Data Collection 2: Panama

Data Collection 2: Panama

GDP per Capita PPP: GDP (Gross Domestic Product) is an important indicator when measuring development in a country. The data presented for this indicator is a sum of the total expenditures for all good and services in a given period of time, adjusted by purchasing power parity, and then divided by the total population. PPP GDP is the GDP converted into international dollars using purchasing power parity rates.


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Starting from an all time low of 7462.66 USD in 1990, the figures have reached an all time high of 19637.09 USD in 2015. (Trading Economics 2014) In only two decades, the GDP per capita has almost tripled in Panama, signifying great development. Over the years, a gradual increase is evident and in 2007, the figures strike up quite rapidly. It is also important to note that in the time span of 20 years, the figures never decreased from previous years except in 2002. This downfall seems to be an anomaly as it was only a slight drop and did not repeat once again.


Demographic data is important to analyze in measuring development in a country. The population pyramid visually presents the total male and female population and divides them into age groups.



The population pyramid has slightly changed from 1991 to 2014. One of the primary changes evident is that it has moved from an DMT stage 2 population to a DMT stage 3 population and remains in an expansive shape. This change shows some development; however, Panama still need some time to be classified as developed and move to a stage 4 or 5. Over the 20 years, the birth rates still remain high as seen from the wide bottom. However, it has slightly changed from a completely youthful population to an older one. Also, the female and male ratio seems to be stable. The top of the pyramid is tapering still; however, it can be observed that the life expectancy has certainly increased. These points above show some development for Panama, but more is needed to classify the country as a developed one.


HDI (Human Development Index): The HDI values are an important factor to take into account when measuring development. The measure takes into account life expectancy, education and GNI per capita and converts it into one figure and ranks the country.

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Above, the contribution of each component to the Human Development Index is seen. As seen, the components aren’t very stable in terms of contribution. Education always seems to be the weakest contributor while life expectancy seems to be the highest. The difference between the two is massive as seen above. Taking into account these two factors and GNI per capita, in 2013, he recorded HDI for Panama was 0.765, which ranked the country 65th. Although Panama is not yet among the highest HDI countries, it has very much developed since 1990, when the HDI value was 0.651.


GINI Index values are also essential. A value of 0 represents equality and an index value of 100 represents perfect inequality.

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Here it is seen that the GINI index value for Panama is just above half way – 51.9. Values from years earlier than 2000 were not recorded. From 2000 to 2013 though, it is seen that the values have not fluctuated, in fact nearly stayed constant.


Population living under poverty line: Percentage of total population living under $1.25 per day.


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Although 26% living under the poverty line may not seem like a huge deal, it actually is. Although it may not compare to Sierra Leone for example, with 70.2%, one fourth of the population is quite a lot. It is also to note that Panama does have an enormous population, 3.8 million, but still has a high percentage of population living under the poverty line.


When comparing the HDI rank of Panama with its GDP per capita rank, one can see that both are close. The HDI of Panama is recorded to be 0.765 and ranks 65th in the world. On the other hand, the GDP per capita value is 19637.09 and ranks 57th in the world. It would be appropriate to conclude that if it matters only slightly, Panama seems to be scoring higher in relation to other countries in the measure of GDP per capita.


Primary school drop out rates (%): It is important to see how much percent of the students receiving education drop out in primary years.

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Looking at this measurement, 8.39% of students drop out of school in primary years. This percentage is actually quite high in comparison to a developed country; a developed country would not have a drop out ratio close 1:10; therefore, it is seen that Panama still has some time in order to develop in the area of education.


Adult Literacy Rate (% of population 15 and older): It is important to take this measurement into analysis to see how much of the population are educated. This is a very important measurement that should be quite high for any country that is in the progress of developing and/or aims to develop in the near future.

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When looking at the values for this measurement, 94.1% in 2015 seems quite high. However this value can always go higher. This measurement seems be to be closest to that of a developed country’s value.


