# EDGAR Filing Document

**Accession Number:** 0000076027
**File Stem:** 0001193125-23-081966
**Filing Date:** 2023-3
**Character Count:** 398251
**Document Hash:** 4c27dae7176d54c84a35216a72cb765e
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001193125-23-081966.hdr.sgml**: 20230328

**ACCESSION NUMBER**: 0001193125-23-081966

**CONFORMED SUBMISSION TYPE**: 18-K/A

**PUBLIC DOCUMENT COUNT**: 7

**CONFORMED PERIOD OF REPORT**: 20211231

**FILED AS OF DATE**: 20230328

**DATE AS OF CHANGE**: 20230328

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** PANAMA REPUBLIC OF
- **CENTRAL INDEX KEY:** 0000076027
- **STANDARD INDUSTRIAL CLASSIFICATION:** FOREIGN GOVERNMENTS [8888]
- **IRS NUMBER:** 000000000
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 18-K/A
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 333-07558
- **FILM NUMBER:** 23768688

**BUSINESS ADDRESS:**
- **STREET 1:** 2862 MCGILL TERRACE NW
- **STREET 2:** C/O AMBASSADOR OF PANAMA
- **CITY:** WASHINGTON
- **STATE:** DC
- **ZIP:** 20008

**MAIL ADDRESS:**
- **STREET 1:** MINISTRY OF ECONOMY & FINANCE,
- **STREET 2:** VIA ESPANA AND CALLE 52
- **CITY:** APARTADO POSTAL BOX 2694
- **STATE:** R1
- **ZIP:** 00000

------

------

**SECURITIES AND EXCHANGE COMMISSION** 

**Washington, D.C. 20549** 

------

**FORM 18-K/A** 

------

**AMENDMENT NO. 2** 

**For Foreign Governments and Political Subdivisions Thereof** 

------

**ANNUAL REPORT** 

**of the** 

## REPUBLIC OF PANAMA
**(Name of Registrant)** 

------

**Date of end of last fiscal year: December 31, 2021** 

------

**SECURITIES REGISTERED\*** 

**(As of the close of the fiscal year)** 

------

---

| | | |
|:---|:---|:---|
| **Title of Issue** | **Amounts as to**<br> **which registration**<br> **is effective** | **Names of**<br> **exchanges on**<br> **which registered** |
| N/A | N/A | N/A |

---

------

**Name and address of person authorized to receive notices** 

**and communications from the Securities and Exchange Commission:** 

**Ramón E. Martínez de la Guardia** 

**Ambassador of Panama** 

**Embassy of Panama** 

**2862 McGill Terrace, NW** 

**Washington, D.C. 20008** 

**It is requested that copies of notices and communications from the Securities and** 

**Exchange Commission be sent to:** 

**Eli Whitney Debevoise II, Esq.** 

**Arnold & Porter Kaye Scholer LLP** 

**601 Massachusetts Avenue, N.W.** 

**Washington, D.C. 20001** 

------

\* The Registrant is filing this annual report on a voluntary basis.

------

**REPUBLIC OF PANAMA (THE "REGISTRANT" OR "REPUBLIC")** 

Reference is made to the registration statement of the Registrant filed with the Securities and Exchange Commission (the "Commission") effective as of December 1, 2020 (Registration No. 333-250981) (the "Registration Statement").

The purpose of this Amendment to the annual report of the Registrant on Form 18-K for the year ended December 31, 2021, as amended, is to file with the Commission (i) the legal opinions included as Exhibits J and K in accordance with the Registrant's undertaking in the Registration Statement to furnish copies of such legal opinions as may be required (including the opinion of the *Procurador de la Administración*) in connection with any issue of securities under the Registration Statement, (ii) a form of the Registrant's 6.400% Global Bonds due 2035 and 6.853% Global Bonds due 2054, included as Exhibits L and M hereof, (iii) a conformed copy of the Terms Agreement, dated March 21, 2023, by and between the Republic and Goldman Sachs & Co. LLC and Scotia Capital (USA) Inc., included as Exhibit N hereof, and (iv) the Recent Developments in the Registrant as of March 21, 2023, included as Exhibit O hereof.

------

**EXHIBIT INDEX** 

---

| | |
|:---|:---|
| Exhibit<br> No. |  |
| &nbsp;&nbsp;&nbsp;&nbsp;A: |  |
| &nbsp;&nbsp;&nbsp;&nbsp;B: |  |
| \*C: | &nbsp;&nbsp;&nbsp;&nbsp;Copy of the 2022 Annual Budget of the Republic (in Spanish) (Rule 311) (P) |
| \*D: | &nbsp;&nbsp;&nbsp;&nbsp;Current Description of the Republic |
| \*E: | &nbsp;&nbsp;&nbsp;&nbsp;Opinion dated November 21, 2022 of Arnold & Porter Kaye Scholer LLP |
| \*F: | &nbsp;&nbsp;&nbsp;&nbsp;Opinion dated November 21, 2022 of the *Procurador de la Administración* |
| \*G: | &nbsp;&nbsp;&nbsp;&nbsp;Form of 6.400% Global Bonds due 2035 |
| \*H: | &nbsp;&nbsp;&nbsp;&nbsp;Terms Agreement, dated November 14, 2022, by and between the Republic and BofA Securities, Inc. and HSBC Securities (USA) Inc. |
| \*I: | &nbsp;&nbsp;&nbsp;&nbsp;Recent Developments in the Registrant as of November 14, 2022 |
| &nbsp;&nbsp;&nbsp;&nbsp;J: | &nbsp;&nbsp;&nbsp;&nbsp;Opinion dated March 28, 2023 of Arnold & Porter Kaye Scholer LLP |
| &nbsp;&nbsp;&nbsp;&nbsp;K: | &nbsp;&nbsp;&nbsp;&nbsp;Opinion dated March 28, 2023 of the *Procurador de la Administración* |
| &nbsp;&nbsp;&nbsp;&nbsp;L: | &nbsp;&nbsp;&nbsp;&nbsp;Form of 6.400% Global Bonds due 2035 |
| &nbsp;&nbsp;&nbsp;&nbsp;M: | &nbsp;&nbsp;&nbsp;&nbsp;Form of 6.853% Global Bonds due 2054 |
| &nbsp;&nbsp;&nbsp;&nbsp;N: | &nbsp;&nbsp;&nbsp;&nbsp;Terms Agreement, dated March 21, 2023, by and between the Republic and Goldman Sachs & Co. LLC and Scotia Capital (USA) Inc. |
| &nbsp;&nbsp;&nbsp;&nbsp;O: | &nbsp;&nbsp;&nbsp;&nbsp;Recent Developments in the Registrant as of March 21, 2023 |

---

\* Previously Filed

(P) Previous paper filing under cover of Form SE pursuant to Rules 306(c) of Regulation S-T

------

**SIGNATURE** 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this amendment to the annual report to be signed on its behalf by the undersigned, thereunto duly authorized, at the City of Panama, Panama, on the 28<sup>th</sup> day of March, 2023.

---

| | |
|:---|:---|
|  REPUBLIC OF PANAMA | REPUBLIC OF PANAMA |
|  By: | /s/ Héctor E Alexander H. |
|  Name: | Héctor E Alexander H. |
|  Title: | Minister of Economy and Finance of the Republic of Panama |

---

## Ex-99.J

**Exhibit J** 

[*Letterhead of Arnold & Porter Kaye Scholer LLP*]

March 28, 2023

Ministry of Economy and Finance

Republic of Panama

Via España y Calle 52

Edificio Ogawa, Piso 4

Panama, Republic of Panama

Ladies and Gentlemen:

We have acted as special United States counsel for the Republic of Panama ("Panama") in connection with (i) the issuance by Panama of U.S.$800,000,000 aggregate principal amount of its 6.400% Global Bonds due 2035 and U.S.$1,000,000,000 aggregate principal amount of its 6.853% Global Bonds due 2054 (collectively, the "Global Bonds") and (ii) the transactions contemplated by the Terms Agreement (the "Terms Agreement") dated as of March 21, 2023, among Panama and Goldman Sachs & Co. LLC and Scotia Capital (USA) Inc. We are familiar with the form of the Fiscal Agency Agreement, as amended by Amendment No. 1 thereto, dated as of September 4, 2003, Amendment No. 2 thereto, dated as of February 13, 2015, and Amendment No. 3 thereto, dated as of October 26, 2016, including the forms of Security attached to such agreement (as so amended, the "Fiscal Agency Agreement"), the Underwriting Agreement that forms part of the Terms Agreement, the Terms Agreement and Panama's Registration Statement on Schedule B filed on November 25, 2020 (Registration No. 333-250981) (the "Registration Statement"), including the Prospectus dated December 1, 2020, and the Prospectus Supplement dated March 21, 2023 constituting a part thereof. We have also reviewed Panama's Annual Report on Form 18-K for the fiscal year ended December 31, 2021 (the "Annual Report") filed with the Commission under the Securities Exchange Act of 1934, as amended. The Terms Agreement and the Fiscal Agency Agreement are collectively defined herein as the "Agreements." Capitalized terms used herein without definition shall have the respective meanings set forth in the Terms Agreement.

In rendering the opinion expressed below, we have examined such certificates of public officials, government documents and records and other certificates and instruments furnished to us, and have made such other investigations, as we have deemed necessary in connection with the opinion set forth herein. Furthermore, we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the authority of Panama to enter into the Agreements and cause the issuance of the Global Bonds, and the conformity to authentic originals of all documents submitted to us as copies. As to any document originally prepared in any language other than English and submitted to us in translation, we have assumed the accuracy of the English translation.

------

This opinion is limited to the federal laws of the United States and the laws of the State of New York, and we do not express any opinion herein concerning the laws of any other jurisdiction. Insofar as the opinion set forth herein relates to matters of the laws of Panama, we have relied upon the opinion of Licenciado Rigoberto González Montenegro, the *Procurador de la Administración* of Panama, a copy of which is being filed as an exhibit to the Annual Report, and our opinion herein is subject to any and all exceptions and reservations set forth therein.

Based upon and subject to the foregoing and assuming the due authorization of the Global Bonds by Panama, we are of the opinion that when the Global Bonds have been duly authorized, issued and executed by Panama and authenticated, delivered and paid for as contemplated by the Agreements, the Prospectus and any amendment and supplement thereto, the Global Bonds will constitute valid and legally binding direct and unconditional obligations of Panama under the laws of the State of New York.

We hereby consent to the filing of this opinion as an exhibit to the Annual Report and to the reference to this firm under the heading "Validity of the Global Bonds" in the Prospectus Supplement referred to above. In giving the foregoing consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission thereunder.

---

| |
|:---|
| Very truly yours, |
| /s/ Arnold & Porter Kaye Scholer LLP |

---

## Ex-99.K

**Exhibit K** 

[*Letterhead of the Procurador de la Administración*]

March 28, 2023

The Hon. Hector Alexander

Minister of Economy and Finance

Republic of Panama

P.O. Box 2694, Zona 3

Panama, Republic of Panama

Dear Minister:

I, the *Procurador de la Administración* of the Republic of Panama ("Panama"), have reviewed the Republic's Registration Statement No. 333-250981 on Schedule B (the "Registration Statement") including the Prospectus dated December 1, 2020, and the Prospectus Supplement dated March 21, 2023, constituting a part thereof, the Fiscal Agency Agreement dated as of September 26, 1997, as amended by Amendment No. 1 thereto, dated as of September 4, 2003, Amendment No. 2 thereto, dated as of February 13, 2015, and Amendment No. 3 thereto, dated as of October 26, 2016, including the forms of Security attached thereto (the "Fiscal Agency Agreement") and the Underwriting Agreement that forms part of the Terms Agreement (the "Terms Agreement"), dated as of March 21, 2023 among the Republic of Panama ("Panama") and Goldman Sachs & Co. LLC and Scotia Capital (USA) Inc. (the "Underwriters"), pursuant to which Panama proposes to offer and sell U.S.$800,000,000 principal amount of its 6.400% Global Bonds due 2035 and U.S.$1,000,000,000 principal amount of its 6.853% Global Bonds due 2054 (collectively, the "Global Bonds").

The issuance of the Global Bonds has been authorized pursuant to Cabinet Decree No. 30, dated November 8, 2022 and Cabinet Decree No. 11, dated March 14, 2023.

It is my opinion that, as of March 28, 2023, the Global Bonds were, and they remain, duly authorized, and when executed and delivered by Panama and authenticated pursuant to the Fiscal Agency Agreement and delivered to and paid for by the Underwriters pursuant to the Terms Agreement, the Prospectus (including, without limitation, the Prospectus Supplement) and any amendment or supplement thereto, the Global Bonds constituted and constitute valid and legally binding, direct and unconditional obligations of Panama under the present laws of Panama.

I hereby consent to the filing of this opinion as an exhibit to the Annual Report of Panama on Form 18-K for the fiscal year ended December 31, 2021, as amended, and to the use of my name under the heading "Validity of the Global Bonds" in the Prospectus Supplement referred to above. In giving the foregoing consent, I do not thereby admit that I am in the category of persons whose consent is required under Section 7 of the U.S. Securities Act of 1933, as amended, or the rules and regulations of the U.S. Securities and Exchange Commission thereunder.

------

Sincerely,

/s/ Rigoberto Gonzalez Montenegro

**Rigoberto Gonzalez Montenegro** 

Procurador de la Administración

Republic of Panama

## Ex-99.L

**Exhibit L** 

REGISTERED GLOBAL SECURITY

CUSIP No. 698299 BT0

ISIN No. US698299BT07

Common Code: 255897977

THIS SECURITY IS A DEFINITIVE REGISTERED GLOBAL SECURITY WITHIN THE MEANING OF THE FISCAL AGENCY AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), OR A NOMINEE THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN DTC OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE FISCAL AGENCY AGREEMENT.

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC TO THE REPUBLIC OF PANAMA OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

------

THE REPUBLIC OF PANAMA

6.400% Global Bonds due 2035

---

| | |
|:---|:---|
| No. [•] | U.S.$[•] |

---

THE REPUBLIC OF PANAMA (herein called the "Issuer" or the "Republic"), for value received, hereby unconditionally promises to pay to CEDE & CO., or registered assigns, the principal sum of [•] (the "Principal Amount") IN UNITED STATES DOLLARS (U.S.$[•]) on February 14, 2035 (the "Stated Maturity"); and to pay interest on the Principal Amount outstanding from November 21, 2022, or from the most recent Interest Payment Date to which interest has been paid or duly provided for, semi-annually in arrears on February 14 and August 14 of each year, commencing August 14, 2023 (each an "Interest Payment Date"), at the rate of 6.400% per annum, until the aggregate Principal Amount is paid or made available for payment. The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in the Fiscal Agency Agreement hereinafter referred to, be paid to the person (the "registered holder") in whose name this Security is registered at the close of business on January 31 or July 31 (whether or not a business day), as the case may be (each a "Regular Record Date"), next preceding such Interest Payment Date. Interest shall be calculated on the basis of a 360-day year, consisting of twelve 30-day months. Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the registered holder on such Regular Record Date and may either (i) be paid to the person in whose name this Security (or one or more predecessor Securities) is registered at the close of business on a special record date for the payment of such interest to be fixed by the Issuer, notice whereof shall be given to registered holders of Securities of this Series not less than 10 days prior to such special record date, or (ii) be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities of this Series may be listed, and upon such notice as may be required by such exchange.

