The National Assembly’s Budget Commission approved recommendations Wednesday to increase Panama’s 2027 state budget by $199.1 million, directing the largest allocations to the Public Works Ministry (MOP), the legislature itself, and health facilities in earthquake-affected regions. The vote was 9 in favor, 3 against, with no abstentions, according to Resolution No. 46 read during the October 15 session.
The adjustments now head to the Ministry of Economy and Finance (MEF), where Vice Minister Fauste Fernández said officials would analyze the proposals before responding. The recommended increases split between $104.4 million for operating expenses and $94.7 million for capital investment, documents show.
Panama Budget 2027 Allocation Breakdown by Institution
The MOP tops the list with a proposed $30 million boost for investment projects. The National Assembly follows with $23 million added to its operating budget, a figure that drew immediate scrutiny from opposition lawmakers. The Foreign Relations Ministry would receive $15 million for operations, while the Housing and Territorial Planning Ministry gets $15 million for investment.
Other notable recommendations include $12 million for the Fire Department and $10 million each for the Autonomous University of Chiriquí, the MiBus transit system, and the National Council for Sustainable Development (Conades).
Health Sector and Earthquake Recovery Priorities
Commission President Eduardo Vásquez defended the adjustments as institutional priorities aimed at benefiting the population, particularly health services and communities hit by recent seismic activity. “I want to make it very clear that the recommendations made are entirely institutional, seeking a benefit for the population” [Translated from Spanish], Vásquez said.
The health allocations include $5 million each for the Children’s Hospital, Nicolás A. Solano Hospital, José Domingo de Obaldía Hospital, and the National Oncology Institute, all for operations. Investment recommendations cover $3.65 million for Cecilio Castillero Hospital in Chitré, $3.65 million for the Ocú hospital, $3 million for Luis “Chicho” Fábrega Hospital in Santiago, and $2 million for the Minsa-Capsi in Macaracas. The Gorgas Memorial Institute for Health Studies would receive $5 million split between operations and investment.
Funding Source Debate and Legislative Scrutiny
The proposed increases would draw from debt service funds, a financing mechanism that sparked immediate criticism. Deputy Yamireliz Chong of the Vamos party questioned whether reducing nearly $200 million from debt service to fund operating expenses and investment was fiscally responsible without clear explanations from the MEF.
“For us to make a reduction of almost 200 million dollars to the debt service to increase it to the functioning and investment of the different institutions seems a bit irresponsible to me” [Translated from Spanish], Chong said. She also demanded details on the $23 million increase for the National Assembly, saying the destination of those funds “is not very clear” [Translated from Spanish].
The executive branch’s original 2027 budget proposal totals $35.11 billion, presented by MEF Minister Felipe Chapman on August 11 with a projected 4% economic growth rate. The commission’s recommendations now await MEF analysis before the full Assembly takes up the budget bill.