Panama Finance Minister: "Moody's Upgrade Reflects Panama's Commitment to Economic Performance and Fiscal Responsibility"

PANAMA CITY, Oct. 3, 2017 /PRNewswire/ -- Panama's Minister of Economy and Finance, Dulcidio De La Guardia, responded to Moody's Investor Service upgrading its outlook on Panama from stable to positive, noting that, "This is yet another recognition by the international business and investment community of the Government of Panama's continued success in improving our economic performance and fiscal responsibility that has been in place since day one of the Varela Administration taking office." 

In addition to upgrading its outlook, Moody's also affirmed the Government of Panama's issuer rating and senior unsecured bonds at Baa2 and senior unsecured shelf at (P)Baa2.

According to Moody's, the key drivers behind the change in outlook are Panama's strong GDP growth, which continues to outperform its peers, and Moody's expectation that the debt trend will improve over the coming years supported by fiscal consolidation and compliance with fiscal standards.

The rating agency highlighted the actions taken by the Varela Administration to improve the debt trend, noting that, "The current government has reduced the deficit of the non-financial public sector, the relevant government level for the fiscal rule targets, since it took office to 1.9% in 2016 from 3.2% in 2014." 

Moody's also highlighted Panama's economic performance, investment driven growth, and its investment ratio which amounted to 45% in the past five years. "Given prospects for continued and robust infrastructure spending, we expect capital accumulation and productivity gains will support Panama's high potential growth, which we estimate at 5.5%," Moody's stated.

SOURCE Panama Ministry of Economy and Finance