Principal of and any premium on this Security shall be payable against surrender of this Security at the corporate trust office of the Fiscal Agent hereinafter referred to and at the offices of such other Paying Agents as the Issuer shall have appointed pursuant to the Fiscal Agency Agreement. Payment of the principal hereof and of any premium on this Security shall be made against surrender of this Security, and payments of interest and principal on this Security shall be made, in accordance with the foregoing and subject to applicable laws and regulations, by check mailed on or before the due date for such payment to the person entitled thereto at such person's address appearing on the aforementioned register or, in the case of payments of principal and any premium to such other address as the registered holder may specify upon such surrender; <u>provided</u>, <u>however</u>, that any payments shall be made, in the case of

------

a registered holder of at least U.S.$1,000,000 aggregate principal amount of Securities, by transfer to an account denominated in U.S. dollars maintained by the payee with a bank if such registered holder so elects by giving notice to the Fiscal Agent, not less than 15 days (or such fewer days as the Fiscal Agent may accept at its discretion) prior to the date of the payments to be obtained, of such election and of the account to which payments are to be made. The Issuer covenants that until this Security has been delivered to the Fiscal Agent for cancellation, or monies sufficient to pay the principal of and interest on this Security have been made available for payment and either paid or returned to the Issuer as provided herein, it will at all times maintain offices or agencies in The City of New York and (so long as the Securities are listed on the Luxembourg Stock Exchange and such Exchange shall so require) in Luxembourg for the payment of the principal of and interest on the Securities as herein provided.

Reference is hereby made to the further provisions of this Security set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.

Unless the certificate of authentication hereon has been executed by the Fiscal Agent by manual signature, this Security shall not be valid or obligatory for any purpose.

------

IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly executed.

Dated: March 28, 2023

---

| | | | |
|:---|:---|:---|:---|
| REPUBLIC OF PANAMA | REPUBLIC OF PANAMA | REFRENDO: CONTRALORIA GENERAL DE LA REPUBLICA DE PANAMA | REFRENDO: CONTRALORIA GENERAL DE LA REPUBLICA DE PANAMA |
| By | | By | |
|  | Name: |  | Name: |
|  | Title: |  | Title: |
| Executed in: | Executed in: | Executed in: | Executed in: |

---

CERTIFICATE OF AUTHENTICATION

This is one of the Securities of the series designated therein referred to in the within-mentioned Fiscal Agency Agreement.

---

| | |
|:---|:---|
| THE BANK OF NEW YORK MELLON<br>(successor to JPMorgan Chase Bank, N.A.)<br>as Fiscal Agent | THE BANK OF NEW YORK MELLON<br>(successor to JPMorgan Chase Bank, N.A.)<br>as Fiscal Agent |
| By | |
|  | Name: |
|  | Title: |

---

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. This Security is one of a duly authorized issue of securities of the Issuer (herein called the "Securities"), issued and to be issued in one or more series in accordance with a Fiscal Agency Agreement, dated as of September 26, 1997, as amended by Amendment No. 1 thereto, dated as of September 4, 2003, by Amendment No. 2 thereto, dated as of February 13, 2015, and by Amendment No. 3, thereto, dated as of October 26, 2016, as the same may be further amended from time to time (herein called the "Fiscal Agency Agreement"), between the Issuer and The Bank of New York Mellon (successor to JPMorgan Chase Bank, N.A.), as Fiscal Agent (herein called the "Fiscal Agent", which term includes any successor fiscal agent under the Fiscal Agency Agreement), copies of which Fiscal Agency Agreement are on file and available for inspection at the corporate trust office of the Fiscal Agent in The City of New York. This Security is one of the series designated on the face hereof, which series is initially limited in aggregate principal amount to U.S.$2,300,000,000 or its equivalent in another currency or composite currency outstanding at any one time (which amount may be increased at the option of the Issuer if in the future it determines that it may wish to sell additional Securities of this Series, subject to Paragraph 15 below). The Securities are Equal Ranking Securities and Aggregated Collective Action Securities under the Fiscal Agency Agreement. Capitalized terms not otherwise defined herein shall have the meanings assigned to them in the Fiscal Agency Agreement.

The Securities are direct, unsubordinated, unconditional and general obligations of the Issuer and will rank without any preference among themselves. The Securities rank and will rank without any preference among themselves and equally with all other unsecured and unsubordinated Public Indebtedness of the Issuer. It is understood that this provision shall not be construed so as to require the Issuer to make payments under the Securities ratably with payments being made under any other Public Indebtedness. Except as provided in the next succeeding paragraph, the Securities shall be unsecured obligations of the Issuer. The full faith and credit of the Republic of Panama is pledged for the due and punctual payment of all the Securities and for the due and timely payment of all obligations of the Issuer in respect thereof.

This Security constitutes a further issuance of, and is consolidated to form a single series with, the U.S.$1,500,000,000 aggregate principal amount of the Issuer's outstanding 6.400% Global Bonds due 2035 that were previously issued on November 21, 2022.

The Issuer undertakes that so long as any Securities remain outstanding, it shall not create or permit to subsist any Lien (as defined below) upon the whole or any parts of its assets or revenues to secure any Public External Indebtedness (as defined below) upon the whole or any part of its assets or revenues to secure any Public External Indebtedness (as defined below) of the Issuer, unless, at the same time or prior thereto, the Issuer's obligations under the Securities either (i) are secured equally and ratably therewith, or (ii) have the benefit of such other security, guarantee, indemnity or other arrangement as shall be approved by the holders of the Securities (as provided in Paragraph 9 below); <u>provided</u>, <u>however</u>, that the Issuer may create or permit to subsist:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) any Lien upon property to secure Public External Indebtedness of the Issuer incurred for the purpose of financing the acquisition of such property and any renewal or extension of any such Lien which is limited to the original property covered thereby and which secures only the renewal or extension of the original secured financing;

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any Lien existing on such property at the time of its acquisitions to secure Public External Indebtedness of the Issuer and any renewal or extension of any such Lien which is limited to the original property covered thereby and which secures only the renewal or extension of the original secured financing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) any Lien in existence on the date of issue of the Securities, including any renewal or extension thereof which secures only the renewal or extension of the original secured financing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) any Lien securing Public External Indebtedness incurred for the purpose of financing all or part of the costs of the acquisition, construction or development of a project and any renewal or extension of such Lien, <u>provided</u> that (a) the holders of such Public External Indebtedness expressly agree to limit their recourse to the assets and revenues of such project, and all proceeds (including, without limitation, any insurance proceeds), products and all additions, substitutions, replacements and accessions of or to any such assets or revenues, as the principal source of repayment of such Public Indebtedness and (b) the property over which such Lien is granted consists solely of such assets and revenues and proceeds;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Liens in addition to those permitted by clauses (a) through (e) above, and any renewal or extension thereof, <u>provided</u> that the aggregate amount of Public External Indebtedness secured by such additional Liens shall not exceed the equivalent of U.S.$25,000,000.

------

For purposes of the Securities:

"Indebtedness" means any payment obligation (whether pursuant to a guarantee or otherwise), including any contingent liability, for borrowed money or arising from bonds, debentures, notes or other similar instruments;

"Lien" means any lien, pledge, mortgage, security interest, deed of trust, charge or other encumbrance or preferential arrangement which has the practical effect of constituting a security interest with respect to the payment of any obligations with or from revenues or the proceeds of any asset of any kind whether in effect on the date that the Fiscal Agency Agreement becomes effective or any time thereafter;

"Mixed Companies" means the following companies or their successors: AES Panamá, S.A.; Bahía Las Minas Corp.; Cable & Wireless Panamá, S.A.; Elektra Noreste, S.A.; Empresa de Distribución Eléctrica Chiriquí, S.A.; Empresa de Distribución Eléctrica Metro-Oeste, S.A.; Enel Fortuna, S.A.; Energía y Servicios de Panamá, S.A.; Panamá Ports Company, S.A. and Petroterminal de Panamá, S.A.;

"Public External Indebtedness" means any Public Indebtedness which is not issued pursuant to agreements or evidenced by instruments that submit the resolution of all disputes arising thereunder to the exclusive jurisdiction of the courts of the Republic; and

"Public Indebtedness" means any Indebtedness of, or guaranteed by, the Republic which (i) is publicly offered or privately placed in security markets, (ii) is in the form of, or represented by, bonds, notes or other securities or any guarantees thereof, (iii) is, or was intended at the time of issue to be, quoted, listed or traded on any stock exchange, automated trading system or over-the-counter or other securities market (including, without prejudice to the generality of the foregoing, securities eligible for sale pursuant to Rule 144A under the United States Securities Act of 1933, as amended (or any successor law or regulation of similar effect)) and (iv) has an original maturity of more than one year or is combined with a commitment so that the original maturity of one year or less may be extended at the option of the Republic to a period in excess of one year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The Securities are issuable in fully registered form. Securities are issuable in authorized denominations of U.S.$200,000 and integral multiple of U.S.$1,000 in excess thereof.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. The Issuer shall maintain in The City of New York, an office or agency where Securities may be surrendered for registration of transfer or exchange. The Issuer has initially appointed the corporate trust office of the Fiscal Agent as its agent in The City of New York for such purpose and has agreed to cause to be kept at such office a register in which, subject to such reasonable regulations as it may prescribe, the Issuer will provide for the registration of Securities and registration of transfers of Securities. In addition, the Issuer has appointed the main offices of The Bank of New York Mellon (Luxembourg) S.A. in Luxembourg as an additional agency (a "Transfer Agent") where Securities may be surrendered for registration of transfer or exchange. The Issuer reserves the right to vary or terminate the appointment of the Fiscal Agent as security registrar or of any Transfer Agent or to appoint additional or other registrars or Transfer Agents or to approve any change in the office through which any security registrar or any Transfer Agent acts, <u>provided</u> that there will at all times be a security registrar in The City of New York, and (so long as the Securities are listed on the Luxembourg Stock Exchange and such Exchange shall so require) a Transfer Agent in Luxembourg.

The transfer of a Security is registrable on the aforementioned register upon surrender of such Security at the corporate trust office of the Fiscal Agent or any Transfer Agent duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Issuer and the Fiscal Agent duly executed by, the registered holder thereof or his attorney duly authorized in writing. Upon such surrender of this Security for registration of transfer, the Issuer shall execute, and the Fiscal Agent shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Securities, dated the date of authentication thereof, of any authorized denominations and of a like aggregate principal amount.

At the option of the registered holder upon request confirmed in writing, Securities may be exchanged for Securities of any authorized denominations and of a like tenor, form and aggregate principal amount upon surrender of the Securities to be exchanged at the office of any Transfer Agent or at the corporate trust office of the Fiscal Agent. Whenever any Securities are so surrendered for exchange, the Issuer shall execute, and the Fiscal Agent shall authenticate and deliver, the Securities which the registered holder making the exchange is entitled to receive. Any registration of transfer or exchange will be effected upon the Transfer Agent or the Fiscal Agent, as the case may be, being satisfied with the documents of title and identity of the person making the request and subject to such reasonable regulations as the Issuer may from time to time agree with the Transfer Agents and the Fiscal Agent.

All Securities issued upon any registration of transfer or exchange of Securities shall be the valid obligations of the Issuer, evidencing the same debt, and entitled to the same benefits, as the Securities surrendered upon such registration of transfer or exchange. No service charge shall be made for any registration of transfer or exchange, but the Issuer may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith, other than an exchange in connection with a partial redemption of a Security not involving any registration of a transfer.

------

Prior to due presentment of this Security for registration of transfer, the Issuer, the Fiscal Agent and any agent of the Issuer or the Fiscal Agent may treat the person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security be overdue, and neither the Issuer nor the Fiscal Agent nor any such agent shall be affected by notice to the contrary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. The Issuer shall pay to the Fiscal Agent at its principal office in The City of New York, not later than 10:00 a.m. (New York City time) on the business day in New York prior to each Interest Payment Date, redemption date or Stated Maturity of the Securities, in such amounts sufficient (with any amounts then held by the Fiscal Agent and available for the purpose) to pay the interest on, and the principal of, the Securities due and payable on such Interest Payment Date, redemption date or Stated Maturity, as the case may be. The Fiscal Agent shall apply the amounts so paid to it to the payment of such interest and principal in accordance with the terms of the Securities. Any monies paid by the Issuer to the Fiscal Agent for the payment of the principal of or interest on any Securities and remaining unclaimed at the end of two years after such principal or interest shall have become due and payable (whether at maturity, redemption or otherwise) shall then be repaid to the Issuer upon its written request, and upon such repayment all liability of the Fiscal Agent with respect thereto shall cease, without, however, limiting in any way any obligation the Issuer may have to pay the principal of and interest on this Security as the same shall become due.

In any case where the due date for the payment of the principal of or interest on any Security shall be at any place of payment a day on which banking institutions are authorized or obligated by law or executive order to close, then payment of principal or interest need not be made on such date at such place but may be made on the next succeeding day at such place which is not a day on which banking institutions are authorized or obligated by law or executive order to close, with the same force and effect as if made on the date for such payment, and no interest shall accrue for the period after such date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. All payments of principal and interest in respect of the Securities shall be made without withholding or deduction for or on account of any present or future taxes, duties, assessments, or other governmental charges of whatever nature imposed or levied by the Republic or any other jurisdiction from which or through which payment is made to the holders of Securities in respect of the Securities or any political subdivision or authority thereof or therein having power to tax ("Taxes"), unless such taxing jurisdiction is compelled by law to deduct or withhold such taxes, duties, assessments, or governmental charges. In such event, the Issuer shall make such withholding, make payment of the amount so withheld to the appropriate governmental authority and forthwith pay such additional amounts ("Additional Amounts") as may be necessary to ensure that the net amounts receivable by each holder of Securities after such withholding or deduction shall equal the payment which would have been receivable by such holder in respect of such Securities in the absence of such withholding or deduction. No such Additional Amounts shall be payable:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) in respect of any Security or Coupon held by or on behalf of a holder who is liable for such Taxes by reason of such holder having some connection with the Republic otherwise than merely by the holding of such Security or by the receipt of principal, premium, if any, or interest in respect thereof; or

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) in respect of any Security held by or on behalf of a holder who is liable for such Taxes by reason of such holder's failure to comply with any reasonable certification, identification or other reporting requirement concerning the nationality, residence, identity or connection with the Republic, or any political subdivision or taxing authority thereof or therein, of such holder or the holder of any interest in such Security or rights in respect thereof, if compliance is required by the Republic, or any political subdivision or taxing authority thereof or therein, as a precondition to exemption from such deduction or withholding; <u>provided</u>, <u>however</u>, that the limitations on the Issuer's obligations to pay Additional Amounts set forth in this clause (b) shall not apply if such certification, identification, or other reporting requirement would be materially more onerous, in form, in procedure, or in substance of information disclosed by the relevant holders or beneficial owners than comparable information or other reporting requirements imposed under United States tax law, regulation and administrative practice; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) in respect of any Security held by or on behalf of a holder who is liable for such Taxes by reason of the failure of such holder to present such holder's Security for payment (where such presentation is required) within 30 calendar days after the date on which such payment thereof became due and payable or is duly provided for and notice thereof is given to the holder, whichever occurs later, except to the extent that such holder would have been entitled to Additional Amounts in respect of such Taxes on presenting such Security for payment on any date within such 30 calendar days.

The Issuer shall pay all stamp and other duties, if any, which may be imposed by the Republic, the United States or any political subdivision thereof or taxing authority of or in the foregoing with respect to the Fiscal Agency Agreement or the original issuance of this Security.

