• Analysis and Studies
• Panama: a look at the market

Panama, located at the crossroads of North and South America, is most known for the Panama Canal, which connects the Atlantic and Pacific Oceans, playing a crucial role in global trade. The canal, completed in 1914 and fully controlled by Panama since 1999, has made the country a key hub for international shipping.

Historically, Panama was a Spanish colony before gaining independence in 1821, after which it joined Gran Colombia but separated in 1903 with the United States backing to facilitate the construction of the Panama Canal. In the 20th century, Panama experienced political turmoil, including a period of military rule under Manuel Noriega, who was removed from power during an invasion of the United States in 1989. Today, Panama is a stable democracy with a growing economy, driven largely by services related to the canal, banking, and tourism.

Panama's culture is a blend of indigenous (Kunas, Emberás, and Ngöbe-Buglés), African, and Spanish influences, with vibrant music, dance, and festivals playing a central role. The country is also known for its biodiversity, with national parks and reserves protecting its rich flora and fauna.

The flag consists of four equal rectangles: on the top there are a white rectangle, featuring a blue five-pointed star at its center, and a plain red rectangle, whereas on the bottom up we find a blue rectangle and a white rectangle with a red five-pointed star in the center. The blue and red represent the colors of the primary political parties, with blue symbolizing the Conservatives and red the Liberals, while the white stands for peace between them. The blue star represents the civic ideals of purity and honesty, and the red star symbolizes authority and law.

Panama has a high level of specialization in Copper Ore ($2.94B), Scrap Vessels ($46.6M), Bananas ($191M), Passenger and Cargo Ships ($691M), and Special Purpose Ships ($195M).

In 2022, Panama was the 119^th in total exports, with a trade of $6.62B, and the 59^th in total imports, with a trade of $55B.

In 2022 the most exported product was Copper Ore, with a trade of $2.94B, ahead of Passenger and Cargo Ships ($691M), Special Purpose Ships ($195M), Bananas ($191M), and Refined Petroleum ($179M), exporting mostly to China (17.2%), Japan (11.9%), South Korea (8.15%), United States (5.4%), and Spain (4.63%).

Panama's exports are heavily driven by copper ore, making up nearly half of its total exports, with China, Japan, and South Korea being the largest buyers. The country also plays a vital role in the maritime industry, exporting ships primarily to South Korea, Japan, and Denmark, underscoring its importance as a shipping hub.

Beyond these sectors, Panama’s agricultural exports, particularly bananas, are directed mainly to Europe, with the Netherlands as a key market, while refined petroleum is sold within Latin America. The economy’s heavy dependence on copper makes it vulnerable to price fluctuations, but its diversified trading relationships with both global and regional partners provide economic resilience.

1. Copper ore (44.4%): 37% China, 21.3% Japan, 7.91% South Korea, 7.48% Spain, 7.27% India, 5.98% Bulgaria, 4.62% Canada, 4.41% Germany
2. Passenger and Cargo Ships (10.4%): 31.5% South Korea, 18.9% Japan, 18.9% Denmark, 10.1% Germany, 8.13% Poland, 6.8% Italy, 2.37% India
3. Special Purpose Ships (2.94%): 100% Thailand
4. Bananas (2.88%): 28.1% Netherlands, 12.8% Germany, 11.4% United Kingdom, 11.3% United States, 7.22% Finland, 5.2% Poland, 2.47% Canada, 1.13% Spain
5. Refined Petroleum (2.7%): 29% Guatemala, 15.7% Colombia, 11% Nicaragua, 10.5% Chile, 8.57% Ecuador, 4.36% Jamaica, 1.8% South Africa

Whereas the most imported product was Crude Petroleum, with a trade of $16.1B, followed by Refined Petroleum ($11.7B), Passenger and Cargo Ships ($5.4B), Packaged Medicaments ($819M), and Cars ($786M), importing mostly from China (20.4%), United States (19.6%), Guyana (10.6%), Colombia (10.6%), and Ecuador (9.04%).

The graphic reveals a significant dependence on energy products, with crude and refined petroleum accounting for a large portion of the total imports, mainly sourced from Guyana, Colombia, and the United States: this reliance highlights the country's close ties to regional suppliers for energy needs.

Panama also plays a crucial role in global maritime trade, importing passenger and cargo ships primarily from Japan and China. Additionally, imports of packaged medicaments and cars illustrate a diverse range of suppliers, including Germany, Mexico, and Japan. While this heavy reliance on petroleum imports exposes Panama to potential price volatility, the variety of its trade partnerships indicates a well-integrated economy within both regional and international markets.

1. Crude Petroleum (3%): 36.2% Guyana. 32.4% Colombia, 24.9% Ecuador, 4.23% United States
2. Refined Petroleum (21.3%): 52.7% United States, 22.6% China, 7.5% Ecuador, 4% Brazil, 3.81% Peru, 1.63% Canada, 1.49% Colombia, 1.17% Greece
3. Passenger and Cargo Ships (9.82%): 51.5% Japan, 32.5% China, 9.67% South Korea, 2.98% Denmark
4. Packaged Medicaments (1.49%): 12.4% Germany, 12.3% Mexico, 10.3% United States, 8.66% Belgium, 5.61% France, 4.81% Switzerland, 4.52% Colombia, 4.49% Guatemala, 4.21% Spain, 3.12% Brazil
5. Cars (1.43%): 16.4% Japan, 13.1% United States, 9.53% China, 9.38% Argentina, 9.22% India, 8.07% South Korea, 6.03% Mexico, 5.5% Brazil, 2.94% Germany, 1.05% Belgium

Between 2021 and 2022 the exporter which had the fastest growth was Denmark, with an increase of $118M, followed by South Korea ($117M) and Canada ($87.4M).

1. Denmark: from $20.4M to $138M
2. South Korea: from $422M to $539M
3. Canada: from $62.3M to $150M

Whereas the fastest growing importer was Guyana, with an increase of $5.02B, ahead of the United States ($4.05B) and Colombia ($3.44B).

1. Guyana: from $829M to $5.84B
2. United States: from $6.72B to $10.8B
3. Colombia: from $2.4B to $5.84B

Sources: 

https://oec.world/en

https://www.cia.gov/the-world-factbook/countries/