Article written: October 30, 2026
How big is Panama’s 2027 budget, and where is the money going? The proposed 2027 General State Budget totals $35,111.7 million. The bill (No. 644) passed second debate in the National Assembly plenary with 51 votes in favor and 20 against, according to La Prensa, and now moves to third debate.
On October 30, the Ministry of Economy and Finance (MEF) published the priorities Minister Felipe Chapman presented to the plenary during the discussion. They include nearly $1.2 billion more for public works, almost $100 million more for the national water utility IDAAN, and more than $1 billion to guarantee retirement and pension payments.
What Is in the 2027 Budget?
| Item | Amount reported |
|---|---|
| Total 2027 General State Budget | $35,111.7 million |
| Investment (as reported at second debate) | $12,839.7 million (36.6%) |
| Operations (as reported at second debate) | $22,272 million (63.4%) |
| Additional investment in public works | Almost $1,200 million more |
| Additional funds for IDAAN (water) | Almost $100 million more |
| Retirement and pension payments | More than $1,000 million |
| Ministry of Health | $25 million more |
| Ministry of Housing | $16 million more |
| Ministry of Public Security | $16 million more |
The investment and operations split has moved since July. When the Cabinet approved the bill on July 29, investment stood at $12,564 million and operations at $22,547 million. The figures above are the ones La Prensa reported at the second debate. Chapman told lawmakers the final text incorporates 94% of the Budget Commission’s recommendations.
Which Public Works Receive the Extra Money?
According to the MEF, the additional public works funding is directed to rehabilitating roads, repairing bridges and improving production roads. These are the routes that connect producers to markets and families to health and education services.
Chapman framed the budget around that point, telling the plenary that behind every balboa in the budget is a Panamanian waiting for an answer to a need. He added that a budget is measured by how it treats the most vulnerable.
How Much Is Going to Water Infrastructure?
The MEF says IDAAN will receive almost $100 million more for water treatment plants and distribution networks. The stated goal is to bring continuous water service to more communities.
What Deficit Does the 2027 Budget Project?
Chapman said the budget keeps fiscal consolidation on track with a deficit of 2.97% of GDP. For comparison, the 2026 deficit target is 3.5%, and the MEF reported a deficit of $3,387 million (3.56% of GDP) for January through August 2026.
The central government’s own budget falls 7.8% to $16,534.5 million, according to figures Chapman gave in July. Chapman also acknowledged a 2% increase in the state payroll, equal to 5,527 positions, and said that for the first time in 15 years the state is no longer the country’s main employer.
What Happens Next in the Assembly?
The budget now goes to third debate. Chapman reminded lawmakers that the legislature can only approve or reject the budget, not make substantive changes to it.
Why Does the 2027 Budget Matter for Property Buyers and Investors?
Road and bridge rehabilitation, water network upgrades and a larger housing allocation all shape how accessible and livable different parts of the country are. Buyers evaluating areas outside Panama City often weigh road access and water reliability as heavily as price per square meter.
If you are considering a property purchase or investment in Panama, Casa Solution can help you evaluate how public infrastructure spending may affect the specific area and property type you are looking at.
