Panama is using short-term loans to meet its financing needs, but it will need to return to the cross-border bond market, two credit analysts said.

The government is borrowing more debt in currencies other than the USD as it looks to reduce financing costs and expand its access to international markets, according to its 2Q25 fiscal update published in August.

“They are relying on shorter-term loans with two- to three-year maturities, and that has given them respite,” Moody’s Analyst Renzo Merino told Debtwire. “The loans are a viable strategy in the short term, but it would not be sustainable. They will have to return to the market at some point.”