Except as specifically provided in this Security, the Issuer shall not be required to make any payment with respect to any tax, assessment or other governmental charge imposed by any government or any political subdivision or taxing authority thereof or therein. Whenever in this Security there is a reference, in any context, to the payment of the principal of or interest on, or in respect of, any Security, such mention shall be deemed to include mention of the payment of Additional Amounts to the extent that, in such context, Additional Amounts are, were or would be payable in respect thereof pursuant to the provisions of Paragraph 5 and express mention of the payment of Additional Amounts (if applicable) in any provisions hereof shall not be construed as excluding Additional Amounts in those provisions hereof where such express mention is not made.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. In the event any of the following shall occur (each an "Event of Default"):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) default in any payment of principal of or premium on any Security of this Series and the continuance of such default for a period of 15 calendar days; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) default in any payment of interest on any Security of this Series and the continuance of such default for a period of 30 calendar days; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) default in the performance of any other obligation under the Securities of this Series and the continuance of such default for a period of 60 calendar days after written notice requiring the same to be remedied shall have been given to the Fiscal Agent by the holder of any Security of this Series; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) acceleration of any aggregate principal amount of Public Indebtedness of the Republic in excess of U.S.$25,000,000 (or its equivalent in any other currency) by reason of an event of default (however described) resulting from the failure either to make any payment of principal, premium or interest thereunder when due; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) failure to make any payment in respect of Public Indebtedness of the Republic in an aggregate principal amount in excess of U.S.$25,000,000 (or its equivalent in any other currency) when due (whether at stated maturity, by acceleration or otherwise) (as such date may be extended by any applicable grace period or waiver) and the continuance of such failure for a period of 30 calendar days after written notice requiring the same to be remedied shall have been given to the Fiscal Agent by the holder of any Security of a Series; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) declaration by the Republic of a moratorium with respect to the payment of principal of, or premium or interest on Public External Indebtedness of the Republic which does not expressly exclude the Securities of this Series; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) denial or repudiation by the Republic of its obligations under the Securities of this Series;

then the registered holder of this Security may, at such holder's option so long as an Event of Default is continuing, declare the principal of and any accrued interest on all Securities of this Series to be immediately due and payable by written notice to the Issuer and the Fiscal Agent at its corporate trust office, and unless all defaults shall have been cured by the Issuer prior to receipt of such written notice, such principal and interest shall become and be immediately due and payable; <u>provided</u>, <u>however</u>, that any notice declaring the Securities of this Series due and

------

payable shall become effective only when the Fiscal Agent has received such notice from the holders of not less than 25% in aggregate principal amount of the Securities of this Series then Outstanding. If any Event of Default shall give rise to a declaration which shall be effective and all Events of Default shall cease to continue following such declaration, then such declaration may be rescinded and annulled by the affirmative vote or written consent of the holders of not less than 50% in aggregate principal amount of the Securities of this Series then Outstanding in accordance with the procedures set forth in Paragraph 9 below.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. Prior to November 14, 2034 (the "Par Call Date"), the Securities of this Series shall be redeemable, in whole or in part, at the option of the Issuer at any time and from time to time, at a redemption price (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of (1) 100% of the principal amount of the Securities being redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on the Securities being redeemed (excluding the portion of any such interest accrued to the redemption date) discounted to the redemption date (assuming the Securities matured on the Par Call Date) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as defined below), plus 40 basis points less interest accrued to the date of redemption; plus, in either case, accrued and unpaid interest thereon to the redemption date

On or after the Par Call Date, the Securities of this Series shall be redeemable, in whole or in part, at the option of the Issuer at any time and from time to time, at a redemption price equal to 100% of the principal amount of the Securities being redeemed plus accrued and unpaid interest to the date of redemption.

Notice of any redemption shall be mailed or electronically delivered (or otherwise transmitted in accordance with the depositary's procedures) at least 10 days but not more than 60 days before the redemption date to each holder of the Securities to be redeemed with a copy to the Fiscal Agent; provided, however, if the Fiscal Agent is asked to give such notice, it shall be notified in writing of such request at least five (5) days prior to the date of the giving of such notice (unless a shorter notice shall be satisfactory to the Fiscal Agent).

For purposes of the Securities:

"Treasury Rate" means, with respect to any redemption date, the yield determined by the Issuer in accordance with the following two paragraphs.

The Treasury Rate shall be determined by the Issuer after 4:15 p.m., New York City time (or after such time as yields on U.S. government securities are posted daily by the Board of Governors of the Federal Reserve System), on the third business day preceding the redemption date based upon the yield or yields for the most recent day that appear after such time on such day in the most recent statistical release published by the Board of Governors of the

------

Federal Reserve System designated as "Selected Interest Rates (Daily)—H.15" (or any successor designation or publication) ("H.15") under the caption "U.S. government securities–Treasury constant maturities–Nominal" (or any successor caption or heading). In determining the Treasury Rate, the Issuer shall select, as applicable: (1) the yield for the Treasury constant maturity on H.15 exactly equal to the period from the redemption date to Par Call Date (the "Remaining Life"); or (2) if there is no such Treasury constant maturity on H.15 exactly equal to the Remaining Life, the two yields – one yield corresponding to the Treasury constant maturity on H.15 immediately shorter than and one yield corresponding to the Treasury constant maturity on H.15 immediately longer than the Remaining Life – and shall interpolate to the Par Call Date on a straight-line basis (using the actual number of days) using such yields and rounding the result to three decimal places; or (3) if there is no such Treasury constant maturity on H.15 shorter than or longer than the Remaining Life, the yield for the single Treasury constant maturity on H.15 closest to the Remaining Life. For purposes of this paragraph, the applicable Treasury constant maturity or maturities on H.15 shall be deemed to have a maturity date equal to the relevant number of months or years, as applicable, of such Treasury constant maturity from the redemption date.

If on the third business day preceding the redemption date H.15 or any successor designation or publication is no longer published, the Issuer shall calculate the Treasury Rate based on the rate per annum equal to the semi-annual equivalent yield to maturity at 11:00 a.m., New York City time, on the second business day preceding such redemption date of the United States Treasury security maturing on, or with a maturity that is closest to, the Par Call Date, as applicable. If there is no United States Treasury security maturing on the Par Call Date but there are two or more United States Treasury securities with a maturity date equally distant from the Par Call Date, one with a maturity date preceding the Par Call Date and one with a maturity date following the Par Call Date, the Issuer shall select the United States Treasury security with a maturity date preceding the Par Call Date. If there are two or more United States Treasury securities maturing on the Par Call Date or two or more United States Treasury securities meeting the criteria of the preceding sentence, the Issuer shall select from among these two or more United States Treasury securities the United States Treasury security that is trading closest to par based upon the average of the bid and asked prices for such United States Treasury securities at 11:00 a.m., New York City time. In determining the Treasury Rate in accordance with the terms of this paragraph, the semi-annual yield to maturity of the applicable United States Treasury security shall be based upon the average of the bid and asked prices (expressed as a percentage of principal amount) at 11:00 a.m., New York City time, of such United States Treasury security, and rounded to three decimal places.

The Issuer's actions and determinations in determining the redemption price shall be conclusive and binding for all purposes, absent manifest error.

------

In the case of a partial redemption, selection of the Securities for redemption will be made pro rata, by lot or by such other method as the Fiscal Agent in its sole discretion deems appropriate and fair. No Securities of a principal amount of $200,000 or less will be redeemed in part. If any Securities is to be redeemed in part only, the notice of redemption that relates to the Securities will state the portion of the principal amount of the Securities to be redeemed. A new Security in a principal amount equal to the unredeemed portion of the Security will be issued in the name of the holder of the Security upon surrender for cancellation of the original Security. For so long as the Security are held by DTC (or another depositary), the redemption of the Security shall be done in accordance with the policies and procedures of the depositary.

Unless the Issuer defaults in payment of the redemption price, on and after the redemption date interest will cease to accrue on the Securities or portions thereof called for redemption.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. If any mutilated Security is surrendered to the Fiscal Agent, the Issuer shall execute, and the Fiscal Agent shall authenticate and deliver in exchange therefor, a new Security of like tenor and principal amount, bearing a number not contemporaneously outstanding.

If there be delivered to the Issuer and the Fiscal Agent (i) evidence to their satisfaction of the destruction, loss or theft of any Security and (ii) such security or indemnity as may be required by them to save each of them and any agent of each of them harmless, then, in the absence of notice to the Issuer or the Fiscal Agent that such Security has been acquired by a bona fide purchaser, the Issuer shall execute, and upon its request the Fiscal Agent shall authenticate and deliver in lieu of any such destroyed, lost or stolen Security a new Security of like tenor and principal amount and bearing a number not contemporaneously outstanding.

Upon the issuance of any new Security under this Paragraph 8, the Issuer may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the reasonable fees and the expenses of the Fiscal Agent) connected therewith.

Every new Security issued pursuant to this Paragraph 8 in lieu of any destroyed, lost or stolen Security, shall constitute an original additional contractual obligation of the Issuer, whether or not the destroyed, lost or stolen Security shall be at any time enforceable by anyone.

Any new Security delivered pursuant to this Paragraph 8 shall be so dated that neither gain nor loss in interest shall result from such exchange.

The provisions of this Paragraph 8 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. The Issuer and the Fiscal Agent, may without the consent of any holder of the Securities, agree to a Modification of the Securities of this Series or to the Fiscal Agency Agreement as it relates to the Securities of this Series for the purpose of: (A) adding to the covenants of the Issuer for the benefit of the holders of the Securities of this Series, (B) surrendering any right or power conferred upon the Issuer, (C) securing the Securities of this Series pursuant to the requirements of the Securities of this Series or otherwise, (D) curing any ambiguity, or curing, correcting or supplementing any defective provision hereof or (E) amending the Fiscal Agency Agreement or the Securities of this Series in any manner which the Issuer and the Fiscal Agent may determine and which shall not adversely affect the interest of any holder of Securities of this Series in any material respect (each such modification, a "Technical Modification"). Any such Technical Modification shall be binding on all holders of the Securities of this Series, and unless the Fiscal Agent otherwise requires, the Issuer shall provide notice of any such Technical Modification to the Fiscal Agent for onward distribution to such holders of the Securities of this Series as soon as practicable thereafter.

Modifications proposed by the Issuer to the terms and conditions of the Securities of this Series, or to the Fiscal Agency Agreement insofar as they affect only the Securities of this Series, that are not Reserve Matter Modifications or Technical Modifications, may be approved by holders of the Securities of this Series (by vote at a meeting of the holders of Securities of this Series or by a written consent of such holders of Securities of this Series), and future compliance therewith may be waived, with the written consent of the Issuer and the affirmative vote (if approved at a meeting of the holders of the Securities of this Series) or consent (if approved by a written action) of holders of more than 50% of the aggregate principal amount of the Outstanding Securities of this Series.

Reserve Matter Modifications proposed by the Issuer may be approved by holders of Securities of this Series (by vote at a meeting of the holders of the Securities of this Series or by a written consent of such holders) in one of three ways (each, a "Modification Method"): (A) by the holders of the Aggregated Collective Action Securities of each Series subject to the proposed Modification (a "Single Series Reserve Matter Modification"), (B) for proposed Cross-Series Modifications (as defined below) that are Uniformly Applicable (as defined below), by the holders of two or more Series of Aggregated Collective Action Securities whose votes or written consents will be aggregated for the purpose of determining whether the approval threshold has been met (a "Cross-Series Modification with Single Aggregated Voting"), and (C) for proposed Cross-Series Modifications that are not Uniformly Applicable, by the holders of two or more Series of Aggregated Collective Action Securities whose votes or written consents (x) taken together, must meet an aggregated approval threshold and (y) taken separately for each Series of Securities covered by that proposed Cross-Series Modification, must meet a separate approval threshold (a "Cross-Series Modification with Two Tier Voting"). The Issuer shall have the discretion to select a Modification Method for a proposed Reserve Matter Modification and to designate which Series of Aggregated Collective Action Securities will be included in the aggregated voting for a proposed Cross-Series Modification; <u>provided</u>, <u>however</u>, that once the Issuer selects a Modification Method and designates the Series of Aggregated Collective Action Securities that will be subject to a proposed Cross-Series Modification, those elections will be final for purposes of that vote or consent solicitation. The Issuer may simultaneously propose two or more Cross-Series Modifications, each affecting different Series of Aggregated Collective Action Securities, or one or more Cross-Series Modifications together with one or more Single Series Modifications.

------

Modifications may also be approved by holders of the Securities of this Series pursuant to a written action consented to by holders of the requisite percentage of Securities of this Series. If a proposed Modification is to be approved by a written action, the Issuer shall provide the consent solicitation to the Fiscal Agent for onward distribution to the relevant holders of the Securities to the proposed Modification not less than 10, nor more than 30, days prior to the expiration date for the receipt of such consents specified by the Issuer. If the consent solicitation relates to a proposal for a Cross-Series Modification, the solicitation shall include an indication of (x) which Series of Securities will be aggregated for purposes of consenting to that proposal and (y) the Modification Method chosen by the Issuer for the consent regarding that proposal. For consent solicitations relating to Reserve Matter Modifications, the solicitation shall also include any information required to be provided by the Issuer pursuant to Section 11(f)(i)(h) and Section 11(f)(iv) of the Fiscal Agency Agreement.

Any Modification constituting or including a Reserve Matter Modification to the terms and conditions of the Securities of this Series, or to the Fiscal Agency Agreement insofar as it affects the Securities of this Series, may be made, and future compliance therewith may be waived, with the written consent of the Issuer and the affirmative vote or consent of holders of more than 75% of the aggregate principal amount of the Outstanding Securities of this Series.

Any Cross-Series Modification constituting or including a Reserve Matter Modification that is Uniformly Applicable to the terms and conditions of the Securities of this Series and one or more Series of Aggregated Collective Action Securities, or to the Fiscal Agency Agreement insofar as it affects the Securities of this Series and one or more Series of Aggregated Collective Action Securities, may be made, and future compliance therewith may be waived, with the written consent of the Issuer and the affirmative vote or consent of holders of more than 75% of the aggregate principal amount of the Outstanding Series of Aggregated Collective Action Securities affected by the proposed Modification (taken in the aggregate).

Any Cross-Series Modification constituting or including a Reserve Matter Modification to the terms and conditions of the Securities of this Series and one or more Series of Aggregated Collective Action Securities may be made, and future compliance therewith may be waived, with the written consent of the Issuer and: (A) the affirmative vote or consent of holders of more than 66 <sup>2</sup>/<sub>3</sub>% of the aggregate principal amount of the Outstanding Securities of all the Series of Aggregated Collective Action Securities affected by that proposed Modification (taken in the aggregate), and (B) the affirmative vote or consent of holders of more than 50% of the aggregate principal amount of the Outstanding Aggregated Collective Action Securities of each Series affected by that proposed Modification (taken individually).

------

It is understood that a Cross-Series Modification constituting or including a Reserve Matter Modification to the terms and conditions of the affected Securities that is not Uniformly Applicable must be effected pursuant to the paragraph immediately preceding this paragraph; a Cross-Series Modification that is Uniformly Applicable may be effected pursuant to the paragraph immediately preceding the preceding paragraph or to the immediately preceding paragraph, at the Issuer's option.

For purposes of Securities of this Series the following terms have the definitions as follows:

"Aggregated Collective Action Securities" means any debt securities of any Series issued after February 13, 2015 that are in their terms explicitly stated to be "Aggregated Collective Action Securities".

"Cross-Series Modification" means a Modification constituting a Reserve Matter affecting two or more Series of Aggregated Collective Action Securities.

