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Caribbean & Central America - February 2020

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ECONOMIC HIGHLIGHTS

PANAMA | Panama Canal water shortages. On 13 January the Panama Canal Authority (ACP) issued a statement highlighting new efforts to conserve water flowing through the Panama Canal after 2019 marked the fifth driest year seven decades. The new measures, which were due to take effect on 15 February, include a freshwater surcharge on vessels over 125 feet, adjustments to the booking system for all shipments, and a vessel handling fee. According to the ACP statement, these measures were necessary “to sustain an operational level of water and provide reliability to customers while it implements a long-term solution to water”. A 6 January ACP press release noted that rainfall in 2019 was 20% less than the country’s historic average, while water evaporation levels increased by 10% due to a 0.5- to 1.5-degree Celsius rise in temperature. As a result, Gatún Lake, the main source of water for the Canal and local communities, has lower water levels than average for this time of year. Low precipitation levels generate the risk that the lake will not have enough water to sustain canal operations during Panama’s dry season. The new measures join a series of ongoing water conservation initiatives that ACP officials have been implementing to address water sustainability. These include suspension of energy generation at the Gatún hydroelectric plant, elimination of hydraulic assistance at the Panamax Locks, which use high levels of water to ease vessel passage, use of water-saving basins at the Neopanamax Locks, and use of tandem lockages, which allow two vessels to pass the canal at the same time.

Central America & Caribbean:​ Inflation
Monthly year-on-year figures

 

Central America & Caribbean: GDP growth (%)
Quarterly figures are year-on-year growth
GDP  end 2019* 2020 forecast* Q4 2018 Q1 2019 Q2 2019 Q3 2019
Costa Rica 1.8 1.9 1.9 1.8 1.4 1.9
Dominican Republic 4.8 4.7 6.6 5.7 3.7 4.8
El Salvador 2.2 2.3 2.1 1.8 2.0 2.7
Guatemala 3.3 3.2 3.5 3.0 3.5 4.0
Honduras 2.9 2.9 4.8 3.5 1.9 2.4
Nicaragua -5.3 -1.4 -7.7 Not yet available  Not yet available  Not yet available
Panama 3.5 3.8 4.0 3.1 2.9 2.7
*Figures from the United Nations Economic Commission for Latin America & Caribbean Dec 2019
Quarterly growth based on figures from the local central banks