Construction slows down in April

06-18-2009 | MANUEL LUNA

Investments fell to $96.8 millions, the lowest amount in the last five years

Panama Star PANAMA. Investment in the construction industry registered a fall of 25. 3 percent in April in comparison with March figures, says the Panama’s Comptroller Office. April investments amounted to $96. 8 millions, the lowest amount registered in the last five years.

The biggest decrease corresponds to the Panama district with a 29.9 percent decline, San Miguelito with 49.2 percent and the districts of Bugaba, David, Chitre, Aguadulce y La Chorrera had a combined decline of 49.3 percent. Arraijan stands out as a district with a positive growth of 132.4 percent.

This is a drastic change from last year; while the first quarter of 2008 registered a total investment of $504.7 millions, this year there is a 5 percent decrease with investments adding up to only $477 millions.

The decline is particularly strong against 2007, when a growth of 53.3 percent was registered in this industry.

The president of the Panamanian Association of Real Estate Brokers and Promoters (ACOBIR), Osvaldo Marchena, considers the industry is experiencing an adjustment period and will reactivate with the arrival of foreign enterprises attracted by Panamanian law incentives plus the canal expansion project.

Panamanian economist Adolfo Quintero says that even though the construction industry is facing a slowdown, an important niche are the houses built for less than $30,000 and the sector must refocus investments there.

Quintero advises the new government to give incentives for the construction of low cost housing and speed up the use of the Financial Stimuli Project (PEF), so banks can ease requirements for mortgage loans and reactivate this important sector of the economy.