Panama to Grow 3.9% in 2026 Amidst Regional Economic Slowdown

Posted on 2026-04-23

The World Bank’s latest report projects that Latin America and the Caribbean will grow by only 2.1% in 2026, down from 2.4% in 2025. This slowdown is driven by high financing costs, weak external demand, and global uncertainty. In this challenging landscape, Panama stands out with a projected growth of 3.9%, significantly outperforming the regional average.

Susana Cordeiro Guerra, World Bank Vice President for the region, noted that performance could improve if nations succeed in reactivating investment and boosting productivity through institutional strength. Meanwhile, Chief Economist William Maloney cautioned that while Panama’s performance remains robust, debt sustainability and inflation management remain key areas of concern in a demanding global environment.

Panama’s Minister of Economy and Finance, Felipe Chapman, explained that rising oil prices have a mixed impact: while domestic fuel costs rise, the Panama Canal becomes more competitive against longer alternative routes. However, Chapman remains cautious regarding a potential slowdown in global trade and the influence of international interest rates on the cost of capital.