The World Bank strategy in Panama for the 2024-2028 period

The new 2024-2028 Country Partnership Framework (CPF) with the Republic of Panama aims at working three different areas, with a long-term focus on economy growth and people's well-being.

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Labor-market constraints have prevented certain groups from fully benefitting from Panama's recent growth. 50% of the labor force is employed informally in low-quality jobs in low productivity sectors. MSMEs (Medium and Small Enterprises) represent an estimated 95.7% of all firms in Panama, yet 61% of small business report having limited access to credit, which might help explain why small firms have experienced minimal productivity gains over time. The first desired outcome of this plan is to promote the creation of high-quality and inclusive jobs by enhancing access to finance for MSMEs; exploring alternative sources of growth in sectors with untapped potential such as sustainable tourism, forestry management and agri business; and explore opportunities for private capital mobilization for big infrastructure projects that could create jobs.

A child born in the country today will achieve only 50 percent of her potential lifetime productivity (Human Capital Index). Students in Panama learn less than their counterparts in other countries, with 70% of 15-year-olds failing to reach the basic-level proficiency in reading, math, and science. Therefore, the second outcome of this plan aims to strengthen and promote inclusive human capital development in Panama by improving access to and quality of health, education and water services, with a focus on modernize health systems and safety nets and improve public service delivery in underserved areas, such as indigenous territories.

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Finally, Panama ranks 14th among the countries most exposed to multiple impacts from climate change. The third desired outcome for the CPF is to adapt to and mitigate climate change impacts on the economy and on the population, as well as buttressing Panama's contribution to the international climate change agenda. The WBG will support this objective by promoting enhanced climate smart interventions to implement the Energy Transition Agenda for 2020-30, energy efficiency measures, adoption of biodiversity-friendly farming and land-use practices in rural areas, forest conservation and restoration, and protection of coastal ecosystems and oceans. Strengthening the institutional framework and technical capacities for disaster risk management (DRM) will also be key.

The framework puts a special focus on strengthening public institutions and creating opportunities for women, indigenous groups, Afro-Panamanians, and other vulnerable populations. We are committed to working with the Republic of Panama to close gaps and drive balanced growth without leaving no one behind.