The Republic of Panama published on March 27 2024 its sustainable finance taxonomy, which represents a classification system that defines eligibility criteria and indicators to identify economic activities that contribute to the transition towards a sustainable, resilient and inclusive economy of the country.

In this context, the government has developed the Sustainable Financing Framework, as a reference framework that allows the issuance of thematic bonds and/or contracting green, social and/or sustainable loans in order to finance new or existing projects that correspond to one of the eligible environmental and/or social categories, and to the extent possible must be aligned with the technical criteria established in Panama’s Taxonomy of Sustainable Finance.

The Sustainable Finance Framework is aligned with the 2021 Green Bond Principles, 2021 Social Bond Principles, and the Sustainable Bond Guide, published by the International Capital Market Association (ICMA).

Sustainable Fitch gave its Second Party Opinion on the framework and considers the level of alignment with the above principles to be excellent and views positively that the country focuses the use of resources on environmental and social projects. It also states that the country has a well-defined project evaluation process, and is committed to reporting resource allocation and the impact of eligible projects on an annual basis.