Letter to Santa

As every year I write you my letter of wishes for the Panamanian economy for next year, so that you remember us and keep us as a country with economic growth, but that we can achieve economic development among our fellow citizens.

2020 has been a special year, ever since we started fighting an invisible enemy last march, which has taken the lives of about 3,500 Panamanians and has already infected (at least those who have been tested) more than 200,000 of our fellow citizens. I want to thank you because, despite how irresponsible a part of the Panamanian people is, who only think of parties, we have not had such a regrettable situation (and hopefully we do not get to this).

I thank you for the health of the vast majority of Panamanians, and that this will continue in 2021. But what we also need is to generate a lot of jobs. Unemployment must close at close to 20% (18% by September 2020) by the end of 2020, and I would like to ask you to lower this unemployment to less than 10% by December 2021. This would be a spectacular and feasible achievement for this country.

The lower the unemployment, the fewer problems we will encounter in the country. More money comes into families, there is more demand for products and services, wealth is generated, GDP rises, and the government collects more taxes (without having to raise the % of them as international institutions want to suggest). It's a chain reaction.

You know that unemployment is higher in some sectors than in others, for example, the agriculture sector that can generate a lot of jobs fast, as it is a labor-intensive sector. We have seen the return to the countryside since the pandemic began a lot of Panamanians, which will bear the greatest fruits in the 2021 harvests, recovering the hectares we had lost from planting with previous administrations (one of the few positive points of this administration in its early years of government).

The other is the construction sector, as the sector moves the employment upwards (still the housing construction sector of less $120,000 in Panama City and the construction of houses under $120,000 outside Panama City has a lot of potentials). The new law of Real Estate Leasing can have a good effect in this sector, as it is an excellent opportunity to get a home or premises without having a down payment.

And the commerce sector (which includes retail and wholesale – Colon Free Zone - activities, which also generates thousands of jobs, but for this to happen, we need to generate more demand (in fact I'd like to see new retail investors arrive to increase competition in the country). We need to return to our commercial tourism roots among the countries of the region, especially among tourists who cannot enter the United States and for which Panama would be an excellent alternative.

But Panama has a very interesting transport hub, headed by the Panama Canal, that also moves the port's activities. And the Colon Free Zone, which moves land transport, trucks and trains, and ports. Panama has to keep betting on our geographic location and sell this to the world. The Colon Free Zone and the Panama Pacific Area are two interesting enclaves that have not reached their full potential yet, that is, they still have a lot of room to grow. We have a set of attractive laws – the Multinationals Act (SEM), and EMMA Act (this new law of multinational manufacturing companies can be as effective as SEM, and will generate a lot of employment) - which are essential to achieving potential.

There's one particular issue that now if I'm worried and it's debt. But not because of the amount or the ratio (debt/GDP) we have right now, Panama will recover its GDP and we will be able to pay it back, but Panama should get indebted only to build infrastructure to improve the Panamanian's quality of life, but not to continue the clientelism through the government's operating expenses. Proof of this, it is a 2021 budget of $24 billion, with an increment of 3% over last year (yes, growing rather than being smaller by not having the necessary tax revenue), and this will generate at least about $4 billion in additional debt. What we have to do is to lower the budget to no more than $20 billion, and to borrow as little as possible. If we don't do this, we are at the risk of losing our investment grade, which we got in 2012, and that has enabled the country to place debt at very low-interest rates throughout those years.

In this same topic, I would like to ask you for our government officials to look for more investors, for instance, bringing Panama to Amazon, Alibaba, or JD.com so that they have in the Colon Free Zone the appropriate place to grow in Latin America and the Caribbean, including Colon Airport. With only one of these giants of online sales, we can greatly boost employment and wealth.

And now that the UK has gone out of the European Community Agreement with its Brexit, we must sit down and negotiate a free trade agreement with the Commonwealth, with which we have always had good relations and which represents a bulk of international trade (in addition to serving as an ally against the OCDE, EU, GAFI, etc.).

By 2021 we don't have to worry about inflation. The truth is that with demand remaining lower than in previous years, companies, to be able to sell, they would have to lower prices, and that must be the constant by 2021, however, do not take your eye off the unscrupulous companies who would want to raise prices, under the pretext that there is a lot of demand (cleaning items for example).

