Panama’s economic growth skips extreme poverty and education – World Bank
"Strong economic growth has led to little improvement for the poor living in rural areas of Panama, particularly for indigenous groups, the decline in the poverty rate has been modest, and extreme poverty still stands at around 15 percent."
The assessment comes from a World Bank (WB) report published on Tuesday, July 31 and says that Panama, faces the challenge of improving the quality of the education system to boost worker productivity and stay on the path of growth.
Panama needs "to invest in its workforce," to maintain the "high rates of economic growth in the last ten years," said the study.
"The best investment in Panama is the role of human capital. "
The Panamanian economy, which expanded by 10.6% in 2011, "will be better prepared to grow and withstand future shocks if it has a more educated workforce that adapts easily to changes in labor demand," said WB senior economist Javier Luque, specializing in education and an author of the report.
The analysis of the financial institution noted that the "robust growth of the Panamanian economy between 2001 and 2011 was accompanied by an expansion of employment of 44%", reducing unemployment, "mostly in urban areas."
In that decade, the dynamism of the service sector created about 50% of new construction jobs and the sector led the growth of wages, the report said"To increase access to better jobs in rural areas will be essential to have an articulated policy" that includes the possibility that the great majority can be educated and "also aims to improve agricultural productivity," said the report.
According to the diagnosis of the international organization, the "challenge of improving the overall quality of the education system is evident in that the Panamanians have on average 11 years of education" but that could amount to just "three years of schooling" if it meets the educational attainment by quality, by the standards of the Organization for Economic Cooperation and Development (OECD).
The WB report also identified that only 5% of the students of the poorest have access to higher education, and proposed "improvements in the high school graduation rates, and policies to stimulate demand for education" to overcome that obstacle.
"The provision of tertiary education (higher) must also evolve to improve its relevance and focus, and to promote quality and efficiency," said the WB.
The agency acknowledged in its report that social programs like universal scholarship, benefiting some 678, t000 primary and secondary students are "well funded", but recommended that they be evaluated "to determine whether they are achieving the desired results and whether they are cost- efficient. "
It also advised improved focus, monitoring and evaluation of other social programs such as pensions for seniors, health interventions and maternal nutrition and school feeding programs, so they can really "contribute to greater equality in the human capital in Panama."
