The Minister of Economy and Finance in Panama, Frank De Lima, in a meeting with the press, said that the priority for his department will be to create a draft bill to be debated in the political and social arena before being sent to the National Assembly.
"He said that the Sovereign Fund is not designed to pay debts, but rather to be a store of savings for development and other objectives that appear in the draft and will be discussed widely both within and outside of the legislative chamber and party caucuses.
We believe that the Sovereign Fund is going to launch Panama into a new category which will give it a better international position in the conceptualization of country-risk", reported Prensa Latina.
Source: prensa-latina.cu
More on this topic
February 2012
According to government projections, Panama's future sovereign fund will have $12.5 billion in assets by 2025.
This fund will be used to combat natural disasters or adverse economic circumstances.
"Every year, of the contributions generated by the Canal to the State, a portion will go to the National Treasury - the equivalent of 3% of gross domestic product (GDP) - and anything in excess of that amount will be saved" in the sovereign fund, explained Prensa.com.
April 2012
The Fondo de Ahorro de Panamá (Panama Savings Fund) aims to be a mechanism for economic stabilization and savings for natural disasters or economic crises.
"The Cabinet has approved a bill proposing the creation of a sovereign fund called the ‘Fondo de Ahorro de Panamá ‘(FAP), which according to a statement from the presidency will have two parallel objectives: National savings for future generations and economic stabilization in case of predetermined situations such as natural disasters or economic crises," reported Capital.com.pa.
August 2011
The fund will collect the additional revenue generated by the Panama Canal when the new locks come into operation.
Alberto Vallarino, Minister of Economy and Finance, explained that it will function as a stabilization fund, ensuring that budgets are balanced and without deficit, adding that its management will be totally independent from the government.
January 2012
Savings must be made and reserves accumulated during booms times, so that those funds can be used in times of national crisis or contraction.
The creation of funds to build up currency reserves during periods of economic expansion from specific high-revenue sources, such as China's trade surpluses, Chile's copper or Norway's oil, is an option to be considered in Panama, which does not have a central bank to control monetary policy or act as a lender of last resort.
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