Weak Global Economy Hits Logistical Activities in Panama

Note: this is just a translation of a news article appearing in La Estrella de Panama newspaper in Panama on 18 August 2016. The article is authored by Mirta Rodriguez P. and is the property of La Estrella de Panama. The British Chamber of Commerce in Panama does not claim ownership of the contents of the article, just the translation presented below.

 

The ports, Panama Canal and the Colon Free Zone were affected, according to a report by the Comptroller General


The weak global economy is severely impacting the results of economic activity in the logistics and transport sector in Panama, figures from the Comptroller General of Panama reveal.

Ports

Official figures show that in the first semester of 2016, the movement of containers in the National Port System (NPS) decreased 12.8% and cargo movement reduced by 17.8%.

Previous results of the first five months of the year showed that the movement of containers had reduced in all of the Panamanian ports.

Colon Container Terminal, Manzanillo International Terminal, Panama Port Balboa, Panama Port Cristobal, PSA and Bocas Fruit are the ports that form part of the NPS.

Panama Canal

In the first semester of 2016 all Panama Canal activities indicators showed negative results. The transit of ships through the main inter-oceanic route decreased by 6%. Along the same lines, the transit of ships of high depth went down by 5.5% y the transit of ships of shallow depth fell by 2.9%.

Other indicators of the Panama Canal impacted by the international situation were income from tolls, which dropped by 4.5%, the net tonnage transported fell by 4.4%, and the volume of cargo, which fell 13.7%.

It is hoped that the outcome gets better in the coming months, with the start of operations of the Panama Canal expansion project.

Colon Free Zone

In the case of the Colon Free Zone, figures reveal that in the first semester of 2016, the total trade in the main free economic zone of the country dropped by 13.3%. In detail, the results from the Comptroller General show a decrease in 15.4% in imports and a decrease of 11.2% in re-exports from the CFZ.

Global Outlook

According to the latest report of the International Monetary Fund (IMF), the recovery of the global economy will continue at a slower and more fragile rate. “In the last few months a new episode of volatility has been registered in the global stock market, growth has lost some impulse in the advanced economies, and emerging economies and countries will low income continue facing challenges,” it shows.

Additionally, the IMF indicates, “several conflicts with no economic origin threaten economic activity. These factors not only lead to revising once more the depression and in general its projections of economic growth in 2016 and 2017, but also leads to thinking that results that can come up from other scenarios are at the same time less favourable and more probable.

The base projection of global growth in 2016 is a modest 3.2%, according to the IMF. The organisation bets that recovery will take hold in 2017, driven by nothing more than the economies of emerging and developing markets, following the onset of gradual normalisation of conditions in economies under strain.

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