Investment grade of Panama at BBB- is reaffirmed by FITCH RATINGS
The risk rating agency Fitch Ratings reaffirms Panama's sovereign rating at BBB- with a stable outlook, maintaining the country's investment grade, reported the Ministry of Economy and Finance (Mef). The country's results are based on high per capita income, the result of a history of strong macroeconomic performance, characterized by high growth rates and relatively low inflation, all backed by the strategic location and asset that is the Panama Canal. The rating agency estimates that Panama will have a Gross Domestic Product (GDP) growth of 9% by 2022, which shows a robust recovery after the contraction suffered by the pandemic.
Source: La Estrella de Panamá
The country's rating was characterized by its high growth rates, low inflation and its asset, the Panama Canal.
Likewise, it highlights that Panama's inflation
levels have remained below the levels of its regional peers and BBB rating
peers. On the other hand, it anticipates that the Government's debt in relation
to GDP will gradually decrease from 63.7% in 2021 to 61.8% this year, driven by
the economic recovery and the decrease in the fiscal deficit. General
Government debt will reach 55.7%, in line with the average for the BBB category
(55.5%). The rating agency projects that growth will return to 4.5% in 2023,
below its previous projection of 5%, due to the expectation of a mild recession
in the United States in mid-2023 and an adverse world economic scenario.