Martinelli good for business?

PANAMA. President-elect Ricardo Martinelli will be good for business according to an article published in Tico Times. Net

Leland Baxter-Neal in her analysis about the Panamanian economy in Tico Times said that Martinelli's proven ability as a successful business manager could help Panama to face the economic global crisis and the slowdown of the country’s growth.

Although Panama's economy has been one of the fastest growing in Latin America, as credit and commerce contract worldwide shrink, the country has not been immune and the slump will be one of the biggest challenges Martinelli faces as he begins his presidency.

Analysts predict a GDP growth in 2009 of only 3 percent, while neighboring Costa Rica might only have a rate of 0.5 percent for this year.

A report of the agency Standard & Poor said that: “In the short term, maintaining positive GDP growth during the global recession will be key.”

It added that “even though, as noted, Panama's is among the handful of economies that we expect to expand in 2009, growth will decelerate sharply and as a result this could make political alliances hard to maintain.” The president elect is an experience negotiator who might be able to maintain those vital alliances. He also has worked in government, serving as chairman of the board of directors of the Panama Canal Authority, as Panama Canal minister and director of Panama's Social Security Administration.

“Frankly, the business sector is going to love Martinelli,” said Heather Berkman, a Latin America analyst for the consulting firm Eurasia Group. “He's planning on cutting corporate taxes to implement the flat tax, and he came out last week saying he would resist any legislation requiring more tax transparency and information sharing – which the US demands as a precursor to movement on the Panama free-trade agreement.

Baxter-Neal said that US. citizens who have emigrated to Panama in recent years, both for business and retirement, in part driving the real estate boom that has pushed dozens of high rise condo and apartment towers skyward are feeling the crunch as local banks have restricted the local credit and obtaining new credit for real estate projects in Panama City has almost entirely been paralyzed.”

Fernando Duque, president of the real estate development company Buenaventura said that he expects the Martinelli administration to continue to invest in tourism.