Weak Outlook For Global Tourism Will Widen Panama's Current Account Deficit In 2020 And 2021

• Fitch Solutions has revised its forecast for Panama’s current account deficit to 9.0% of GDP in 2020 and 6.1% in 2021, up from 5.9% and 5.5% respectively, as a sharp reduction in tourism weighs on Panama’s service trade balance.
• Panama’s goods trade deficit will contract modestly in 2020 amid lower consumer incomes and trade volumes, though it is expected that the deficit will expand in 2021 as economic activity normalizes.
• Robust investor demand for Panamanian assets and a business-friendly economic environment will support Panama’s external account stability despite the wider current account shortfalls.

(Source: Fitch Solutions)