Central America Rising

The sun is shining on the region’s economies, but sustaining growth will hinge on US polices on immigration, trade and aid.

As the nations of Central America—Panama, Belize, Costa Rica, Guatemala, El Salvador, Honduras and Nicaragua—strive to build economic strength, their rich neighbor up north is both a blessing and a curse.

The US, Latin America’s largest trading partner, provides a steady demand for goods, inflows of direct investment and a stable stream of funds from the Central American diaspora. With US growth trending upward, the partnership has been a boon for a region that is posting overall economic growth of 4% this year—with Panama as its star performer.

“Fiscal stimulus in the United States will propel growth in Central America this year, supporting remittances, exports and tourism,” says FocusEconomics economist Oliver Reynolds.

At the same time, President Donald Trump’s plans to clamp down on immigration, restrict trade and cut

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