I remain of the opinion that Panama's GDP is a consequence of employment, as this is the one that will generate demand for products and services. As long as the employment recovers, more people will have the purchasing power to buy, both necessary items as well the unnecessary ones. And this effect will allow our GDP to return to 2016 levels, at least with a growth of almost 10%.

I am clear that the tourism sector, which also produces a lot of employment, will be somewhat beaten, especially in the first half because the vaccine will not be able to reach the entire population, including most of the world, but that by the time the vaccine reaches the majority, tourism will be a sector that will be able to make a comeback. However, Panama has to do a better job internationally in order to sell ourselves in the markets where we would have demand.

We have to get ahead of ourselves by bombarding the different means of communication that are necessary to be at the top of mind of tourists, those who like to visit exotic countries, and Panama have a lot to offer. Help us to sell Panama, increase demand, and work in this sector that is the one hit the hardest in the economy.

Within the political, I would like to ask you to finish the bad will of them. That is, they need to do something for those citizens in need, and that it's not giving away the fish, but helping them learn how to fish. The people should not be a parasite of the state, but the people need to help the state – paying taxes, being good citizens, helping the needy ones. But it is a mentality that we have both in Panama and many countries of the world, not to say all, that they pretend that it is clientelism that moves the masses, not the honest work and quality of life.

Whether it's turkeys and hams, the block and zinc, the food bag, and the bonus, those "things" should not be the ones that make the people want a politician, but its work helping the majority of the people. Nor that phrases like "he stole, but he did a lot" that is so popular for our country (after one of our past presidents). Fewer politics more good public administration, which should lead us to as small a government as possible, a state that educates the people, a state that gives us a higher quality of life year after year, a state that does not tolerate an increasingly corrupt government, and a fairer state.

Panama still has many good things in it, which we often forget, as we are more aware of the half-empty glass instead of seeing the glass half full. Of course, things can be done better, and they're not doing things as well as the government says, or as bad as other people say. But we have a lot to hold on to for the future with positivism. We need you not to forget us, especially in the very dangerous circumstances we're still in.

May this Christmas, in the celebration of your birthday into the world, continue to give us health and prosperity, a government (whatever it may be) that puts the interests of the people above their own, where goodwill and good deeds reign, and where justice prevails. As every year I write you my letter of wishes for the Panamanian economy for next year, so that you remember us and keep us as a country with economic growth, but that we can achieve economic development among our fellow citizens.

2020 has been a special year, ever since we started fighting an invisible enemy last march, which has taken the lives of about 3,500 Panamanians and has already infected (at least those who have been tested) more than 200,000 of our fellow citizens. I want to thank you because, despite how irresponsible a part of the Panamanian people is, who only think of parties, we have not had such a regrettable situation (and hopefully we do not get to this).

I thank you for the health of the vast majority of Panamanians, and that this will continue in 2021. But what we also need is to generate a lot of jobs. Unemployment must close at close to 20% (18% by September 2020) by the end of 2020, and I would like to ask you to lower this unemployment to less than 10% by December 2021. This would be a spectacular and feasible achievement for this country.

The lower the unemployment, the fewer problems we will encounter in the country. More money comes into families, there is more demand for products and services, wealth is generated, GDP rises, and the government collects more taxes (without having to raise the % of them as international institutions want to suggest). It's a chain reaction.

You know that unemployment is higher in some sectors than others, for example, the agriculture sector that can generate a lot of jobs fast, as it is a labor-intensive sector. We have seen the return to the countryside since the pandemic began of a lot of Panamanians, which will bear the greatest fruits in the 2021 harvests, recovering the hectares we had lost from planting with previous administrations (one of the few positive points of this administration in its early years of government).

The other is the construction sector, as the sector moves the employment upwards (still the housing construction sector of less $120,000 in Panama City and the construction of houses under $120,000 outside Panama City has a lot of potentials). The new law of Real Estate Leasing can have a good effect in this sector, as it is an excellent opportunity to get a home or premises without having a down payment.

And the commerce sector (which includes retail and wholesale – Colon Free Zone - activities, which also generates thousands of jobs, but for this to happen, we need to generate more demand (in fact I'd like to see new retail investors arrive to increase competition in the country). We need to return to our commercial tourism roots among the countries of the region, especially among tourists who cannot enter the United States and for which Panama would be an excellent alternative.

