Panama's earthquake: economic implications and recovery outlook

PANAMA - Report 22 Oct 2026 by Marco Fernandez and Jhonatan Astudillo

Panama’s October 9 earthquake caused significant localized damage, particularly in Los Santos, Herrera and Veraguas. As of October 18, approximately 27,516 people had been reported affected nationwide, with 8,403 homes damaged, including 2,081 classified as total losses. Although aftershocks continue, the University of Panama’s Institute of Geosciences reported a general decline in their frequency and magnitude.

The economic implications are concentrated in regions that, despite accounting for just 5.1% of national GDP, collectively generate 26.7% of primary-sector output. Disruptions to livestock, rice, corn and other grain production, alongside damage to roads and bridges, on top of the risks posed by El Niño-related flooding, could affect rural livelihoods, supply chains and domestic distribution. The extent of these effects will depend on the duration of infrastructure disruptions and the speed at which affected businesses and communities resume operations. Meanwhile, the relatively limited damage reported in Panama and Panama Oeste, which together account for 72.8% of national GDP, helps contain the earthquake’s immediate exposure at the national level.

Reconstruction is expected to provide an important offset to initial economic losses, supporting construction and related services over the coming quarters. The timing and scale of recovery will depend on the mobilization of resources and the execution of repair and reconstruction projects. We maintain our 2026 GDP growth forecast at 4.8%.

Now read on...

Register to sample a report

Register
Must have at least 8 characters
Sign-in
Forgot your password?
Copyright 2026 GlobalSource Partners. All rights reserved. This report is prepared for GlobalSource Partners’ clients and may not be redistributed, reproduced, stored in a retrieval system, retransmitted or disclosed, in whole or in part, or in any form or manner, without the express written consent of GlobalSource Partners. This report is distributed simultaneously to our website and other portals used by GlobalSource Partners. The information herein was obtained from various sources and is believed to be reliable but GlobalSource Partners does not warrant its completeness or accuracy. Neither GlobalSource Partners nor any Country Analyst, officer or employee accepts any liability whatsoever for any direct, indirect or consequential damages or losses rising from any use of this report or its contents.