Unemployment Rate:

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Unemployment rate is an important measure because it represents the ratio of people working and not working. Recently, in 2015, Panama reached an all time high employment percentage: The unemployed decreased to 2.50 percent. In 1988, the unemployed percentage was recorded to be 16.30, which is very high.

CO2 Emissions (Metric tons per capita):

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Carbon dioxide emissions are those that result from burning fossil fuels and manufacture of cement. The earliest data starts from 2005, with 2.0 metric tons and increases to 2.6 in 2011. We can’t expect the measurement to decrease because population and manufacturing increases by time. 2.6 metric tons at the moment doesn’t seem to be too much at the moment, but it is important to disable it form increasing. The values of Panama seem to be very similar to those of developing Latin American and Caribbean countries.


Life Expectancy at Birth

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The measurement indicates the number of years a newborn baby is expected to live if patterns continue. From 2005, the life expectancy has increased by 1.6 years: 76.0 to 77.6. These values are relatively higher than those in developing Latin American and Caribbean countries.


Blog Post 2

El Nino Impacts Panama Canal Too!

Despite being a passionately cultured country, Panama is also located in a very special area for trade. One of the first images that come to mind is the Panama Canal, which was built in 1994. As this canal connects the Atlantic Ocean to the Pacific, it serves a very important role for international trade. This 50 mile long canal saves very much fuel and a great amount of time to reach its destination. This canal route is preferred by almost everyone to avoid having to travel around South America, which is an extra 8,000 nautical miles. With the slow speed cargo ships travel in, this distance can be extremely time consuming, especially in a rough climate. Everyday, an average of 36 large cargo ships and 70 private owned yachts use this route.


Although this may sounds life saving, it has its consequences too. Every few years, an El Nino’s impact is dealt with. Some years are more severe than others, for example, this year. Recently, on August, the government was obliged to impose new restrictions on how much cargo ships can carry. For a developing country like Panama, these small factors matter immensely. They hinder development and economic gain for the country. The restriction is that the maximum draught length can be 11.89 meters. The issue arose from limited rainfall in Gatun and Alajuela lakes. Rainfall is vital because the canal operates with water: as it consists of three different sections/locks, each section raises the ship to a higher level by compressing water under it. To raise such heavy ships to a higher water level, one can only imagine how much water and force is needed and for the moment, Panama lacks this quantity.

*Draught: the vertical distance between the ship’s hull and the water line.

An El Nino is a natural phenomenon that occurs every few years. This event affects many individuals in coastal areas all the way from floods and droughts to low fish catches. In other words, this phenomenon affects climate change immensely. During an El Nino atmospheric pressure switches (Southern Oscillation) and trade winds reverse, carrying warm water to the west coast of South America. The increase in surface water temperatures alters rainfall patterns.



Although the authorities note that only six of the 36 daily passing ships will be affected, in the long run this could be economically harmful for Panama. Additionally, firms will not be able to export goods to their full extent; therefore, big ships will be futile for a period of time. Customers will be affected too: if they need large quantities of a good, so much that it exceeds restricted cargo weight, two ships will be needed, which will be economically disadvantageous for the buyer. If this problem affects more ships, this will be a problem for Panama. An average full cargo ship contains 3,800 full containers, each full container is charged 82 dollars; so, that’s 320,000 dollars already. Tugboats and ground assistant also account for another 30,000 dollars. In 6 months, if six ships were to change their route per day, this would sum up to 400 million dollars solely from cargo ships passing through the canal. In the long run, these numbers will become greater and result in great loss for Panama, especially when they are on the verge of economically developing. Also, Services account for 78.3% of GDP for the country; therefore, an economic loss in the area could be consequential.

Although the Panama government seems to be aware and has started to take some precautions by setting restrictions, the worry continues. Unfortunately rainfall cannot be regulated by the locals; therefore, circumstances for Panama may even get worse with need of further restrictions. After this issue, the locals should question whether the third lane for the canal, which has been in the process of building for the past few years, is appropriate or not.Without having the chance to use the third lane, the government may decide to drop to one lane use only if rainfall is limited.


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