Early stage entrepreneurial activity (TEA) increased in Panama by 6 percentage points in 2022 compared to the previous year.
Entrepreneurship is a fundamental driver of the health and wealth of society. It is also a formidable engine of economic growth that promotes the essential innovation needed not only to seize new opportunities, boost productivity and create jobs, but also to address some of society's biggest challenges. This is in part why Fundación Ciudad del Saber (City of Knowledge Foundation) began supporting GEM research in 2009. The study in Panama is carried out by the Panama Micro, Small and Medium Enterprise Authority and the Institute of Higher Studies.
Entrepreneurship in Panama
In 2022, Panama had the highest entrepreneurial parity by gender among the economies in its category, followed by Chile and Uruguay. Regarding age, more than half (55%) of early entrepreneurial activity consists of people between the ages of 25 and 44, with only 19% coming from those ages of 45 and 54.
Almost two-thirds of early-stage entrepreneurs have not completed their higher education, a figure that increased by 10% compared to 2021. Those with university education come in at 26% and 11% have advanced postgraduate or technical education.
Retail trade is a key entrepreneurial activity. A positive improvement has been observed in the information and communications sector, with growth of 8% in 2022 compared to 4% in 2021.
Other Key Data:
|
|
2020 |
2021 |
2022 |
|
Nascent entrepreneurs (businesses have been paying wages for not more than three months) |
23% |
15% |
16% |
|
New entrepreneurs (those whose businesses have been paying salaries for more than three months but not more than 42 months) |
9% |
7% |
12% |
|
TEA |
32% |
22% |
28% |
|
Established entrepreneurs |
4% |
4% |
6% |
|
Sold or abandoned a business |
11% |
9% |
8% |
|
Women’s TEA |
29% |
20% |
25% |
|
TEA businesses that use technologies considered new outside of Panama |
7% |
4% |
2% |
|
Businesses projected to have 20+ employees in the next 5 years |
15% |
12% |
12% |
Main opportunities to promote entrepreneurship in Panama
The data in the report underscores several opportunities to promote entrepreneurship:
1. Develop entrepreneurial human capital and business competitiveness (innovation, technology, scalability, internationalization, etc.) so that Panamanian entrepreneurs can establish themselves in the local market and compete in international markets.
2. Improve access to financing, mainly in early stages. (It is noteworthy that investors’ decision-making is highly dependent on the competitiveness of entrepreneurs and their businesses).
3. Improve entrepreneurial education, mainly in the school stage (kindergarten, primary and secondary) on topics such as creativity, entrepreneurship and innovation.
Fundación Ciudad del Saber supports GEM Panama as it provides data that helps the entrepreneurial ecosystem and the State to generate public policies, products and services that adapt to the real needs of entrepreneurs.