(PanamaAmerica) Panama’s economy has been growing in recent years at a rate much faster than its neighbors, but this boom is not reflected in the income of the working class, warned the Panamanian economist Rubén Lachman.
“We are in a country that is growing, but definitely the incomes of workers are not growing at the same rate as that of the entrepreneurs,” said Lachman, president of consulting firm Intracorp during the presentation of the conference “Economic Outlook Panama 2010-2011 “. He explained that a survey conducted by his company of Panama’s economy between 2004 and 2008 showed that the gross earnings of entrepreneurs in the country grew from about 5,600 to 10,000 million dollars, while compensation of employees in the same period went from about 5,000 to 6,000 million dollars. “What we have to do is how to increase salaries of employees and not punished in any way with tax increases,” which may cause a fall in consumption, he said.
To do this – Lachman said, must be a rearrangement in the public policy of the Panamanian economy, so that it knows which domestic production sectors relate to the most successful of the external economy and this will lead to the development of synergy make sustainable growth. “Panama’s economy is to explore a bit (because) we take for a fact that is consistent in how it works and this is false because it operates according to a particular form of organization where not all economic activities are capitalists ( …) but become part of an area known as informal, “he said.
In that sense, Lachman said that even countries with growing economies are exempted from the informal sector, which can generate up to one third of gross domestic product (GDP) of a country. He cited as example that in Panama, while in 2001 GDP growth was 0.6%, the informal sector accounted for 39% in 2008, an increase of 10.7% of the economy, just dropped to 38 informal %. He said that in economics there is a basic rule which states that the extent to which an economy is taking income, you can go charging or rewarding the regulations of this economy.
“But if we go overboard in restrictions, taxes, may be that the economy’s total revenues decline,” because they charge so much tax you start to punish the population and when this happens, there may be negative measures such as is tax evasion or smuggling, said the economist.
Finally, said the Panamanian economy has winners in the short, medium and even long term, especially those having to do with exports, specifically those that make up the cluster of world trade (the Panama Canal, rail, telecommunications, ports), the activity of foreign residents and tourism.
But these sectors must go hand in hand with appropriate policies in sectors that offer goods and general services, for these actors in turn generate multipliers that generate income in the population.
. Lachman said this happens “in a context of economic growth, no doubt, but we must analyze fiscal policies do not end up killing the goose that lays the golden eggs.”