Economics on Wednesday

2020 has been a difficult year for everybody, where we had to adapt to many things by trying to save our lives and to survive economically. But the COVID 19 pandemic has resulted in an unprecedented global economic crisis. But not a crisis that is the result of some kind of financial problem or "screw-up" or the speculation of the unscrupulous, but it is a crisis that provokes a pandemic that has kept us – more or less time – within some kind of quarantine. Now, this does not mean that all businesses or independents workers were affected, many survived by doing what is necessary to survive, while other businesses located niches to be in, other businesses flourished, and delivery became the standard of the post-COVID 19 world. This article I write at the beginning of all new year's is meant to give you an idea of where we could invest in this year, based on the opportunities, laws, demand, that exists at any given time, and that we could take advantage of. This year is s...

Although there is still uncertainty about 2021, basically because of the resulting problems from COVID regrowth not only in Panama but in the rest of the world, and even though we do not yet have a date for vaccination to begin in our country (they have just announced that the first 40,000 doses arrive in 2 or 3 weeks), I always stay positive, I think that in this country, we can turn the bad situations around, and we can get our economy moving forward quickly. After my forecast for the end of 2020 where I see a decline in GDP by order of 20%, unemployment of 18%, and inflation of -1%, 2021 may bring us a fundamental change in our main macroeconomic figures after a year of recession, but it did not get to become stagflation. My forecast for 2021 leads us to GDP growth in the order of 10%, unemployment of 10% thinking that the vaccine will arrive in the first quarter, and by the second half, we could be able to vaccinate the whole population (at least the vast majority of the 3 millio...

2020 has proven to be a very special year. Some will say that it was a year to forget, others will be able to say that it was a year when we learned a lot, others that the Panamanian does not learn anything and will always stumbles upon the same stone, in short everyone can have his own opinion on it, but it was definitely a different year. I will try to outline a small summary of what happened to us and talk about the GDP figures for the 3Q that came out last week, and how little has been said about unemployment according to a telephone survey that INEC (National Institute of Statistics and Census) did instead of the face-to-face survey they normally do in different pre-selected houses. The year had started slower than in 2019, in fact when we look at the GDP figures for the first quarter, even though we had grown, it was less than 1% (0.3% to be more accurate in nominal GDP and 0.4% in real GDP), compared to the first quarter of 2019. And when compared to the fourth quarter of 2019...

A s 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 ...

The water market isn't something new, what is new is to market water in financial markets, just as crude oil and gold are traded. Panama is a country with a lot of freshwaters, we have more than 2,000 km of coastlines in the country, in the Pacific Ocean and the Caribbean Sea, plus that of the islands. Besides, we have lots of rivers of all sizes and flow, throughout the country, some stronger than others.   But when it rains, even the meekest and small creek becomes a danger to those who live in its surroundings. We have abused our rivers in many ways, dumped them with garbage, turned them into sewage, and even throwing them with industrial waste dumps, and with this, we pollute our oceans, without anyone doing anything about it. We have filled them with hydroelectrics - mirrors, and pass-through types - but we are not able to make the water reserves for the dry season of the year. If we go back to ancient history, not all cities were settled near the sea or a river, and someh...

We have written a lot about the private sector and its role as an engine of the economy, although governments often tend to forget this and pretend that the state will bear the economic growth, obviously inefficiently, which puts unnecessary weight on public finances and then on taxes. Even though I am convinced that the government has to be as small as possible, it is easier to say it than to do so, especially under the current circumstances, but if there is a will, this can be done. The government should focus on alleviating the life of the private sector so that they could be able to grow and generate taxes and create more jobs. Employment generates tax revenues for both staff and businesses. And when there is employment, the wealth of the nation grows, and therefore the wealth of all citizens. The government wanted to bring wealth to those most in need. In the case of Panama it is done through a large number of subsidies, none of them with an expiration date, unfortunately. Besid...

The Pandemic has brought us many forums through Zoom, with easy accessibility, where many of us have been able to learn new things, learn things we didn't have time to find out before, and attend as many webinars and meetings as humanly possible. We've learned in many cases, in others not so much. We've agreed on many topics, but not on others. In my case in particular, I have a serious problem with most of the recommendations of IDB, World Bank, IMF, GAFI, OECD, EU, UNESCO, UN, and any global/international/regional organization that tries to comment on our country (or any other), without actually knowing it. If there is one thing that is true in our country, it is that its economy is a hybrid, it does not behave the same as that of developed countries, since it has many peculiarities, which are generally forgotten by many experts. One of the most important is that since 1845 the US$ circulates in our country unofficially with the entry of the Americans who crossed our ...