"Modification" means any modification, amendment, supplement or waiver affecting one or more Series of Aggregated Collective Action Securities, including those effected by way of exchange or conversion.

"Outstanding" for purposes of the Fiscal Agency Agreement and the Securities of any Series, any Security of such Series authenticated and delivered pursuant to the Fiscal Agency Agreement shall, as of any date of determination, be deemed to be Outstanding, except: (A) Securities theretofore cancelled by the Fiscal Agent or delivered to the Fiscal Agent for cancellation and not reissued; (B) Securities which have been called for redemption in accordance with their terms or which have become due and payable at maturity or otherwise and with respect to which monies sufficient to pay the principal thereof (and premium, if any) and any interest thereon shall have been paid or duly provided for; or (C) Securities of a Series in lieu of or in substitution for which other Securities of such Series shall have been authenticated and delivered pursuant to the Fiscal Agency Agreement; <u>provided</u>, <u>however</u>, that in determining whether the holders of the requisite principal amount of Outstanding Securities of a Series have consented to or voted in favor of any request, demand, authorization, direction, notice, consent, waiver, amendment, modification or supplement hereunder, (i) the principal amount of a Security which by its terms provides for an amount other than the stated face amount to be due and payable upon a declaration of acceleration of the maturity thereof or at the stated maturity (a "Variable Principal Security") that shall be deemed to be Outstanding shall be either (A) the amount of the principal thereof that would be due and payable as of the date of such determination upon acceleration of the maturity thereof or (B) such other amount not in excess of the stated face amount, as may be specified in such Security, (ii) the principal amount of a Security denominated in a foreign currency or currencies shall be the U.S. dollar equivalent, determined on the date of original issuance of such Security, of the principal amount (or, in the case of a Variable Principal Security, the U.S. dollar equivalent, determined on the date of

------

original issuance of such Security, of the amount determined on the date provided in (i) above) of such Security, and (iii) Securities of such Series owned, directly or indirectly, by the Issuer or Public Sector Instrumentalities thereof shall be disregarded and deemed not to be Outstanding, except that in determining whether the Fiscal Agent shall be protected in relying upon any such request, demand, authorization, direction, notice, consent, waiver, amendment, modification or supplement, only Securities that a Responsible Officer of the Fiscal Agent knows to be so owned shall be so disregarded.

"Public Sector Instrumentality" means any department, ministry or agency of the national government of the Issuer or any corporation, trust, financial institution or other entity owned or controlled by the national government of the Issuer, any political subdivision of the Issuer or any of the foregoing, and "control" means the power, directly or indirectly, through the ownership of voting securities or other ownership interests, by contract or otherwise, to direct the management of or elect or appoint a majority of the board of directors or other persons performing similar functions in lieu of or in addition to, the board of directors of a corporation, trust, financial institution or other entity.

"Reserve Matter" means any Modification to the terms and conditions of the Securities of this Series or Series of Aggregated Collective Action Securities, or to the Fiscal Agency Agreement insofar as it affects the Securities of this Series or Series of Aggregated Collective Action Securities, that would: (A) change the due date for the payment of the principal of (or premium, if any) or any installment of interest of the Securities of this Series or Series of Aggregated Collective Action Securities, (B) reduce the principal amount of the Securities of this Series or Series of Aggregated Collective Action Securities, the portion of such principal amount that is payable upon acceleration of the maturity of the Securities of this Series or Series of Aggregated Collective Action Securities, the interest rate thereon or the premium payable upon redemption thereof (C) change the coin or currency in which payment with respect to interest, premium or principal in respect of Securities of this Series or Series of Aggregated Collective Action Securities is payable or the place or places in which any such payment is required to be made, (D) shorten the period during which the Issuer is not permitted to redeem the Securities of this Series or Series of Aggregated Collective Action Securities, or permit the Issuer to redeem the Securities of this Series or Series of Aggregated Collective Action Securities, if prior to such action, the Issuer is not permitted to do so, (E) reduce the proportion of the principal amount of the Securities of this Series or Series of Aggregated Collective Action Securities, the vote or consent of the holders of which is necessary to modify, amend or supplement the Fiscal Agency Agreement or the terms and conditions of the Securities of this Series or Series of Aggregated Collective Action Securities or to make, take or give any request, demand, authorization, direction, notice, consent, waiver or other action provided hereby or thereby to be made, taken or given, (F) change the obligation of the Issuer to pay additional amounts, if any, pursuant to the Securities of this Series or Series of Aggregated Collective Action Securities, (G) change the governing law provisions of the Securities of this Series or Series of Aggregated Collective Action Securities, (H) change the Issuer's appointment of an

------

agent for the service of process, the Issuer's agreement not to raise certain defenses with respect to its sovereign immunity or the Issuer's agreement to submit to jurisdiction in respect of disputes relating to or arising under the Fiscal Agency Agreement or the Securities of this Series or Series of Aggregated Collective Action Securities, each as set forth in Section 14 of the Fiscal Agency Agreement and in the Securities of this Series or Series of Aggregated Collective Action Securities, (I) except as contemplated in clause (C) of the definition of Technical Modifications, change the ranking of the Securities of this Series or Series of Aggregated Collective Action Securities as set forth in the terms of the Securities of this Series or Series of Aggregated Collective Action Securities, (J) change the definition of "Uniformly Applicable", "Reserve Matter", "Reserve Matter Modification" or "Outstanding", (K) change the method used to calculate any amount payable on the Securities of this Series or Series of Aggregated Collective Action Securities (other than in accordance with the express terms of the Securities of this Series or Series of Aggregated Collective Action Securities and this Fiscal Agency Agreement), or (L) change the identity of the obligor under the Securities of this Series or Series of Aggregated Collective Action Securities.

"Reserve Matter Modification" is any Modification to a Reserve Matter.

"Uniformly Applicable", in the context of a proposed Cross-Series Modification, means a Modification by which holders of Securities of all Series affected by that Modification are invited to exchange, convert or substitute their Securities on the same terms for (x) the same new instruments or other consideration or (y) new instruments or other consideration from an identical menu of instruments or other consideration. It is understood that a Modification will not be considered to be Uniformly Applicable if each exchanging, converting or substituting holder of Securities of any Series affected by that Modification is not offered the same amount of consideration per amount of principal, the same amount of consideration per amount of interest accrued but unpaid and the same amount of consideration per amount of past due interest, respectively, as that offered to each other exchanging, converting or substituting holder of Securities of any Series affected by that Modification (or, where a menu of instruments or other consideration is offered, each exchanging, converting or substituting holder of Securities of any Series affected by that Modification is not offered the same amount of consideration per amount of principal, the same amount of consideration per amount of interest accrued but unpaid and the same amount of consideration per amount of past due interest, respectively, as that offered to each other exchanging, converting or substituting holder of Securities of any Series affected by that Modification electing the same option under such menu of instruments).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. No reference herein to the Fiscal Agency Agreement shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of (and premium, if any, on) and interest on this Security at the times, place and rate, and in the coin or currency, herein prescribed.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. If for the purpose of obtaining judgment in any court or from any other tribunal it is necessary to convert a sum due hereunder to the holder of this Security in one currency into another currency (the "judgment currency"), the Issuer and each such holder agree, to the fullest extent that they may effectively do so, that the rate of exchange used will be that at which in accordance with normal banking procedures such holder could purchase the first currency with such judgment currency in the city which is the principal financial center of the country of issue of the first currency on the date two business days preceding the day on which final judgment is rendered.

The obligation of the Issuer in respect of any sum payable by it to the holder of this Security shall, notwithstanding any judgment in a judgment currency other than that in which such sum is denominated in accordance with the applicable provisions herein (the "security currency"), be discharged only to the extent that on the business day following receipt by such holder of any sum adjudged to be so due in the judgment currency, such holder may in accordance with normal banking procedures purchase the security currency with the judgment currency. If the amount of the security currency so purchased is less than the sum originally due to the holder of this Security in the security currency, the Issuer agrees, as a separate and independent obligation and notwithstanding any such judgment, to indemnify such holder against such loss, and if the amount of the security currency so purchased exceeds the sum originally due to such holder, such holder agrees to remit to the Issuer such excess, <u>provided</u> that such holder shall have no obligation to remit any such excess as long as the Issuer shall have failed to pay such holder any obligations due and payable under this Security, in which case such excess may be applied to such obligations of the Issuer hereunder in accordance with the terms hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, UNITED STATES OF AMERICA WITHOUT REGARD TO THOSE PRINCIPLES OF CONFLICTS OF LAWS THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK, UNITED STATES OF AMERICA; <u>PROVIDED</u>, <u>HOWEVER</u>, THAT AUTHORIZATION AND EXECUTION OF THIS SECURITY BY THE ISSUER SHALL BE GOVERNED BY THE LAWS OF THE REPUBLIC OF PANAMA.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. The Issuer irrevocably submits to the non-exclusive jurisdiction of any New York State or federal court sitting in The City of New York and any court of competent jurisdiction sitting in the Republic of Panama, and any appellate court from any thereof, in any suit, action or proceeding arising out of or relating to the Fiscal Agency Agreement and any Security (a "Related Proceeding") and the Issuer hereby irrevocably agrees that all claims in respect of any Related Proceeding may be heard and determined in such New York State or federal court or any court of competent jurisdiction sitting in the Republic of Panama. The Issuer hereby irrevocably waives, to the fullest extent it may effectively do so, the defense of an inconvenient forum to the maintenance of any Related Proceeding and any objection to any Related Proceeding whether on the grounds of venue, residence or domicile. The Issuer hereby agrees that a final judgment in any Related Proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or any other manner provided by law.

------

The Issuer hereby appoints and agrees to maintain the person for the time being and from time to time acting as or discharging the function of Consul General of the Republic of Panama in The City of New York (the "Process Agent"), with an office on the date hereof at 244 W 54th Street, Suite 701, New York, New York, 10019, United States, as its agent to receive on behalf of the Issuer and its property service of copies of the summons and complaint and any other process which may be served in any Related Proceeding in such New York State or federal court sitting in The City of New York. The Issuer hereby agrees that such service may be made by U.S. registered mail or by delivering by hand a copy of such process to the Issuer in care of the Process Agent at the address specified above for the Process Agent (and the Issuer hereby agrees that such service will be effective upon the mailing or delivery by hand of such process to the Office of the Process Agent), and the Issuer hereby authorizes and directs the Process Agent to accept on its behalf such service. The Issuer hereby agrees that failure of the Process Agent to give notice to the Issuer, or failure of the Issuer to receive notice of such service of process, shall not affect in any way the validity of such service on the Process Agent or the Issuer. The Issuer hereby irrevocably consents to the service of any and all process in any Related Proceeding in a New York State or federal court sitting in The City of New York by sending by U.S. registered mail copies of such process to the Issuer at the Ministry of Economy and Finance (and the Issuer hereby agrees that such service will be effective seven days after mailing thereof). The Issuer hereby covenants and agrees that it shall take any and all reasonable action, including the execution and filing of any and all documents, that may be necessary to continue the designation of the Process Agent in full force and effect, and to cause the Process Agent to continue to act as such. In addition, the Issuer hereby agrees that no documents or agreements to which it is a party or to which it or its property is subject will affect the right of any party to serve legal process in any other manner permitted by law or affect the right of any party to bring any suit, action or proceeding against any other party or its property in the courts of any other jurisdiction.

To the extent that the Issuer has or hereafter may acquire any immunity (sovereign or otherwise) from jurisdiction of any court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution, execution or otherwise) with respect to itself or its property, the Issuer hereby irrevocably agrees not to claim and will irrevocably waive such immunity in respect of any Related Proceeding, and, without limiting the generality of the foregoing, the Issuer hereby agrees that such waivers shall have the fullest scope permitted under the Foreign Sovereign Immunities Act of 1976 of the United States and are intended to be irrevocable for purposes of such Act. Notwithstanding the foregoing, the execution on or attachment of revenues, assets and property of the Issuer located in the Republic through the courts of the Republic, both prior to and post-judgment, shall be subject to the provisions of Articles 1047, 1048, 1650(#14) and 1939 of the Judicial Code of the Republic of Panama.

------

Notwithstanding the foregoing, the Issuer does not consent to service of process or waive sovereign immunity with respect to actions brought against it under United States federal securities laws or any securities laws of any states of the United States, and the Issuer's appointment of the Process Agent hereunder does not extend to such actions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14. To the extent permitted by law, all claims against the Issuer for payment of principal of or premium if any, or interest on, or in respect of, the Securities (including Additional Amounts) shall be prescribed unless made within five years from the date on which such payment first became due.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15. The Issuer may, from time to time, without the consent of the holders of any Security of this Series, create and issue additional Securities having terms and conditions the same as the Securities of this Series, or the same except for the amount of the first payment of interest, which additional Securities may be consolidated and form a single series with the outstanding Securities of this Series; <u>provided</u> that such additional Securities do not have, for purposes of U.S. federal income taxation (regardless of whether any holders of such Securities are subject to the U.S. federal tax laws), a greater amount of original issue discount than the Securities of this Series have as of the date of the issue of such additional Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16. All notices to the holders of definitive Securities of this Series will be given by publishing such notices in a leading newspaper having general circulation in London and New York. All notices to the holders while the Securities of this Series are in book-entry form, will be sent to depositary or its nominee, as a holder thereof, and the depositary will communicate such notices to its participants in accordance with its standard rules. In addition, if and so long as the Securities are listed on the Luxembourg Stock Exchange and the rules of such Exchange shall so require, notices to holders of the Securities will be published in a leading newspaper with general circulation in Luxembourg or by publication on the website of the Luxembourg Stock Exchange at http://www.bourse.iu. Notice will be considered given on the date of its first publication.

\* \* \* \* \*

## Ex-99.M

**Exhibit M** 

REGISTERED GLOBAL SECURITY

CUSIP No. 698299 BV5

ISIN No. US698299BV52

Common Code: 260468006

THIS SECURITY IS A DEFINITIVE REGISTERED GLOBAL SECURITY WITHIN THE MEANING OF THE FISCAL AGENCY AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), OR A NOMINEE THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN DTC OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE FISCAL AGENCY AGREEMENT.

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC TO THE REPUBLIC OF PANAMA OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

------

THE REPUBLIC OF PANAMA

6.853% Global Bonds due 2054

---

| | |
|:---|:---|
| No. [•] | U.S.$[•] |

---

THE REPUBLIC OF PANAMA (herein called the "Issuer" or the "Republic"), for value received, hereby unconditionally promises to pay on March 28 of each year, commencing on March 28, 2052 (each, a "Principal Payment Date", and March 28, 2054, the "Stated Maturity") to CEDE & CO., or registered assigns, the principal sum of [•] (the "Principal Amount") IN UNITED STATES DOLLARS (U.S.$[•]) in three consecutive equal annual installments representing 1/3 (one third) of the Principal Amount; and to pay interest on the Principal Amount outstanding from March 28, 2023, or from the most recent Interest Payment Date to which interest has been paid or duly provided for, semi-annually in arrears on March 28 and September 28 of each year, commencing September 28, 2023 (each an "Interest Payment Date"), at the rate of 6.853% per annum, until the aggregate Principal Amount is paid or made available for payment. The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in the Fiscal Agency Agreement hereinafter referred to, be paid to the person (the "registered holder") in whose name this Security is registered at the close of business on March 13 or September 13 (whether or not a business day), as the case may be (each a "Regular Record Date"), next preceding such Interest Payment Date. Interest shall be calculated on the basis of a 360-day year, consisting of twelve 30-day months. Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the registered holder on such Regular Record Date and may either (i) be paid to the person in whose name this Security (or one or more predecessor Securities) is registered at the close of business on a special record date for the payment of such interest to be fixed by the Issuer, notice whereof shall be given to registered holders of Securities of this Series not less than 10 days prior to such special record date, or (ii) be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities of this Series may be listed, and upon such notice as may be required by such exchange.

