News

Panama to Make Spending More Efficient and Equitable with $20 Million Loan from IDB

Panama will increase the efficiency and equity of its spending by implementing its Smart Fiscal Ecosystem with a $20 million loan from the Inter-American Development Bank (IDB).

The data ecosystem will enable government agencies to share high-quality information in a secure and confidential way. It will also feature algorithms that analyze third-party databases in real time, helping agencies identify beneficiaries of social programs, verify eligibility and obligations, and take other actions.

Panama will launch a governance plan as it implements the system, to include designing and instituting an expenditure-quality unit, overhauling positions and functions, hiring a budget specialist with a gender and diversity approach, and managing digital tools.

The project will also develop algorithms and methods to better identify and measure spending leakages. Additionally, it will establish databases to better identify vulnerable groups such as women and indigenous persons among the economically active population as well as informal workers in regional databases to inform policies to better target job and social transfer programs.

In the area of technology management, IDB financing will help Panama with data governance and interoperability needs for the Smart Fiscal Ecosystem, identify and purchase energy-efficient and low-carbon technological infrastructure equipment, and develop and deploy an information security and privacy model, as well as cybersecurity protocols.

The Panamanian population, companies and government will be the program’s beneficiaries. Vulnerable populations, especially women and indigenous people, will benefit from cross-checking data for reports that will help channel resources to those who need them most.

Public officials will benefit from better information, processes, regulations and tools to manage public resources, as the project enhances the capacity of the state.

This operation aligns with the Vision 2025, the IDB’s roadmap for achieving recovery and sustainable, inclusive growth in Latin America and the Caribbean. It is also in line with the IDB Group Strategy with Panama for 2021-2024.

The $20 million IDB loan has a 15-year amortization term, a 4.5-year grace period and an interest rate based on the Secured Overnight Financing Rate. It will require government approval.

About the IDB

The Inter-American Development Bank is devoted to improving lives. Established in 1959, the IDB is a leading source of long-term financing for economic, social, and institutional development in Latin America and the Caribbean. The IDB also conducts cutting-edge research and provides policy advice, technical assistance, and training to public and private sector clients throughout the region.

 

Press contact

More Information

Jose Larios
IDB Project Team Leader
josel@iadb.org