Panama: Investment Grade

Fitch Ratings this week conferred investment-grade status on Panamanian debt, which means Panama can borrow money more cheaply than countries, with lower status.

Investment grade means that the issuer is considered to be a good credit risk, in the opinion of the ratings agency. Investment grade also tends to give a country a positive image among foreign investors.

Panama got the investment-grade rating in large part because of a recently-approved package of tax increases, which promise to increase the health of public finances. The country has also in recent years maintained stronger economic growth than any other Central American country, while investing heavily in infrastructure.

Panama is the only country in the region with investment-grade status. El Salvador lost investment grade in 2009, mainly as a result of a serious decline in remittances from Salvadorans working in the United States.

Opportunities

• Investors
• Bankers
• Borrowers