Principal of and any premium on this Security shall be payable against surrender of this Security at the corporate trust office of the Fiscal Agent hereinafter referred to and at the offices of such other Paying Agents as the Issuer shall have appointed pursuant to the Fiscal Agency Agreement. Payment of the principal hereof and of any premium on this Security shall be made against surrender of this Security, and payments of interest and principal on this Security shall be made, in accordance with the foregoing and subject to applicable laws and regulations, by check mailed on or before the due date for such payment to the person entitled thereto at such person's address appearing on the aforementioned register or, in the case of payments of principal and any premium to such other address as the registered holder may specify upon such surrender; <u>provided</u>, <u>however</u>, that any payments shall be made, in the case of a registered holder of at least U.S.$1,000,000 aggregate principal amount of Securities, by

------

transfer to an account denominated in U.S. dollars maintained by the payee with a bank if such registered holder so elects by giving notice to the Fiscal Agent, not less than 15 days (or such fewer days as the Fiscal Agent may accept at its discretion) prior to the date of the payments to be obtained, of such election and of the account to which payments are to be made. The Issuer covenants that until this Security has been delivered to the Fiscal Agent for cancellation, or monies sufficient to pay the principal of and interest on this Security have been made available for payment and either paid or returned to the Issuer as provided herein, it will at all times maintain offices or agencies in The City of New York and (so long as the Securities are listed on the Luxembourg Stock Exchange and such Exchange shall so require) in Luxembourg for the payment of the principal of and interest on the Securities as herein provided.

Reference is hereby made to the further provisions of this Security set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.

Unless the certificate of authentication hereon has been executed by the Fiscal Agent by manual signature, this Security shall not be valid or obligatory for any purpose.

------

IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly executed.

Dated: March 28, 2023

---

| | | | |
|:---|:---|:---|:---|
| REPUBLIC OF PANAMA | REPUBLIC OF PANAMA | REFRENDO: CONTRALORIA GENERAL DE LA REPUBLICA DE PANAMA | REFRENDO: CONTRALORIA GENERAL DE LA REPUBLICA DE PANAMA |
| By | | By | |
|  | Name:  |  | Name: |
|  | Title: |  | Title: |
| Executed in:<u> </u> | Executed in:<u> </u> | Executed in:<u> </u> | Executed in:<u> </u> |

---

CERTIFICATE OF AUTHENTICATION

This is one of the Securities of the series designated therein referred to in the within-mentioned Fiscal Agency Agreement.

---

| | |
|:---|:---|
|  THE BANK OF NEW YORK MELLON<br> (successor to JPMorgan Chase Bank, N.A.) as Fiscal Agent | THE BANK OF NEW YORK MELLON<br> (successor to JPMorgan Chase Bank, N.A.) as Fiscal Agent |
|  By | |
|  | Name: |
|  | Title: |

---

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. This Security is one of a duly authorized issue of securities of the Issuer (herein called the "Securities"), issued and to be issued in one or more series in accordance with a Fiscal Agency Agreement, dated as of September 26, 1997, as amended by Amendment No. 1 thereto, dated as of September 4, 2003, by Amendment No. 2 thereto, dated as of February 13, 2015, and by Amendment No. 3, thereto, dated as of October 26, 2016, as the same may be further amended from time to time (herein called the "Fiscal Agency Agreement"), between the Issuer and The Bank of New York Mellon (successor to JPMorgan Chase Bank, N.A.), as Fiscal Agent (herein called the "Fiscal Agent", which term includes any successor fiscal agent under the Fiscal Agency Agreement), copies of which Fiscal Agency Agreement are on file and available for inspection at the corporate trust office of the Fiscal Agent in The City of New York. This Security is one of the series designated on the face hereof, which series is initially limited in aggregate principal amount to U.S.$1,000,000,000 or its equivalent in another currency or composite currency outstanding at any one time (which amount may be increased at the option of the Issuer if in the future it determines that it may wish to sell additional Securities of this Series, subject to Paragraph 15 below). The Securities are Equal Ranking Securities and Aggregated Collective Action Securities under the Fiscal Agency Agreement. Capitalized terms not otherwise defined herein shall have the meanings assigned to them in the Fiscal Agency Agreement.

The Securities are direct, unsubordinated, unconditional and general obligations of the Issuer and will rank without any preference among themselves. The Securities rank and will rank without any preference among themselves and equally with all other unsecured and unsubordinated Public Indebtedness of the Issuer. It is understood that this provision shall not be construed so as to require the Issuer to make payments under the Securities ratably with payments being made under any other Public Indebtedness. Except as provided in the next succeeding paragraph, the Securities shall be unsecured obligations of the Issuer. The full faith and credit of the Republic of Panama is pledged for the due and punctual payment of all the Securities and for the due and timely payment of all obligations of the Issuer in respect thereof.

The Issuer undertakes that so long as any Securities remain outstanding, it shall not create or permit to subsist any Lien (as defined below) upon the whole or any parts of its assets or revenues to secure any Public External Indebtedness (as defined below) upon the whole or any part of its assets or revenues to secure any Public External Indebtedness (as defined below) of the Issuer, unless, at the same time or prior thereto, the Issuer's obligations under the Securities either (i) are secured equally and ratably therewith, or (ii) have the benefit of such other security, guarantee, indemnity or other arrangement as shall be approved by the holders of the Securities (as provided in Paragraph 9 below); <u>provided</u>, <u>however</u>, that the Issuer may create or permit to subsist:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) any Lien upon property to secure Public External Indebtedness of the Issuer incurred for the purpose of financing the acquisition of such property and any renewal or extension of any such Lien which is limited to the original property covered thereby and which secures only the renewal or extension of the original secured financing;

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any Lien existing on such property at the time of its acquisitions to secure Public External Indebtedness of the Issuer and any renewal or extension of any such Lien which is limited to the original property covered thereby and which secures only the renewal or extension of the original secured financing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) any Lien in existence on the date of issue of the Securities, including any renewal or extension thereof which secures only the renewal or extension of the original secured financing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) any Lien securing Public External Indebtedness incurred for the purpose of financing all or part of the costs of the acquisition, construction or development of a project and any renewal or extension of such Lien, <u>provided</u> that (a) the holders of such Public External Indebtedness expressly agree to limit their recourse to the assets and revenues of such project, and all proceeds (including, without limitation, any insurance proceeds), products and all additions, substitutions, replacements and accessions of or to any such assets or revenues, as the principal source of repayment of such Public Indebtedness and (b) the property over which such Lien is granted consists solely of such assets and revenues and proceeds;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Liens in addition to those permitted by clauses (a) through (e) above, and any renewal or extension thereof, <u>provided</u> that the aggregate amount of Public External Indebtedness secured by such additional Liens shall not exceed the equivalent of U.S.$25,000,000.

For purposes of the Securities:

"Indebtedness" means any payment obligation (whether pursuant to a guarantee or otherwise), including any contingent liability, for borrowed money or arising from bonds, debentures, notes or other similar instruments;

------

"Lien" means any lien, pledge, mortgage, security interest, deed of trust, charge or other encumbrance or preferential arrangement which has the practical effect of constituting a security interest with respect to the payment of any obligations with or from revenues or the proceeds of any asset of any kind whether in effect on the date that the Fiscal Agency Agreement becomes effective or any time thereafter;

"Mixed Companies" means the following companies or their successors: AES Panamá, S.A.; Bahía Las Minas Corp.; Cable & Wireless Panamá, S.A.; Elektra Noreste, S.A.; Empresa de Distribución Eléctrica Chiriquí, S.A.; Empresa de Distribución Eléctrica Metro-Oeste, S.A.; Enel Fortuna, S.A.; Energía y Servicios de Panamá, S.A.; Panamá Ports Company, S.A. and Petroterminal de Panamá, S.A.;

"Public External Indebtedness" means any Public Indebtedness which is not issued pursuant to agreements or evidenced by instruments that submit the resolution of all disputes arising thereunder to the exclusive jurisdiction of the courts of the Republic; and

"Public Indebtedness" means any Indebtedness of, or guaranteed by, the Republic which (i) is publicly offered or privately placed in security markets, (ii) is in the form of, or represented by, bonds, notes or other securities or any guarantees thereof, (iii) is, or was intended at the time of issue to be, quoted, listed or traded on any stock exchange, automated trading system or over-the-counter or other securities market (including, without prejudice to the generality of the foregoing, securities eligible for sale pursuant to Rule 144A under the United States Securities Act of 1933, as amended (or any successor law or regulation of similar effect)) and (iv) has an original maturity of more than one year or is combined with a commitment so that the original maturity of one year or less may be extended at the option of the Republic to a period in excess of one year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The Securities are issuable in fully registered form. Securities are issuable in authorized denominations of U.S.$200,000 and integral multiple of U.S.$1,000 in excess thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. The Issuer shall maintain in The City of New York, an office or agency where Securities may be surrendered for registration of transfer or exchange. The Issuer has initially appointed the corporate trust office of the Fiscal Agent as its agent in The City of New York for such purpose and has agreed to cause to be kept at such office a register in which, subject to such reasonable regulations as it may prescribe, the Issuer will provide for the registration of Securities and registration of transfers of Securities. In addition, the Issuer has appointed the main offices of The Bank of New York Mellon (Luxembourg) S.A. in Luxembourg as an additional agency (a "Transfer Agent") where Securities may be surrendered for registration of transfer or exchange. The Issuer reserves the right to vary or terminate the appointment of the Fiscal Agent as security registrar or of any Transfer Agent or to appoint additional or other registrars or Transfer Agents or to approve any change in the office through which any security registrar or any Transfer Agent acts, <u>provided</u> that there will at all times be a security registrar in The City of New York, and (so long as the Securities are listed on the Luxembourg Stock Exchange and such Exchange shall so require) a Transfer Agent in Luxembourg.

------

The transfer of a Security is registrable on the aforementioned register upon surrender of such Security at the corporate trust office of the Fiscal Agent or any Transfer Agent duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Issuer and the Fiscal Agent duly executed by, the registered holder thereof or his attorney duly authorized in writing. Upon such surrender of this Security for registration of transfer, the Issuer shall execute, and the Fiscal Agent shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Securities, dated the date of authentication thereof, of any authorized denominations and of a like aggregate principal amount.

At the option of the registered holder upon request confirmed in writing, Securities may be exchanged for Securities of any authorized denominations and of a like tenor, form and aggregate principal amount upon surrender of the Securities to be exchanged at the office of any Transfer Agent or at the corporate trust office of the Fiscal Agent. Whenever any Securities are so surrendered for exchange, the Issuer shall execute, and the Fiscal Agent shall authenticate and deliver, the Securities which the registered holder making the exchange is entitled to receive. Any registration of transfer or exchange will be effected upon the Transfer Agent or the Fiscal Agent, as the case may be, being satisfied with the documents of title and identity of the person making the request and subject to such reasonable regulations as the Issuer may from time to time agree with the Transfer Agents and the Fiscal Agent.

All Securities issued upon any registration of transfer or exchange of Securities shall be the valid obligations of the Issuer, evidencing the same debt, and entitled to the same benefits, as the Securities surrendered upon such registration of transfer or exchange. No service charge shall be made for any registration of transfer or exchange, but the Issuer may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith, other than an exchange in connection with a partial redemption of a Security not involving any registration of a transfer.

Prior to due presentment of this Security for registration of transfer, the Issuer, the Fiscal Agent and any agent of the Issuer or the Fiscal Agent may treat the person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security be overdue, and neither the Issuer nor the Fiscal Agent nor any such agent shall be affected by notice to the contrary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. The Issuer shall pay to the Fiscal Agent at its principal office in The City of New York, not later than 10:00 a.m. (New York City time) on the business day in New York prior to each Interest Payment Date, redemption date or Principal Payment Date of the Securities, in such amounts sufficient (with any amounts then held by the Fiscal Agent and available for the purpose) to pay the interest on, and the principal of, the Securities due and payable on such Interest Payment Date, redemption date or Principal Payment Date, as the case may be. The Fiscal Agent shall apply the amounts so paid to it to the payment of such interest and principal in accordance with the terms of the Securities. Any monies paid by the Issuer to the Fiscal Agent

------

for the payment of the principal of or interest on any Securities and remaining unclaimed at the end of two years after such principal or interest shall have become due and payable (whether at maturity, redemption or otherwise) shall then be repaid to the Issuer upon its written request, and upon such repayment all liability of the Fiscal Agent with respect thereto shall cease, without, however, limiting in any way any obligation the Issuer may have to pay the principal of and interest on this Security as the same shall become due.

In any case where the due date for the payment of the principal of or interest on any Security shall be at any place of payment a day on which banking institutions are authorized or obligated by law or executive order to close, then payment of principal or interest need not be made on such date at such place but may be made on the next succeeding day at such place which is not a day on which banking institutions are authorized or obligated by law or executive order to close, with the same force and effect as if made on the date for such payment, and no interest shall accrue for the period after such date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. All payments of principal and interest in respect of the Securities shall be made without withholding or deduction for or on account of any present or future taxes, duties, assessments, or other governmental charges of whatever nature imposed or levied by the Republic or any other jurisdiction from which or through which payment is made to the holders of Securities in respect of the Securities or any political subdivision or authority thereof or therein having power to tax ("Taxes"), unless such taxing jurisdiction is compelled by law to deduct or withhold such taxes, duties, assessments, or governmental charges. In such event, the Issuer shall make such withholding, make payment of the amount so withheld to the appropriate governmental authority and forthwith pay such additional amounts ("Additional Amounts") as may be necessary to ensure that the net amounts receivable by each holder of Securities after such withholding or deduction shall equal the payment which would have been receivable by such holder in respect of such Securities in the absence of such withholding or deduction. No such Additional Amounts shall be payable:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) in respect of any Security or Coupon held by or on behalf of a holder who is liable for such Taxes by reason of such holder having some connection with the Republic otherwise than merely by the holding of such Security or by the receipt of principal, premium, if any, or interest in respect thereof; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) in respect of any Security held by or on behalf of a holder who is liable for such Taxes by reason of such holder's failure to comply with any reasonable certification, identification or other reporting requirement concerning the nationality, residence, identity or connection with the Republic, or any political subdivision or taxing authority thereof or therein, of such holder or the holder of any interest in such Security or rights in respect thereof, if compliance is required by the Republic, or any political subdivision or taxing authority thereof or therein, as a precondition to exemption from such deduction or withholding; <u>provided</u>, <u>however</u>, that the limitations on the Issuer's obligations to pay Additional Amounts set forth in this clause (b) shall not apply if such certification, identification, or other reporting requirement would be materially more onerous, in form, in procedure, or in substance of information disclosed by the relevant holders or beneficial owners than comparable information or other reporting requirements imposed under United States tax law, regulation and administrative practice; or

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) in respect of any Security held by or on behalf of a holder who is liable for such Taxes by reason of the failure of such holder to present such holder's Security for payment (where such presentation is required) within 30 calendar days after the date on which such payment thereof became due and payable or is duly provided for and notice thereof is given to the holder, whichever occurs later, except to the extent that such holder would have been entitled to Additional Amounts in respect of such Taxes on presenting such Security for payment on any date within such 30 calendar days.

