Boston, MA -- (ReleaseWire) -- 11/15/2012 -- BMI maintains its positive outlook toward Panama's growth outlook, forecasting real GDP growth of 8.1% in 2012 and 7.3% in 2013, as a result of continued robust private consumption. That said, we caution that with the completion of the Panama Canal nearing, the previous steady stream of investment may become somewhat less stable until the country is able to ensure more diversified investment opportunities.
Despite rising global headwinds in 2011, Panama's real GDP growth surprised to the upside at 10.6%, bolstered by strong commercial and construction sector activity. Panama remains a regional growth outperformer and we expect this trend to continue in coming years.
The Panama Canal remains a guaranteed source of income and freight volumes for the country and it will provide a further boost to trade and earnings in 2015, when the ongoing US$5bn expansion project is completed. The ratification by the US congress of the Panama Free Trade Agreement (FTA) is also excellent news for freight transport volumes, as it will certainly boost trade between the two countries.
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Key Industry Data
- Air freight tonnes are set to grow by 5.3% in 2012, to 120,000 tonnes. BMI forecasts average annual growth of 4.6% over the medium term.
- Total tonnage throughput at Balboa is expected to grow by 5.8% in 2012. We forecast average annual growth of 6.9% over the medium term.
- Total tonnage throughput at Manzanillo is forecast to grow by 3.0% in 2012. We forecast average annual growth of 3.8% over the medium term.
Panama Approves New Colon Container Terminal
Panama is to construct a fourth container terminal in Colon at the Atlantic entrance to the canal. The US$600mn terminal, which is designed to have an annual capacity of 2 million 20-foot equivalent units (TEUs), will be built by a consortium of private Asian developers called the Panama Colon Container Port (PCCP), with Jones Lang LaSalle acting as development adviser.
Panama Canal Proposes Toll Hikes
BMI's view that the cost of using the Panama Canal will continue to rise as the expansion project continues is playing out, with the Panama Canal Authority board of directors approving a proposal to raise tolls on multiple vessel types, including container ships, in stages over the next two summers.
Panama Canal Completes Building First Pacific Lock Section
The contracting group that is building the new set of locks at the Panama Canal completed the first monolith of the new locks on the Pacific end of the canal. The monolith is the first of 46 such structures to be completed in the upper chamber of the Pacific locks.
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