Caribbean & Central America - November 2015 (ISSN 1741-4458)

Inequality down: On 14 October Panama’s economy and finance minister, Dulcidio de la Guardia, gave a press conference in which he told reporters that for the first time in 23 years, the Gini coefficient that measures income inequality (where 0 is perfect equality and 1 perfect inequality) was below 0.50 last year for Panama for the first time in 23 years, registering 0.49. Pointing to an overall decline in poverty – from 25% (of the population of some 3.99m) in 2014 to 22% in 2015 – De la Guardia said that this downward trend looks to have been maintained this year, registering 0.48 in March 2015.

De la Guardia attributed the improvement to government social programmes like ‘120 a los 65 (120 at 65)’ which was launched by the previous Cambio Democrático government led by former President Ricardo Martinelli (2009-2014) as ‘100 a los 70 (100 at 70)’ which provides a monthly US$100 stipend (since raised to US$120) to pensioners over 70 years of age (since lowered to 65) who are not covered by a pension plan. Other government social programmes include a conditional cash transfer programme ‘Red de Oportunidades’ which benefits some 72,563 people across the country in the form of a US$50 monthly stipend paid out to impoverished families so that their children can go to school and receive basic health and nutrition services. De la Guardia also flagged up the “Beca Universal” (Universal Scholarship) program, which benefits some 500,000 school children across the country in the form of annual scholarships of US$270 for primary education; US$360 for lower secondary school (eduación premedia) and US$450 for secondary education.

At the press conference, De la Guardia cited IMF figures which suggest that Panama is expected to lead Latin America in terms of economic growth in 2015 with projected GDP growth of 6%. According to the latest (October 2015) figures from the United Nations (UN) Economic Commission for Latin America & the Caribbean (Eclac), Panama is expected to grow 5.8% in 2015 (the highest in the region) rising to 6.0% in 2016. This is above the 4.1% and 4.2% average for Central America for 2015 and 2016 respectively. Panama’s GDP grew 6.2% in 2014 on Eclac figures.