The Ministry of Economy and Finance (MEF) of Panama supported before the Budget Commission of the National Assembly, the General State Budget for fiscal 2022, which amounts to $25.1 billion.

This represents an increase of $881 million, around 3.3%, compared to the budget presented in July, which was $24.245 billion.

According to the head of the MEF, Héctor Alexander, these resources, compared with the aspirations presented by public sector institutions, of $31.158 billion, represent an amount less than $6.032 billion. "However, the structure of the budget project covers the basic needs of the institutions and is oriented towards a process of reactivating the economy," as indicated.

Alexander explained that "the budget, in investments, was structured considering investments that are not part of the 2022 budget but that will have an impact in the year 2022."

Current income of the Central Government

In the budget, current revenues of the Central Government have been considered for $9.572 billion:

$5.949 billion correspond to income tax revenue.
$3.518 billion correspond to non-tax income.
$106 million correspond to income from incorporated or self-managed funds.

“Within the non-tax income, contributions to the treasury for $185.6 million are included in income, product participation of company profits for $2.105 billion, which include contributions for toll from the ACP of $615 million and channel dividends estimated at $1.880 billion, ”the minister explained.

Total expenses

In this way, the Budget, on the side of total expenses, includes for current expenses $14.895 billion:

Personnel services: $6.479 billion were assigned in expenses.
Goods and services: $2.324 billion were assigned.
Transfers: $3.902 billion were assigned.
Debt interest payments: $2.190 billion were assigned.
Capital expenditures: $6.652 billion were assigned.
Financial investments: $1.679 billion were assigned.
Resource for debt amortization: $1.900 billion were assigned.

"The total expenses of $25.126 billion, are equal to the income indicated above," said the MEF.

Distribution by area

From the point of view of the grouping of the budget with respect to the non-financial public sector, which corresponds to the budget, fewer financial entities such as the National Bank, the Savings Bank and companies with autonomous performance, were assigned in the order $15.198 billion, with which total expenses of $17.678 billion are attended, of which $13.665 billion are current expenses and $4.013 billion are capital expenses.

"The difference between income and current expenses, gives us a positive current saving of $1.533 billion and this result is important because it is a qualitative change in the structuring of the budget in relation to 2020 and 2021, where the current balance it was negative for more than $1.100 billion," said MEF officials.

Deficit

The result of the non-financial public sector deficit is estimated at $2.480 billion, which is equivalent to 4% in relation to GDP. This reflects a reduction in relation to the two previous years that was close to 10% in 2020 and close to 7% is estimated for 2021.

This in the central government reflects total income of $10.111 billion against total expenses of $12.290 billion, and an estimated current saving of $993 million, positive and favorable in relation to the two previous years.

The expected deficit for 2022 would be $2.1797 billion, approximately a 50% reduction with that expected in 2021, and 60% with the results of 2020.

Investments

The 2022 budget includes investments in the amount of $8.282 billion:

$2.119 billion have been assigned in the Central Government and is equivalent to 25.6%.
$2.853 billion have been assigned to decentralized institutions that are equivalent to 34.4%.
$829 million were assigned to the public company that is equivalent to 10%.
$2.481 billion were assigned to financial intermediaries entities that are equivalent to 20%.

From the investment point of view, the $8.282 billion were distributed in $2.464 billion for physical investments, that is, 29.7%, $1.798 billion for non-physical investments, which is 21.7%, and for financial investment $4.020 billion, which is 48%.

Budget distribution by sectors

Development of social services: $11.553 billion, which is equivalent to 46%
Environmental and technological development: $186 million, which is equivalent to 1%
Infrastructure development: $1.561 billion, which is equivalent to 6%
Development and promotion of production: $669 million, which is equivalent to 3%
Financial services: $3.973 billion, which is equivalent to 16%
General services $3.112 billion, which is equivalent to 12%
Public debt service: $4.072 billion, which is equivalent to 16%

Budget distribution by subsectors

Health: $4.460 billion, which is equivalent to 18%
Education: $2.951 billion, which is equivalent to 12%
Protection and Social Security: $3.294 billion, which is equivalent to 13%
Public order, security and justice: $1.420 billion, which is equivalent to 6%
Environment and technology, which is equivalent to 1%
Justice sector: $400 million, which is equivalent to 4.2%

Distribution of COVID-19 funds for 2022:

Mides - Vale Digital: $400 million
Minsa - Vaccination and health care plan: $195 million
MIDA / IMA - Bolsa Solidaria: $25 million
Minseg - National Security Plan: $20 million

For 2022 there is an increase of $216 million in interest compared to previous years.

Alexander indicated that $200 million will cover the increases that by law are established with the unions, there are no appointments in the budget presented. For his part, Congressman Edison Broce said he distrusted that all the increase in payroll spending corresponds to special laws, which caused the minister's annoyance, who asked to clarify his question.