Economic growth matters, but it is just one facet of development. Policy makers should focus their attention on ensuring that their country’s development path is sustainable and that the lives of their citizens improve. This requires reconciling economic, social and environmental objectives.

OECD Development Pathways is a series that looks at multiple development objectives beyond an exclusive focus on growth. It recognises well-being as part and parcel of development and helps governments identify the main constraints to more equitable and sustainable growth by undertaking a multi-dimensional country review (MDCR). Governments trying to achieve economic, social and environmental objectives need to understand the constraints they face and develop comprehensive and well sequenced strategies for reform that take into account the complementarities and trade-offs across policies. The MDCR methodology is based on quantitative economic analysis, as well as qualitative approaches including foresight and participatory workshops that involve actors from the private and public sectors, civil society, and academia.

The MDCRs are composed of three distinct phases: initial assessment, in-depth analysis and recommendations, and implementation of reforms in the identified key areas. This approach allows for a progressive learning process about the country’s specific challenges and opportunities that culminates in a final synthesis report to inform reforms in the country.

The MDCR of Panama is the third review, following that of Peru and Uruguay, to be undertaken by the OECD in Latin America. The MDCR of Panama – Volume 1, Initial Assessment was launched in October 2017. This second volume, In-depth Analysis and Recommendations, focuses on three key constraints for inclusive development in Panama, namely skills and formal jobs, regional development and financing for development.

This MDCR is designed to help Panama formulate development strategies, and identify and support the policy reforms needed to achieve further sustainable and inclusive development. This review comes at a time when Panama is achieving high economic growth but further policy action is needed to expand socio-economic benefits across all economic sectors, regions and households. A forthcoming volume, based on the recommendations presented in this second volume, will present the necessary conditions and actions for making reform happen. These analyses support Panama’s own development agenda towards achieving a brighter future for its citizens.