution 2005-2011 70 65 65 60 59 60 58 59 55 53 50 49 45 2005-2006 GCI = ??? 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012
  • 8. Indexes Analysis STRENGTHS (Advantages) Infrastructure: ports and airports Government surplus Life expectancy Buyer sophistication Financial market Soundness of banking system Mobile telephone subscriptions
  • 9. Indexes Analysis (cont.) IMPROVEMENT OPPORTUNITIES (Disadvantages) Judicial independence Quality of roads National savings rate Quality of primary education Internet access in schools Rigidity of employment Domestic market size
  • 10. Panama’s Commitment to Promote Competitiveness and Sustainable Growth 1. Prioritize public investment in sectors where a comparative advantage exists 2. Assure transparency in all government’s actions to safeguard investor’s trust 3. Strengthen the internal market within a safe environment to stimulate the confidence of producers 4. Guarantee a simple and fair distribution of the tax burden, while maintaining competitiveness within sectors 5. Maximize the government’s investment, increase income, establish outlines for public-private participation and diminish the operative expenses. Alberto Vallarino, Minister of Economy and Finance at the 4th National Competitiveness Forum, Panama City , November 2009
  • 11. Economic Sectors Hierarchy and Potential Competitive advantage   Tourism  Social impact (jobs) Logistics Agriculture  Growth Boosters Economic impact on GDP Financial Services  Future Potential Off-shoring services  Maritime services  Private health services  Regional headquarters of multinationals Alberto Vallarino, Minister of Economy and Finance , on the Government s Strategic Plan 2010-2014, November 2009 Government´s capacity to intervene
  • 12. Some Reforms and Actions  Businesses:  Law 34 of 6/5/2008: Social Fiscal Responsibility ○ Requires financial and public investment planning  Law 41 of 8/24/2007: special regime for the establishment and operation of headquarters ○ Drives AEEPP (Howard, a former US Base)  Laws 5 of 01/11/2007 and 31 of 07/22/09: speeds up businesses opening ○ PanamaEmprende  Taxes payments via internet  Energy:  Energy Savings Plan in effect for the public sector  Law frameworks in progress: program to establish the rational and efficient use of energy; Eolic Law and Bio-fuel Law
  • 13. Some Reforms and Actions (cont.)  Infrastructure:  Extension of the Panama-Colon Highway  “Metro” system  Panama Bay’s clean-up  Reorganization of the roads system  Technology and Innovation  Law 59 of 08/11/2008: promotes digital inclusion ○ Universal Internet access ○ “Panama Inteligente” (by 2014): a paperless country (Ejustice; E-exports…)
  • 14. Actions Led by the NCC  National Competitiveness Forum: A public-private encounter to build consensus Status of implementation of the previous year's Action Agenda 57% 59% 56% 57% 38% 31% ○ The “Action Agenda” 29% 23% ○ Implementations follow-up 13% 18% 14% 5% 2st NCF 3rd NCF  In process 4th NCF 5th NCF  Completed  Pending Source: National Competitiveness Center
  • 15. Actions Led by the NCC (cont.)  Monitoring of competitiveness indexes • Thorough analysis • Joint efforts with SEAC • Workshops with local partners  Investigation, analysis and diffusion
  • 16. Final Words… The nation’s competitiveness hinges on the “smart management” of micro and macroeconomic forces, and the willingness of individuals, enterprises, and policymakers to work hand-in-hand to meet shifting challenges. If a country is to reach a sustainable level of development, both government and businesses must move in tandem toward common goals: contributing to the improvement of the quality of life for all citizens, overcoming the barriers of unemployment and poverty, and improving productivity across the board. Competitiveness is not exclusive to a single group or sector; it can be achieved only through a joint effort.
  • 17. Competitiveness is not a destiny, it is a path…
  • 18. NATIONAL COMPETITIVENESS CENTER TOGETHER WE DO IT BETTER! A not-for-profit private organization with a public-private board of trustees www.cncpanama.org Justo Arosemena Ave. and 31st Street Panama City, Republic of Panama (507) 394-4363 or 394-4364