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Multi-dimensional Review of Panama

Volume 2: In-depth Analysis and Recommendations

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Panama has achieved socio-economic improvements in recent decades thanks to strong economic growth and consequent poverty reduction. Its growth model is characterised by a dual economy in which a small number of activities, including those related to the Canal and Special Economic Zones, have exhibited high productivity growth but limited job creation.

Panama should now embark on a new reform agenda to become a sustainable and inclusive high-income country. This report urges greater productivity in sectors that contribute to job formalisation to reduce disparities in income and among regions. As developing these policies requires further resources, taxation system and private sector involvement through public-private partnerships should also be reinforced. Focusing on skills and jobs, regional development and development financing, the volume provides analysis and recommendations on three areas which are key for Panama.

English

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Overview: Towards a sustainable and inclusive high-income country

OECD Development Centre

After nearly three decades of strong macroeconomic performance and some social improvements, Panama should now embark on a new reform agenda to become a sustainable and inclusive high-income country. This chapter highlights the socio-economic improvements Panama has achieved in recent decades thanks to strong economic growth and consequent poverty reduction. Its growth model is characterised by a dual economy in which a small number of activities, including those related to the Canal and Special Economic Zones (SEZs), have exhibited high productivity growth but limited job creation. This chapter therefore urges greater productivity in sectors that contribute to job formalisation to reduce disparities in income and among regions. As developing these policies requires further resources, taxation system improvements and greater mobilisation of private sector investment through public-private partnerships are needed. This chapter presents the main results of implementing policy actions in the three areas studied in this report: skills and jobs, regional development, and development financing.

English

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