The Laundry Man by Kenneth Rijock ( Penguin/Random House UK)

Sunday, July 31, 2016


Statistics from the Republic of Panama indicate a major capital flight, of assets owned by wealthy Spanish investors, has occurred since the Panama Papers disclosures surfaced in the global media. Holdings of Spanish nationals in Panama, previously appraised at $1.1bn, are now at $511m, a 54% decrease.

Some observers have learned that tax evasion investigations have been initiated in Spain, against a number of wealthy Spanish businessmen, who claimed tax advantages through Panama, and that is the
principal reason for the capital withdrawal, but others believe that the negative publicity generated by the Mossack Fonseca scandal, and the fact that so many investors had retained the Mossack law firm to handle their Panama business, is the principal case for the urgent capital movement.

Whether the reason is criminal tax evasion investigation, or negative publicity, the money is swiftly leaving Panama, reportedly for European tax havens. The impact of this capital drain upon the Panamanian economy, and therefore Country Risk, cannot yet be measured or ascertained.

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