The Issuer shall pay all stamp and other duties, if any, which may be imposed by the Republic, the United States or any political subdivision thereof or taxing authority of or in the foregoing with respect to the Fiscal Agency Agreement or the original issuance of this Security.

Except as specifically provided in this Security, the Issuer shall not be required to make any payment with respect to any tax, assessment or other governmental charge imposed by any government or any political subdivision or taxing authority thereof or therein. Whenever in this Security there is a reference, in any context, to the payment of the principal of or interest on, or in respect of, any Security, such mention shall be deemed to include mention of the payment of Additional Amounts to the extent that, in such context, Additional Amounts are, were or would be payable in respect thereof pursuant to the provisions of Paragraph 5 and express mention of the payment of Additional Amounts (if applicable) in any provisions hereof shall not be construed as excluding Additional Amounts in those provisions hereof where such express mention is not made.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. In the event any of the following shall occur (each an "Event of Default"):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) default in any payment of principal of or premium on any Security of this Series and the continuance of such default for a period of 15 calendar days; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) default in any payment of interest on any Security of this Series and the continuance of such default for a period of 30 calendar days; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) default in the performance of any other obligation under the Securities of this Series and the continuance of such default for a period of 60 calendar days after written notice requiring the same to be remedied shall have been given to the Fiscal Agent by the holder of any Security of this Series; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) acceleration of any aggregate principal amount of Public Indebtedness of the Republic in excess of U.S.$25,000,000 (or its equivalent in any other currency) by reason of an event of default (however described) resulting from the failure either to make any payment of principal, premium or interest thereunder when due; or

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) failure to make any payment in respect of Public Indebtedness of the Republic in an aggregate principal amount in excess of U.S.$25,000,000 (or its equivalent in any other currency) when due (whether at stated maturity, by acceleration or otherwise) (as such date may be extended by any applicable grace period or waiver) and the continuance of such failure for a period of 30 calendar days after written notice requiring the same to be remedied shall have been given to the Fiscal Agent by the holder of any Security of a Series; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) declaration by the Republic of a moratorium with respect to the payment of principal of, or premium or interest on Public External Indebtedness of the Republic which does not expressly exclude the Securities of this Series; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) denial or repudiation by the Republic of its obligations under the Securities of this Series;

then the registered holder of this Security may, at such holder's option so long as an Event of Default is continuing, declare the principal of and any accrued interest on all Securities of this Series to be immediately due and payable by written notice to the Issuer and the Fiscal Agent at its corporate trust office, and unless all defaults shall have been cured by the Issuer prior to receipt of such written notice, such principal and interest shall become and be immediately due and payable; <u>provided</u>, <u>however</u>, that any notice declaring the Securities of this Series due and payable shall become effective only when the Fiscal Agent has received such notice from the holders of not less than 25% in aggregate principal amount of the Securities of this Series then Outstanding. If any Event of Default shall give rise to a declaration which shall be effective and all Events of Default shall cease to continue following such declaration, then such declaration may be rescinded and annulled by the affirmative vote or written consent of the holders of not less than 50% in aggregate principal amount of the Securities of this Series then Outstanding in accordance with the procedures set forth in Paragraph 9 below.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. Prior to September 28, 2053 (the "Par Call Date"), the Securities of this Series shall be redeemable, in whole or in part, at the option of the Issuer at any time and from time to time, at a redemption price (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of (1) 100% of the principal amount of the Securities being redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on the Securities being redeemed (excluding the portion of any such interest accrued to the redemption date) discounted to the redemption date (assuming the Securities matured on the Par Call Date) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as defined below), plus 50 basis points less interest accrued to the date of redemption; plus, in either case, accrued and unpaid interest thereon to the redemption date.

------

On or after the Par Call Date, the Securities of this Series shall be redeemable, in whole or in part, at the option of the Issuer at any time and from time to time, at a redemption price equal to 100% of the principal amount of the Securities being redeemed plus accrued and unpaid interest to the date of redemption.

Notice of any redemption shall be mailed or electronically delivered (or otherwise transmitted in accordance with the depositary's procedures) at least 10 days but not more than 60 days before the redemption date to each holder of the Securities to be redeemed with a copy to the Fiscal Agent; provided, however, if the Fiscal Agent is asked to give such notice, it shall be notified in writing of such request at least five (5) days prior to the date of the giving of such notice (unless a shorter notice shall be satisfactory to the Fiscal Agent).

For purposes of the Securities:

"Treasury Rate" means, with respect to any redemption date, the yield determined by the Issuer in accordance with the following two paragraphs.

The Treasury Rate shall be determined by the Issuer after 4:15 p.m., New York City time (or after such time as yields on U.S. government securities are posted daily by the Board of Governors of the Federal Reserve System), on the third business day preceding the redemption date based upon the yield or yields for the most recent day that appear after such time on such day in the most recent statistical release published by the Board of Governors of the Federal Reserve System designated as "Selected Interest Rates (Daily)—H.15" (or any successor designation or publication) ("H.15") under the caption "U.S. government securities–Treasury constant maturities–Nominal" (or any successor caption or heading). In determining the Treasury Rate, the Issuer shall select, as applicable: (1) the yield for the Treasury constant maturity on H.15 exactly equal to the period (the "Remaining Life") from the redemption date to the date that reflects the remaining Weighted Average Life of the Securities (assuming the last amortization payment on the Securities is made on the Par Call Date) (the "WAL Date"); or (2) if there is no such Treasury constant maturity on H.15 exactly equal to the Remaining Life, the two yields – one yield corresponding to the Treasury constant maturity on H.15 immediately shorter than and one yield corresponding to the Treasury constant maturity on H.15 immediately longer than the Remaining Life – and shall interpolate to the WAL Date on a straight-line basis (using the actual number of days) using such yields and rounding the result to three decimal places; or (3) if there is no such Treasury constant maturity on H.15 shorter than or longer than the Remaining Life, the yield for the single Treasury constant maturity on H.15 closest to the Remaining Life. For purposes of this paragraph, the applicable Treasury constant maturity or maturities on H.15 shall be deemed to have a maturity date equal to the relevant number of months or years, as applicable, of such Treasury constant maturity from the redemption date.

------

If on the third business day preceding the redemption date H.15 or any successor designation or publication is no longer published, the Issuer shall calculate the Treasury Rate based on the rate per annum equal to the semi-annual equivalent yield to maturity at 11:00 a.m., New York City time, on the second business day preceding such redemption date of the United States Treasury security maturing on, or with a maturity that is closest to, the WAL Date, as applicable. If there is no United States Treasury security maturing on the WAL Date but there are two or more United States Treasury securities with a maturity date equally distant from the WAL Date, one with a maturity date preceding the WAL Date and one with a maturity date following the WAL Date, the Issuer shall select the United States Treasury security with a maturity date preceding the WAL Date. If there are two or more United States Treasury securities maturing on the WAL Date or two or more United States Treasury securities meeting the criteria of the preceding sentence, the Issuer shall select from among these two or more United States Treasury securities the United States Treasury security that is trading closest to par based upon the average of the bid and asked prices for such United States Treasury securities at 11:00 a.m., New York City time. In determining the Treasury Rate in accordance with the terms of this paragraph, the semi-annual yield to maturity of the applicable United States Treasury security shall be based upon the average of the bid and asked prices (expressed as a percentage of principal amount) at 11:00 a.m., New York City time, of such United States Treasury security, and rounded to three decimal places.

"Weighted Average Life" at any date means the number of years obtained by dividing: (1) the sum of the products obtained by multiplying (a) the amount of each then remaining installment in respect of the Securities, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such installment payment; by (2) the then outstanding principal amount of the Securities.

The Issuer's actions and determinations in determining the redemption price shall be conclusive and binding for all purposes, absent manifest error.

In the case of a partial redemption, selection of the Securities for redemption will be made pro rata, by lot or by such other method as the Fiscal Agent in its sole discretion deems appropriate and fair. No Securities of a principal amount of $200,000 or less will be redeemed in part. If any Securities is to be redeemed in part only, the notice of redemption that relates to the Securities will state the portion of the principal amount of the Securities to be redeemed. A new Security in a principal amount equal to the unredeemed portion of the Security will be issued in the name of the holder of the Security upon surrender for cancellation of the original Security. For so long as the Security are held by DTC (or another depositary), the redemption of the Security shall be done in accordance with the policies and procedures of the depositary.

Unless the Issuer defaults in payment of the redemption price, on and after the redemption date interest will cease to accrue on the Securities or portions thereof called for redemption.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. If any mutilated Security is surrendered to the Fiscal Agent, the Issuer shall execute, and the Fiscal Agent shall authenticate and deliver in exchange therefor, a new Security of like tenor and principal amount, bearing a number not contemporaneously outstanding.

------

If there be delivered to the Issuer and the Fiscal Agent (i) evidence to their satisfaction of the destruction, loss or theft of any Security and (ii) such security or indemnity as may be required by them to save each of them and any agent of each of them harmless, then, in the absence of notice to the Issuer or the Fiscal Agent that such Security has been acquired by a bona fide purchaser, the Issuer shall execute, and upon its request the Fiscal Agent shall authenticate and deliver in lieu of any such destroyed, lost or stolen Security a new Security of like tenor and principal amount and bearing a number not contemporaneously outstanding.

Upon the issuance of any new Security under this Paragraph 8, the Issuer may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the reasonable fees and the expenses of the Fiscal Agent) connected therewith.

Every new Security issued pursuant to this Paragraph 8 in lieu of any destroyed, lost or stolen Security, shall constitute an original additional contractual obligation of the Issuer, whether or not the destroyed, lost or stolen Security shall be at any time enforceable by anyone.

Any new Security delivered pursuant to this Paragraph 8 shall be so dated that neither gain nor loss in interest shall result from such exchange.

The provisions of this Paragraph 8 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. The Issuer and the Fiscal Agent, may without the consent of any holder of the Securities, agree to a Modification of the Securities of this Series or to the Fiscal Agency Agreement as it relates to the Securities of this Series for the purpose of: (A) adding to the covenants of the Issuer for the benefit of the holders of the Securities of this Series, (B) surrendering any right or power conferred upon the Issuer, (C) securing the Securities of this Series pursuant to the requirements of the Securities of this Series or otherwise, (D) curing any ambiguity, or curing, correcting or supplementing any defective provision hereof or (E) amending the Fiscal Agency Agreement or the Securities of this Series in any manner which the Issuer and the Fiscal Agent may determine and which shall not adversely affect the interest of any holder of Securities of this Series in any material respect (each such modification, a "Technical Modification"). Any such Technical Modification shall be binding on all holders of the Securities of this Series, and unless the Fiscal Agent otherwise requires, the Issuer shall provide notice of any such Technical Modification to the Fiscal Agent for onward distribution to such holders of the Securities of this Series as soon as practicable thereafter.

Modifications proposed by the Issuer to the terms and conditions of the Securities of this Series, or to the Fiscal Agency Agreement insofar as they affect only the Securities of this Series, that are not Reserve Matter Modifications or Technical Modifications, may be approved by holders of the Securities of this Series (by vote at a meeting of the holders of Securities of this Series or by a written consent of such holders of Securities of this Series), and future compliance therewith may be waived, with the written consent of the Issuer and the affirmative vote (if approved at a meeting of the holders of the Securities of this Series) or consent (if approved by a written action) of holders of more than 50% of the aggregate principal amount of the Outstanding Securities of this Series.

------

Reserve Matter Modifications proposed by the Issuer may be approved by holders of Securities of this Series (by vote at a meeting of the holders of the Securities of this Series or by a written consent of such holders) in one of three ways (each, a "Modification Method"): (A) by the holders of the Aggregated Collective Action Securities of each Series subject to the proposed Modification (a "Single Series Reserve Matter Modification"), (B) for proposed Cross-Series Modifications (as defined below) that are Uniformly Applicable (as defined below), by the holders of two or more Series of Aggregated Collective Action Securities whose votes or written consents will be aggregated for the purpose of determining whether the approval threshold has been met (a "Cross-Series Modification with Single Aggregated Voting"), and (C) for proposed Cross-Series Modifications that are not Uniformly Applicable, by the holders of two or more Series of Aggregated Collective Action Securities whose votes or written consents (x) taken together, must meet an aggregated approval threshold and (y) taken separately for each Series of Securities covered by that proposed Cross-Series Modification, must meet a separate approval threshold (a "Cross-Series Modification with Two Tier Voting"). The Issuer shall have the discretion to select a Modification Method for a proposed Reserve Matter Modification and to designate which Series of Aggregated Collective Action Securities will be included in the aggregated voting for a proposed Cross-Series Modification; <u>provided</u>, <u>however</u>, that once the Issuer selects a Modification Method and designates the Series of Aggregated Collective Action Securities that will be subject to a proposed Cross-Series Modification, those elections will be final for purposes of that vote or consent solicitation. The Issuer may simultaneously propose two or more Cross-Series Modifications, each affecting different Series of Aggregated Collective Action Securities, or one or more Cross-Series Modifications together with one or more Single Series Modifications.

Modifications may also be approved by holders of the Securities of this Series pursuant to a written action consented to by holders of the requisite percentage of Securities of this Series. If a proposed Modification is to be approved by a written action, the Issuer shall provide the consent solicitation to the Fiscal Agent for onward distribution to the relevant holders of the Securities to the proposed Modification not less than 10, nor more than 30, days prior to the expiration date for the receipt of such consents specified by the Issuer. If the consent solicitation relates to a proposal for a Cross-Series Modification, the solicitation shall include an indication of (x) which Series of Securities will be aggregated for purposes of consenting to that proposal and (y) the Modification Method chosen by the Issuer for the consent regarding that proposal. For consent solicitations relating to Reserve Matter Modifications, the solicitation shall also include any information required to be provided by the Issuer pursuant to Section 11(f)(i)(h) and Section 11(f)(iv) of the Fiscal Agency Agreement.

Any Modification constituting or including a Reserve Matter Modification to the terms and conditions of the Securities of this Series, or to the Fiscal Agency Agreement insofar as it affects the Securities of this Series, may be made, and future compliance therewith may be waived, with the written consent of the Issuer and the affirmative vote or consent of holders of more than 75% of the aggregate principal amount of the Outstanding Securities of this Series.

------

Any Cross-Series Modification constituting or including a Reserve Matter Modification that is Uniformly Applicable to the terms and conditions of the Securities of this Series and one or more Series of Aggregated Collective Action Securities, or to the Fiscal Agency Agreement insofar as it affects the Securities of this Series and one or more Series of Aggregated Collective Action Securities, may be made, and future compliance therewith may be waived, with the written consent of the Issuer and the affirmative vote or consent of holders of more than 75% of the aggregate principal amount of the Outstanding Series of Aggregated Collective Action Securities affected by the proposed Modification (taken in the aggregate).

Any Cross-Series Modification constituting or including a Reserve Matter Modification to the terms and conditions of the Securities of this Series and one or more Series of Aggregated Collective Action Securities may be made, and future compliance therewith may be waived, with the written consent of the Issuer and: (A) the affirmative vote or consent of holders of more than 66 <sup>2</sup>/<sub>3</sub>% of the aggregate principal amount of the Outstanding Securities of all the Series of Aggregated Collective Action Securities affected by that proposed Modification (taken in the aggregate), and (B) the affirmative vote or consent of holders of more than 50% of the aggregate principal amount of the Outstanding Aggregated Collective Action Securities of each Series affected by that proposed Modification (taken individually).

