PANAMA, May 28, 2011 - Panama’s economic performance has been impressive during the past five years, averaging a GDP growth of 8 percent. And while this high growth rate is projected to continue above 7 percent in 2011 and 2012, the Government of Panama is making strides towards addressing the challenges of improving transparency, strengthening the efficiency of the public sector and promoting opportunities for all Panamanians.
World Bank Managing Director Sri Mulyani Indrawati visited Panama on May 26-27 to discuss the Bank’s support to the country’s development agenda, while learning firsthand about its progress and challenges.
While praising President Ricardo Martinelli for the country’s economic prosperity, Indrawati also wondered about ways to maintain such momentum and address the many challenges that come with it. Options discussed included expanding and strengthening social programs and attending the rapid demand for more transportation, electricity and water infrastructure.
Indrawati reiterated the Bank’s commitment to supporting the Government's efforts to reduce inequality, improve transparency and consolidate the economic growth. Currently, World Bank financial and technical assistance to Panama includes eight projects focusing on health, social protection, rural development, environment, infrastructure and efficiency in the public sector, for a total of US$336.4 million.
The International Financial Corporation (IFC), the Bank’s private sector arm, is supporting Panama’s finance and infrastructure sectors by expanding the availability of microfinance and insurance, increasing clean energy production and supporting the expansion of the Panama Canal, with an investment portfolio of US$ 457.9 million.
Indrawati and Panamanian authorities also discussed regional security concerns.
“The problem of security, organized crime and drug trafficking is costing the Central American economy up to 8 percent of its GDP; and because of the nature of this problem the regional cooperation is very important. The World Bank is going to support any regional initiative in order to address this issue,” said Indrawati.
To learn more about Panama’s advances in the modernization of the public sector and increased transparency and efficiency of public procurement, a process that has received World Bank support, Indrawati visited the offices of the e-procurement platform Panama-Compra.
Since its creation in 2006, Panama-Compra has registered more than 460,000 public procurement acts for a total of more than US$8 billion in bids. This e-procurement platform for government purchases and the introduction of Framework Agreements have substantially increased the efficiency of procurement by public entities.
Indrawati also met with the Minister of Economy and Finance, Alberto Vallarino, to discuss among other topics the Enhanced Public Sector Efficiency technical assistance project, recently approved by the World Bank Board. This new operation will assist public agencies in producing, using and disseminating timely and quality performance information, thereby allowing a more efficient, transparent and account use of Panama's public budget funds.
In order to become more familiar with the Panama Canal and its expansion, Indrawati also met with Alberto Alemán Zubieta, Administrator of the Panama Canal Authority, Francisco Miguez, Executive Vice President of the Panama Canal Authority, and Liriola Pitti, Reverted Areas Administrator.
Discussions centered on the notion of Panama becoming a new global trade and logistics center and the challenges for more institutional capacity and coordination.
Indrawati also got the chance to observe the operations of the Panama Canal at the Miraflores Locks, while getting a glance of the US$5.25 billion expansion project, which is underway and receives financial support from the World Bank Group.