But Panama has a very interesting transport hub, headed by the Panama Canal, that also moves the port's activities. And the Colon Free Zone, which moves land transport, trucks and trains, and ports. Panama has to keep betting on our geographic location and sell this to the world. The Colon Free Zone and the Panama Pacific Area are two interesting enclaves that have not reached their full potential yet, that is, they still have a lot of room to grow. We have a set of attractive laws – the Multinationals Act (SEM), and EMMA Act (this new law of multinational manufacturing companies can be as effective as SEM, and will generate a lot of employment) - which are essential to achieving potential.

There's one particular issue that now if I'm worried and it's debt. But not because of the amount or the ratio (debt/GDP) we have right now, Panama will recover its GDP and we will be able to pay it back, but Panama should get indebted only to build infrastructure to improve the Panamanian's quality of life, but not to continue the clientelism through the government's operating expenses. Proof of this, it is a 2021 budget of $24 billion, with an increment of 3% over last year (yes, growing rather than being smaller by not having the necessary tax revenue), and this will generate at least about $4 billion in additional debt. What we have to do is to lower the budget to no more than $20 billion, and to borrow as little as possible. If we don't do this, we are at the risk of losing our investment grade, which we got in 2012, and that has enabled the country to place debt at very low-interest rates throughout those years.

In this same topic, I would like to ask you for our government officials to look for more investors, for instance, bringing Panama to Amazon, Alibaba, or JD.com so that they have in the Colon Free Zone the appropriate place to grow in Latin America and the Caribbean, including Colon Airport. With only one of these giants of online sales, we can greatly boost employment and wealth.

And now that the UK has gone out of the European Community Agreement with its Brexit, we must sit down and negotiate a free trade agreement with the Commonwealth, with which we have always had good relations and which represents a bulk of international trade (in addition to serving as an ally against the OCDE, EU, GAFI, etc.).

By 2021 we don't have to worry about inflation. The truth is that with demand remaining lower than in previous years, companies, to be able to sell, they would have to lower prices, and that must be the constant by 2021, however, do not take your eye off the unscrupulous companies who would want to raise prices, under the pretext that there is a lot of demand (cleaning items for example).

I remain of the opinion that Panama's GDP is a consequence of employment, as this is the one that will generate demand for products and services. As long as the employment recovers, more people will have the purchasing power to buy, both necessary items as well the unnecessary ones. And this effect will allow our GDP to return to 2016 levels, at least with a growth of almost 10%.

I am clear that the tourism sector, which also produces a lot of employment, will be somewhat beaten, especially in the first half because the vaccine will not be able to reach the entire population, including most of the world, but that by the time the vaccine reaches the majority, tourism will be a sector that will be able to make a comeback. However, Panama has to do a better job internationally in order to sell ourselves in the markets where we would have demand.

We have to get ahead of ourselves by bombarding the different means of communication that are necessary to be at the top of mind of tourists, those who like to visit exotic countries, and Panama have a lot to offer. Help us to sell Panama, increase demand, and work in this sector that is the one hit the hardest in the economy.

Within the political, I would like to ask you to finish the bad will of them. That is, they need to do something for those citizens in need, and that it's not giving away the fish, but helping them learn how to fish. The people should not be a parasite of the state, but the people need to help the state – paying taxes, being good citizens, helping the needy ones. But it is a mentality that we have both in Panama and many countries of the world, not to say all, that they pretend that it is clientelism that moves the masses, not the honest work and quality of life.

Whether it's turkeys and hams, the block and zinc, the food bag, and the bonus, those "things" should not be the ones that make the people want a politician, but its work helping the majority of the people. Nor that phrases like "he stole, but he did a lot" that is so popular for our country (after one of our past presidents). Fewer politics more good public administration, which should lead us to as small a government as possible, a state that educates the people, a state that gives us a higher quality of life year after year, a state that does not tolerate an increasingly corrupt government, and a fairer state.

Panama still has many good things in it, which we often forget, as we are more aware of the half-empty glass instead of seeing the glass half full. Of course, things can be done better, and they're not doing things as well as the government says, or as bad as other people say. But we have a lot to hold on to for the future with positivism. We need you not to forget us, especially in the very dangerous circumstances we're still in.

May this Christmas, in the celebration of your birthday into the world, continue to give us health and prosperity, a government (whatever it may be) that puts the interests of the people above their own, where goodwill and good deeds reign, and where justice prevails.