The US Is Recovering

Influential daily newspapers like The New York Times and Le Monde recognize the recent economic indexes as the beginning of economic recovery for the U.S. The level of unemployment decreased from 8.3 percent to 7.7 percent, mainly due to the creation of 236,000 new jobs in February. Similarly, the private banks are coming out of the financial crisis triggered by the mortgage credit system, and a significant number of private businesses are paying better dividends to shareholders, particularly in the construction industry. In its interim evaluation, the Federal Reserve has confirmed the growing rhythm of economic recovery and in order to stimulate it, has agreed to maintain a low level of interest rates. The New York Stock Exchange has registered a marked upward trend in the values of the Dow Jones, NASDAQ and Standard & Poors.

It has been predicted that the free trade treaty with the European Union could favor levels of trade with Germany and France and the other member states as they free their economies of the damage caused by the recession. On the other hand, trade with China will remain sustainable and could even increase once the negative fluctuations of the bilateral economy are overcome.

In contrast, however, the U.S. economy is still subject to the political antagonism between Democrats and Republicans, especially in relation to budget cuts advocated by Republican senators which speculate that the increase in public spending of Barack Obama’s government plus his project to raise taxes for the highest earners will generate the highest budget deficit in financial history. In addition, the spectacular figures of an unsustainable debt must be taken into account. The exchange value of the dollar on the internal U.S. market is deteriorating by the inorganic production of billions of dollar bills to repay debts.

The strengthening of the U.S. economy is strategic for Panama. It will contribute to the fortification of the treaty for promoting outward and inward trade. The recovery will allow U.S. businesses to boost their purchasing power, and thus import more products from Panama. At the same time, the sector-based duty reductions will lower the prices of the merchandise used in Panama.

The implementation of the mechanisms of the free trade treaties endorsed by Panama with South American nations like Peru and Chile will allow a progressive flow of imports and exports. The exemption from customs duties should gradually relax inflation as they hit the consumer market.

Furthermore, when the new vegetable market and cold chain premises for conserving perishables is opened, there will be a significant increase in the amount of government infrastructure in Panama. The progress made by the Martinelli administration in the context of opening up the economy to private investment will attract more local and foreign private investors who will generate further sources of work for the benefit of professionals and workers of future generations.