It is understood that a Cross-Series Modification constituting or including a Reserve Matter Modification to the terms and conditions of the affected Securities that is not Uniformly Applicable must be effected pursuant to the paragraph immediately preceding this paragraph; a Cross-Series Modification that is Uniformly Applicable may be effected pursuant to the paragraph immediately preceding the preceding paragraph or to the immediately preceding paragraph, at the Issuer's option.

For purposes of Securities of this Series the following terms have the definitions as follows:

"Aggregated Collective Action Securities" means any debt securities of any Series issued after February 13, 2015 that are in their terms explicitly stated to be "Aggregated Collective Action Securities".

"Cross-Series Modification" means a Modification constituting a Reserve Matter affecting two or more Series of Aggregated Collective Action Securities.

"Modification" means any modification, amendment, supplement or waiver affecting one or more Series of Aggregated Collective Action Securities, including those effected by way of exchange or conversion.

"Outstanding" for purposes of the Fiscal Agency Agreement and the Securities of any Series, any Security of such Series authenticated and delivered pursuant to the Fiscal Agency Agreement shall, as of any date of determination, be deemed to be Outstanding, except: (A) Securities theretofore cancelled by the Fiscal Agent or delivered to the Fiscal Agent for cancellation and not reissued; (B) Securities which have been called for redemption in

------

accordance with their terms or which have become due and payable at maturity or otherwise and with respect to which monies sufficient to pay the principal thereof (and premium, if any) and any interest thereon shall have been paid or duly provided for; or (C) Securities of a Series in lieu of or in substitution for which other Securities of such Series shall have been authenticated and delivered pursuant to the Fiscal Agency Agreement; <u>provided</u>, <u>however</u>, that in determining whether the holders of the requisite principal amount of Outstanding Securities of a Series have consented to or voted in favor of any request, demand, authorization, direction, notice, consent, waiver, amendment, modification or supplement hereunder, (i) the principal amount of a Security which by its terms provides for an amount other than the stated face amount to be due and payable upon a declaration of acceleration of the maturity thereof or at the stated maturity (a "Variable Principal Security") that shall be deemed to be Outstanding shall be either (A) the amount of the principal thereof that would be due and payable as of the date of such determination upon acceleration of the maturity thereof or (B) such other amount not in excess of the stated face amount, as may be specified in such Security, (ii) the principal amount of a Security denominated in a foreign currency or currencies shall be the U.S. dollar equivalent, determined on the date of original issuance of such Security, of the principal amount (or, in the case of a Variable Principal Security, the U.S. dollar equivalent, determined on the date of original issuance of such Security, of the amount determined on the date provided in (i) above) of such Security, and (iii) Securities of such Series owned, directly or indirectly, by the Issuer or Public Sector Instrumentalities thereof shall be disregarded and deemed not to be Outstanding, except that in determining whether the Fiscal Agent shall be protected in relying upon any such request, demand, authorization, direction, notice, consent, waiver, amendment, modification or supplement, only Securities that a Responsible Officer of the Fiscal Agent knows to be so owned shall be so disregarded.

"Public Sector Instrumentality" means any department, ministry or agency of the national government of the Issuer or any corporation, trust, financial institution or other entity owned or controlled by the national government of the Issuer, any political subdivision of the Issuer or any of the foregoing, and "control" means the power, directly or indirectly, through the ownership of voting securities or other ownership interests, by contract or otherwise, to direct the management of or elect or appoint a majority of the board of directors or other persons performing similar functions in lieu of or in addition to, the board of directors of a corporation, trust, financial institution or other entity.

"Reserve Matter" means any Modification to the terms and conditions of the Securities of this Series or Series of Aggregated Collective Action Securities, or to the Fiscal Agency Agreement insofar as it affects the Securities of this Series or Series of Aggregated Collective Action Securities, that would: (A) change the due date for the payment of the principal of (or premium, if any) or any installment of interest of the Securities of this Series or Series of Aggregated Collective Action Securities, (B) reduce the principal amount of the Securities of this Series or Series of Aggregated Collective Action Securities, the portion of such principal amount that is payable upon acceleration of the maturity of the Securities of this Series or Series of Aggregated Collective Action Securities, the interest rate thereon or the premium payable upon redemption thereof (C) change the coin or currency in which payment with respect to interest, premium or principal in respect of Securities of this Series or Series of Aggregated

------

Collective Action Securities is payable or the place or places in which any such payment is required to be made, (D) shorten the period during which the Issuer is not permitted to redeem the Securities of this Series or Series of Aggregated Collective Action Securities, or permit the Issuer to redeem the Securities of this Series or Series of Aggregated Collective Action Securities, if prior to such action, the Issuer is not permitted to do so, (E) reduce the proportion of the principal amount of the Securities of this Series or Series of Aggregated Collective Action Securities, the vote or consent of the holders of which is necessary to modify, amend or supplement the Fiscal Agency Agreement or the terms and conditions of the Securities of this Series or Series of Aggregated Collective Action Securities or to make, take or give any request, demand, authorization, direction, notice, consent, waiver or other action provided hereby or thereby to be made, taken or given, (F) change the obligation of the Issuer to pay additional amounts, if any, pursuant to the Securities of this Series or Series of Aggregated Collective Action Securities, (G) change the governing law provisions of the Securities of this Series or Series of Aggregated Collective Action Securities, (H) change the Issuer's appointment of an agent for the service of process, the Issuer's agreement not to raise certain defenses with respect to its sovereign immunity or the Issuer's agreement to submit to jurisdiction in respect of disputes relating to or arising under the Fiscal Agency Agreement or the Securities of this Series or Series of Aggregated Collective Action Securities, each as set forth in Section 14 of the Fiscal Agency Agreement and in the Securities of this Series or Series of Aggregated Collective Action Securities, (I) except as contemplated in clause (C) of the definition of Technical Modifications, change the ranking of the Securities of this Series or Series of Aggregated Collective Action Securities as set forth in the terms of the Securities of this Series or Series of Aggregated Collective Action Securities, (J) change the definition of "Uniformly Applicable", "Reserve Matter", "Reserve Matter Modification" or "Outstanding", (K) change the method used to calculate any amount payable on the Securities of this Series or Series of Aggregated Collective Action Securities (other than in accordance with the express terms of the Securities of this Series or Series of Aggregated Collective Action Securities and this Fiscal Agency Agreement), or (L) change the identity of the obligor under the Securities of this Series or Series of Aggregated Collective Action Securities.

"Reserve Matter Modification" is any Modification to a Reserve Matter.

"Uniformly Applicable", in the context of a proposed Cross-Series Modification, means a Modification by which holders of Securities of all Series affected by that Modification are invited to exchange, convert or substitute their Securities on the same terms for (x) the same new instruments or other consideration or (y) new instruments or other consideration from an identical menu of instruments or other consideration. It is understood that a Modification will not be considered to be Uniformly Applicable if each exchanging, converting or substituting holder of Securities of any Series affected by that Modification is not offered the same amount of consideration per amount of principal, the same amount of consideration per amount of interest accrued but unpaid and the same amount of consideration per amount of past due interest, respectively, as that offered to each other exchanging, converting or substituting holder of Securities of any Series affected by that Modification (or, where a menu of instruments or other consideration is offered, each exchanging, converting or substituting holder of Securities of any Series affected by that Modification is not offered the same amount of consideration per amount of principal, the same amount of consideration per amount of interest accrued but unpaid and the same amount of consideration per amount of past due interest, respectively, as that offered to each other exchanging, converting or substituting holder of Securities of any Series affected by that Modification electing the same option under such menu of instruments).

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. No reference herein to the Fiscal Agency Agreement shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of (and premium, if any, on) and interest on this Security at the times, place and rate, and in the coin or currency, herein prescribed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. If for the purpose of obtaining judgment in any court or from any other tribunal it is necessary to convert a sum due hereunder to the holder of this Security in one currency into another currency (the "judgment currency"), the Issuer and each such holder agree, to the fullest extent that they may effectively do so, that the rate of exchange used will be that at which in accordance with normal banking procedures such holder could purchase the first currency with such judgment currency in the city which is the principal financial center of the country of issue of the first currency on the date two business days preceding the day on which final judgment is rendered.

The obligation of the Issuer in respect of any sum payable by it to the holder of this Security shall, notwithstanding any judgment in a judgment currency other than that in which such sum is denominated in accordance with the applicable provisions herein (the "security currency"), be discharged only to the extent that on the business day following receipt by such holder of any sum adjudged to be so due in the judgment currency, such holder may in accordance with normal banking procedures purchase the security currency with the judgment currency. If the amount of the security currency so purchased is less than the sum originally due to the holder of this Security in the security currency, the Issuer agrees, as a separate and independent obligation and notwithstanding any such judgment, to indemnify such holder against such loss, and if the amount of the security currency so purchased exceeds the sum originally due to such holder, such holder agrees to remit to the Issuer such excess, <u>provided</u> that such holder shall have no obligation to remit any such excess as long as the Issuer shall have failed to pay such holder any obligations due and payable under this Security, in which case such excess may be applied to such obligations of the Issuer hereunder in accordance with the terms hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, UNITED STATES OF AMERICA WITHOUT REGARD TO THOSE PRINCIPLES OF CONFLICTS OF LAWS THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK, UNITED STATES OF AMERICA; <u>PROVIDED</u>, <u>HOWEVER</u>, THAT AUTHORIZATION AND EXECUTION OF THIS SECURITY BY THE ISSUER SHALL BE GOVERNED BY THE LAWS OF THE REPUBLIC OF PANAMA.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. The Issuer irrevocably submits to the non-exclusive jurisdiction of any New York State or federal court sitting in The City of New York and any court of competent jurisdiction sitting in the Republic of Panama, and any appellate court from any thereof, in any suit, action or proceeding arising out of or relating to the Fiscal Agency Agreement and any Security (a "Related Proceeding") and the Issuer hereby irrevocably agrees that all claims in respect of any Related Proceeding may be heard and determined in such New York State or federal court or any court of competent jurisdiction sitting in the Republic of Panama. The Issuer hereby irrevocably waives, to the fullest extent it may effectively do so, the defense of an inconvenient forum to the maintenance of any Related Proceeding and any objection to any Related Proceeding whether on the grounds of venue, residence or domicile. The Issuer hereby agrees that a final judgment in any Related Proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or any other manner provided by law.

The Issuer hereby appoints and agrees to maintain the person for the time being and from time to time acting as or discharging the function of Consul General of the Republic of Panama in The City of New York (the "Process Agent"), with an office on the date hereof at 244 W 54th Street, Suite 701, New York, New York, 10019, United States, as its agent to receive on behalf of the Issuer and its property service of copies of the summons and complaint and any other process which may be served in any Related Proceeding in such New York State or federal court sitting in The City of New York. The Issuer hereby agrees that such service may be made by U.S. registered mail or by delivering by hand a copy of such process to the Issuer in care of the Process Agent at the address specified above for the Process Agent (and the Issuer hereby agrees that such service will be effective upon the mailing or delivery by hand of such process to the Office of the Process Agent), and the Issuer hereby authorizes and directs the Process Agent to accept on its behalf such service. The Issuer hereby agrees that failure of the Process Agent to give notice to the Issuer, or failure of the Issuer to receive notice of such service of process, shall not affect in any way the validity of such service on the Process Agent or the Issuer. The Issuer hereby irrevocably consents to the service of any and all process in any Related Proceeding in a New York State or federal court sitting in The City of New York by sending by U.S. registered mail copies of such process to the Issuer at the Ministry of Economy and Finance (and the Issuer hereby agrees that such service will be effective seven days after mailing thereof). The Issuer hereby covenants and agrees that it shall take any and all reasonable action, including the execution and filing of any and all documents, that may be necessary to continue the designation of the Process Agent in full force and effect, and to cause the Process Agent to continue to act as such. In addition, the Issuer hereby agrees that no documents or agreements to which it is a party or to which it or its property is subject will affect the right of any party to serve legal process in any other manner permitted by law or affect the right of any party to bring any suit, action or proceeding against any other party or its property in the courts of any other jurisdiction.

To the extent that the Issuer has or hereafter may acquire any immunity (sovereign or otherwise) from jurisdiction of any court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution, execution or otherwise) with respect to itself or its property, the Issuer hereby irrevocably agrees not to claim and will irrevocably waive such immunity in respect of any Related Proceeding, and, without limiting the generality of the foregoing, the Issuer hereby agrees that such waivers shall have the fullest scope permitted under the Foreign Sovereign Immunities Act of 1976 of the United States and are intended to be irrevocable for purposes of such Act. Notwithstanding the foregoing, the execution on or attachment of revenues, assets and property of the Issuer located in the Republic through the courts of the Republic, both prior to and post-judgment, shall be subject to the provisions of Articles 1047, 1048, 1650(#14) and 1939 of the Judicial Code of the Republic of Panama.

------

Notwithstanding the foregoing, the Issuer does not consent to service of process or waive sovereign immunity with respect to actions brought against it under United States federal securities laws or any securities laws of any states of the United States, and the Issuer's appointment of the Process Agent hereunder does not extend to such actions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14. To the extent permitted by law, all claims against the Issuer for payment of principal of or premium if any, or interest on, or in respect of, the Securities (including Additional Amounts) shall be prescribed unless made within five years from the date on which such payment first became due.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15. The Issuer may, from time to time, without the consent of the holders of any Security of this Series, create and issue additional Securities having terms and conditions the same as the Securities of this Series, or the same except for the amount of the first payment of interest, which additional Securities may be consolidated and form a single series with the outstanding Securities of this Series; <u>provided</u> that such additional Securities do not have, for purposes of U.S. federal income taxation (regardless of whether any holders of such Securities are subject to the U.S. federal tax laws), a greater amount of original issue discount than the Securities of this Series have as of the date of the issue of such additional Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16. All notices to the holders of definitive Securities of this Series will be given by publishing such notices in a leading newspaper having general circulation in London and New York. All notices to the holders while the Securities of this Series are in book-entry form, will be sent to depositary or its nominee, as a holder thereof, and the depositary will communicate such notices to its participants in accordance with its standard rules. In addition, if and so long as the Securities are listed on the Luxembourg Stock Exchange and the rules of such Exchange shall so require, notices to holders of the Securities will be published in a leading newspaper with general circulation in Luxembourg or by publication on the website of the Luxembourg Stock Exchange at http://www.bourse.iu. Notice will be considered given on the date of its first publication.

