Martinelli Describes Panama As Having No Unemployment and No Financial Crisis

Martinelli Describes Panama As Having No Unemployment and No Financial Crisis

Tuesday, May 03 2011 @ 07:37 PM EDT
Contributed by: Don Winner
Views: 86
President Ricardo Martinelli described Panama as a country with no unemployment and no financial crisis in an interview he gave to CNN in Spanish which was released today, Tuesday, 3 May 2011 by the local media. In his statements Martinelli also noted there are many professions and skills required for jobs and there are no Panamanians qualified to fill them. On this last point, private sector organizations have warned that they require qualified personnel and it’s hard to find them. What’s more, a local study earlier this year indicated there are companies seeking bilingual accountants and financiers, administrative assistants, sales managers, engineers, laborers, mechanics and customer service representatives, and that these people are simply not available.
Martinelli’s statements contrast with unemployment statistics from the office of the Comptroller, which according to their report from August 2010 the total unemployment in the country is 6.5%, only 0.1 percentage points below that recorded in the same period in 2009, when the rate was 6.6%. The secretary general of the General Confederation of Workers of Panama, Mariano Mena, rejected Martinelli’s claims. He said that Martinelli lives in another country, and that in Panama there is unemployment and the percentage is even higher than what the official figures show. As an argument Mena reiterated an objection often presented by the trade unions, regarding how to measure the rate of unemployment in the country, since it is done by asking the person if in the last three months they have looked for work. “This is not correct, because selling cane is not the same as having a job with social benefits,” he said.

On the other hand, Martinelli told CNN that banking and the real estate industry in Panama is very strong, and stressed that this year the country will receive 2 million tourists. “In Panama we don’t have any bad loans; in Panama there is construction, financing, it’s paid for and then sold, and there is no crisis,” stressed the President of Panama. Between 2011 and 2014 an avalanche of infrastructure projects is expected in both the private and public sectors, which will involve a total investment of $14 billion dollars. The Panama Canal expansion, construction of the Metro and the road realignment are some of the most important. (La Prensa)

Editor’s Comment: I personally think the actual unemployment numbers are much less than the last officially reported number of 6.5% – in fact I don’t think the government of Panama has the means or capability to accurately produce good statistics on unemployment in this country. The fact of the matter is that the economy has been growing steadily for going on seven years straight, and a growing economy produces more jobs. And the economy is Panama is not just growing, but rather it’s growing at a clip that is out pacing most of the other countries in Latin America. It just stands to reason that eventually the rate of job creation will eventually surpass the capabilities of the population to produce new workers to fill those positions. Like – if you need a bilingual customer service person to man the front desk of a five star hotel, you better be prepared to pay. Need an underwater welder? Good luck finding those guys, or at least someone with more than thirty seconds of experience. Sometimes even dealing with success can create headaches. More jobs and declining unemployment usually translates into higher pay, and then inflation (because companies have to charge more to cover their increasing labor costs.) Push here, bulge there – always happens in economics. Eventually, in our lifetimes, Panamanians will be the richest people in Latin America in terms of GDP per capita (PPP). It’s going to happen, and there’s not much that can prevent it from happening. For 2010 Panama is ranked by the International Monetary Fund (IMF) at $12,578 and 67th in the world. The World Bank (2009) ranks Panama at $13,057 and 58th in the world. The CIA Fact Book ranks Panama as $12,700 (2010 est.) and 71st in the world. If you average those three figures you get a GDP per Capita (PPP) of $12,779 – and above Panama some of the other countries of Latin America are Argentina at $14,538, Mexico at $14,335, Chile at $14,331, and Uruguay at $13,189. And that’s it. In the year 2000 when the US finally pulled out of Panama and handed over the Panama Canal, Panama’s GDP per Capita (PPP) was about $3,938 – or an increase of 224% in just ten years. That is an astounding rate of growth. An obviously an economy that is growing so much will produce a whole lot of new jobs. Sooner or later Panama is going to have to relax the rules regarding foreign workers, which were put in place at times of a depressed economy and massive unemployment. Thankfully, those days are long gone.

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