\* \* \* \* \*

## Ex-99.N

**Exhibit N** 

**REPUBLIC OF PANAMA** 

**(the "Republic")** 

**U.S.$800,000,000 6.400% Global Bonds due 2035** 

**U.S.$1,000,000,000 6.853% Global Bonds due 2054** 

**<u>TERMS AGREEMENT</u>**

March 21, 2023

To: The Underwriters identified herein

Ladies and Gentlemen:

The undersigned agrees to sell to the Underwriters named in Schedule A hereto, on and subject to the terms and conditions of the Underwriting Agreement (the "Underwriting Agreement") attached hereto as Schedule D and filed as an exhibit to the Republic's registration statement under Schedule B of the Securities Act of 1933 (No. 333-250981) (the "Registration Statement"), the following Offered Securities on the following terms:

---

| | |
|:---|:---|
| Title: | 6.400% Global Bonds due 2035 (the "2035 Global Bonds")<br>6.853% Global Bonds due 2054 (the "2054 Global Bonds" and, together with the 2035 Global Bonds, the "Offered Securities") |
| Principal Amount: | For the 2035 Global Bonds:<br>U.S.$800,000,000<br>For the 2054 Global Bonds:<br>U.S.$1,000,000,000 |
| Issue Price: | For the 2035 Global Bonds:<br>101.961% of principal amount plus accrued interest, totaling U.S.$6,257,777.78, or U.S.$7.822 per U.S.$1,000 principal amount of the 2035 Global Bonds, from February 14, 2023, to, but not including, March 28, 2023, plus accrued interest, if any, from March 28, 2023 |

---

------

---

| | |
|:---|:---|
|  | For the 2054 Global Bonds:<br>100.000% of principal amount plus accrued interest, if any, from March 28, 2023 |
| Interest: | For the 2035 Global Bonds:<br>6.400% per annum, from and including February 14, 2023, payable semi-annually on February 14 and August 14 of each year, commencing August 14, 2023, to holders of record on January 31 and July 31, as the case may be.<br>For the 2054 Global Bonds:<br>6.853% per annum, from and including March 28, 2023, payable semi-annually on March 28 and September 28 of each year, commencing September 28, 2023, to holders of record on March 13 and September 13, as the case may be. |
| Maturity: | For the 2035 Global Bonds:<br>February 14, 2035<br>For the 2054 Global Bonds:<br>March 28, 2054<br>The Republic will pay the principal of the 2054 Global Bonds in three equal annual installments on March 28 of each year, commencing on March 28, 2052. |
| Reopening: | The 2035 Global Bonds constitute a further issuance of, and will form a single series with, the U.S.$1,500,000,000 aggregate principal amount of Panama's 6.400% Global Bonds due 2035 issued on November 21, 2022. |
| Optional Redemption: | *For the 2035 Global Bonds*:<br>Prior to November 14, 2034 (three months prior to their maturity date) (the "2035 Par Call Date"), the Republic may redeem the 2035 Global Bonds at its option, in whole or in part, at any time and from time to time, at a redemption price (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of:<br>(1) (a) the sum of the present values of the remaining scheduled payments of principal and interest thereon discounted to the redemption date (assuming the 2035 Global Bonds matured on the 2035 Par Call Date) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 40 basis points less (b) interest accrued to the date of redemption, and<br>|

---

------

<br> (2) 100% of the principal amount of the 2035 Global Bonds to be redeemed,<br>plus, in either case, accrued and unpaid interest thereon to the redemption date.<br>On or after the 2035 Par Call Date, the Republic may redeem the 2035 Global Bonds, in whole or in part, at any time and from time to time, at a redemption price equal to 100% of the principal amount of the 2035 Global Bonds being redeemed plus accrued and unpaid interest thereon to the redemption date.<br>The following terms shall have the following meanings:<br>"Treasury Rate" means, with respect to any redemption date, the yield determined by the Republic, in accordance with the following two paragraphs.<br>The Treasury Rate shall be determined by the Republic after 4:15 p.m., New York City time (or after such time as yields on U.S. government securities are posted daily by the Board of Governors of the Federal Reserve System), on the third business day preceding the redemption date based upon the yield or yields for the most recent day that appear after such time on such day in the most recent statistical release published by the Board of Governors of the Federal Reserve System designated as "Selected Interest Rates (Daily) - H.15"<br>

------

(or any successor designation or publication) ("H.15") under the caption "U.S. government securities–Treasury constant maturities–Nominal" (or any successor caption or heading). In determining the Treasury Rate, the Republic shall select, as applicable: (1) the yield for the Treasury constant maturity on H.15 exactly equal to the period from the redemption date to the 2035 Par Call Date (the "Remaining Life"); or (2) if there is no such Treasury constant maturity on H.15 exactly equal to the Remaining Life, the two yields – one yield corresponding to the Treasury constant maturity on H.15 immediately shorter than and one yield corresponding to the Treasury constant maturity on H.15 immediately longer than the Remaining Life – and shall interpolate to the 2035 Par Call Date on a straight-line basis (using the actual number of days) using such yields and rounding the result to three decimal places; or (3) if there is no such Treasury constant maturity on H.15 shorter than or longer than the Remaining Life, the yield for the single Treasury constant maturity on H.15 closest to the Remaining Life. For purposes of this paragraph, the applicable Treasury constant maturity or maturities on H.15 shall be deemed to have a maturity date equal to the relevant number of months or years, as applicable, of such Treasury constant maturity from the redemption date.<br>If on the third business day preceding the redemption date H.15 or any successor designation or publication is no longer published, the Republic shall calculate the Treasury Rate based on the rate per annum equal to the semi-annual equivalent yield to maturity at 11:00 a.m., New York City time, on the second business day preceding such redemption date of the United States Treasury security maturing on, or with a maturity that is closest to, the 2035 Par Call Date, as applicable. If there is no United States Treasury security maturing on the 2035 Par Call Date but there are two or more United States Treasury securities with a maturity date equally distant from the 2035 Par Call Date, one with a maturity date preceding the 2035 Par Call Date and<br>

------

one with a maturity date following the 2035 Par Call Date, the Republic shall select the United States Treasury security with a maturity date preceding the 2035 Par Call Date. If there are two or more United States Treasury securities maturing on the 2035 Par Call Date or two or more United States Treasury securities meeting the criteria of the preceding sentence, the Republic shall select from among these two or more United States Treasury securities the United States Treasury security that is trading closest to par based upon the average of the bid and asked prices for such United States Treasury securities at 11:00 a.m., New York City time. In determining the Treasury Rate in accordance with the terms of this paragraph, the semi-annual yield to maturity of the applicable United States Treasury security shall be based upon the average of the bid and asked prices (expressed as a percentage of principal amount) at 11:00 a.m., New York City time, of such United States Treasury security, and rounded to three decimal places.<br>The Republic's actions and determinations in determining the redemption price shall be conclusive and binding for all purposes, absent manifest error.<br>Notice of any redemption will be mailed or electronically delivered (or otherwise transmitted in accordance with the depositary's procedures) at least 10 days but not more than 60 days before the redemption date to each holder of the 2035 Global Bonds to be redeemed.<br>In the case of a partial redemption, selection of the 2035 Global Bonds for redemption will be made pro rata, by lot or by such other method as the Fiscal Agent in its sole discretion deems appropriate and fair. No 2035 Global Bonds of a principal amount of $200,000 or less will be redeemed in part. If any 2035 Global Bond is to be redeemed in part only, the notice of redemption that relates to the 2035 Global Bond will state the portion of the principal<br>

------

amount of the 2035 Global Bond to be redeemed. A new 2035 Global Bond in a principal amount equal to the unredeemed portion of the 2035 Global Bonds will be issued in the name of the holder of the 2035 Global Bond upon surrender for cancellation of the original 2035 Global Bond. For so long as the 2035 Global Bonds are held by DTC (or another depositary), the redemption of the 2035 Global Bonds shall be done in accordance with the policies and procedures of the depositary.<br>Unless the Republic defaults in payment of the redemption price, on and after the redemption date interest will cease to accrue on the 2035 Global Bonds or portions thereof called for redemption.<br>*For the 2054 Global Bonds*:<br>Prior to September 28, 2053 (six months prior to their final maturity date) (the "2054 Par Call Date"), the Republic may redeem the 2054 Global Bonds at its option, in whole or in part, at any time and from time to time, at a redemption price (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of:<br>(1) (a) the sum of the present values of the remaining scheduled payments of principal and interest thereon discounted to the redemption date (assuming the 2054 Global Bonds matured on the 2054 Par Call Date) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 50 basis points less (b) interest accrued to the date of redemption, and<br>(2) 100% of the principal amount of the 2054 Global Bonds to be redeemed,<br>plus, in either case, accrued and unpaid interest thereon to the redemption date.<br>

------

On or after the 2054 Par Call Date, the Republic may redeem the 2054 Global Bonds, in whole or in part, at any time and from time to time, at a redemption price equal to 100% of the principal amount of the 2054 Global Bonds being redeemed plus accrued and unpaid interest thereon to the redemption date.<br>The following terms shall have the following meanings:<br>"Treasury Rate" means, with respect to any redemption date, the yield determined by the Republic, in accordance with the following two paragraphs.<br>The Treasury Rate shall be determined by the Republic after 4:15 p.m., New York City time (or after such time as yields on U.S. government securities are posted daily by the Board of Governors of the Federal Reserve System), on the third business day preceding the redemption date based upon the yield or yields for the most recent day that appear after such time on such day in the most recent statistical release published by the Board of Governors of the Federal Reserve System designated as "Selected Interest Rates (Daily)—H.15" (or any successor designation or publication) ("H.15") under the caption "U.S. government securities–Treasury constant maturities–Nominal" (or any successor caption or heading). In determining the Treasury Rate, the Republic shall select, as applicable: (1) the yield for the Treasury constant maturity on H.15 exactly equal to the period (the "Remaining Life") from the redemption date to the date that reflects the remaining Weighted Average Life of the 2054 Global Bonds (assuming the last amortization payment on the 2054 Global Bonds is made on the 2054 Par Call Date) (the "WAL Date"); or (2) if there is no such Treasury constant maturity on H.15 exactly equal to the Remaining Life, the two yields – one yield corresponding to the Treasury constant maturity on H.15 immediately shorter than and one yield corresponding to the Treasury constant maturity on H.15 immediately longer than the Remaining Life –<br>

------

and shall interpolate to the WAL Date on a straight-line basis (using the actual number of days) using such yields and rounding the result to three decimal places; or (3) if there is no such Treasury constant maturity on H.15 shorter than or longer than the Remaining Life, the yield for the single Treasury constant maturity on H.15 closest to the Remaining Life. For purposes of this paragraph, the applicable Treasury constant maturity or maturities on H.15 shall be deemed to have a maturity date equal to the relevant number of months or years, as applicable, of such Treasury constant maturity from the redemption date.<br>If on the third business day preceding the redemption date H.15 or any successor designation or publication is no longer published, the Republic shall calculate the Treasury Rate based on the rate per annum equal to the semi-annual equivalent yield to maturity at 11:00 a.m., New York City time, on the second business day preceding such redemption date of the United States Treasury security maturing on, or with a maturity that is closest to, the WAL Date, as applicable. If there is no United States Treasury security maturing on the WAL Date but there are two or more United States Treasury securities with a maturity date equally distant from the WAL Date, one with a maturity date preceding the WAL Date and one with a maturity date following the WAL Date, the Republic shall select the United States Treasury security with a maturity date preceding the WAL Date. If there are two or more United States Treasury securities maturing on the WAL Date or two or more United States Treasury securities meeting the criteria of the preceding sentence, the Republic shall select from among these two or more United States Treasury securities the United States Treasury security that is trading closest to par based upon the average of the bid and asked prices for such United States Treasury securities at 11:00 a.m., New York City time. In determining the Treasury Rate in accordance with the terms of this paragraph, the semi-annual yield to maturity of the applicable<br>

------

United States Treasury security shall be based upon the average of the bid and asked prices (expressed as a percentage of principal amount) at 11:00 a.m., New York City time, of such United States Treasury security, and rounded to three decimal places.<br>"Weighted Average Life" at any date means the number of years obtained by dividing: (1) the sum of the products obtained by multiplying (a) the amount of each then remaining installment in respect of the 2054 Global Bonds, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such installment payment; by (2) the then outstanding principal amount of the 2054 Global Bonds.<br>The Republic's actions and determinations in determining the redemption price shall be conclusive and binding for all purposes, absent manifest error.<br>Notice of any redemption will be mailed or electronically delivered (or otherwise transmitted in accordance with the depositary's procedures) at least 10 days but not more than 60 days before the redemption date to each holder of the 2054 Global Bonds to be redeemed.<br>In the case of a partial redemption, selection of the 2054 Global Bonds for redemption will be made pro rata, by lot or by such other method as the Fiscal Agent in its sole discretion deems appropriate and fair. No 2054 Global Bonds of a principal amount of $200,000 or less will be redeemed in part. If any 2054 Global Bond is to be redeemed in part only, the notice of redemption that relates to the 2054 Global Bond will state the portion of the principal amount of the 2054 Global Bond to be redeemed. A new 2054 Global Bond in a principal amount equal to the unredeemed portion of the 2054 Global Bonds will be issued in the name of the holder of the 2054 Global Bond upon surrender for<br>

------

---

| | |
|:---|:---|
|  | cancellation of the original 2054 Global Bond. For so long as the 2054 Global Bonds are held by DTC (or another depositary), the redemption of the 2054 Global Bonds shall be done in accordance with the policies and procedures of the depositary.<br>Unless the Republic defaults in payment of the redemption price, on and after the redemption date interest will cease to accrue on the 2054 Global Bonds or portions thereof called for redemption. |
| Sinking Fund: | None. |
| Listing: | Application will be made to list the Offered Securities on the Official List of the Luxembourg Stock Exchange and to have the Offered Securities admitted to trading on the Euro MTF Market. |
| Delayed Delivery Contracts: | None. |
| Gross Proceeds to the Issuer (before deducting underwriting fees and other offering expenses and, in the case of the 2035 Global Bonds, excluding accrued interest): | For 2035 Global Bonds:<br>U.S.$815,688,000<br>For 2054 Global Bonds:<br>U.S.$1,000,000,000 |
| Underwriting Discount: | 0.050% of Principal Amount of Offered Securities. |
| Closing: | 8:00 a.m., New York time, on March 28, 2023 at the offices of Arnold & Porter Kaye Scholer LLP, 250 West 55th Street, New York, New York 10019-9710 or such other location as may otherwise be agreed. Payment for the Offered Securities shall be made by the Underwriters in Federal (same-day) funds. |
| Settlement and Trading: | Book-Entry only via DTC. The Offered Securities will trade in DTC's Same Day Funds Settlement System. Initial settlement and secondary trading may also take place through the facilities of Euroclear or Clearstream. |

---

------

---

| | |
|:---|:---|
| Moody's Investors <br>Service, Inc. rating: | [*Intentionally omitted*] |
| S&P Global Ratings rating: | [*Intentionally omitted*] |
| Fitch Ratings, Inc. rating: | [*Intentionally omitted*] |
| Fiscal Agent: | The Bank of New York Mellon (as successor to JPMorgan Chase Bank, N.A.) |
| Fiscal Agency<br> Agreement: | Dated September 26, 1997, between the Fiscal Agent referred to above and the Republic of Panama, as amended by Amendment No. 1 thereto, dated as of September 4, 2003, Amendment No. 2 thereto, dated as of February 13, 2015, and Amendment No. 3 thereto, dated as of October 26, 2016. |
| Representatives: | All references in the Underwriting Agreement to the Representatives, as defined therein, shall be understood to refer to Goldman Sachs & Co. LLC and Scotia Capital (USA) Inc. |
| Allocation of Expenses: | The provisions of Section 4(f) of the Underwriting Agreement, relating to certain expenses to be borne by the Republic, will not apply and are replaced by the following arrangements: |
|  | The Underwriters will be responsible for their own out-of-pocket and travel expenses, their counsels' fees and expenses and will seek no reimbursement for these costs. The Republic will be responsible for its own out-of-pocket and travel expenses including any expenses associated with investor meetings, its counsels' fees and expenses, the costs of printing and distributing the offering documents (including the Registration Statement, Prospectus, any prospectus supplement or supplements and Issuer Free Writing Prospectuses, if any), costs of the fiscal agent and any listing agents for the Offered Securities, the cost of any filing and regulatory fees, and other expenses associated with the offering. |

---

------

---

| | |
|:---|:---|
| Delivery: | Delivery of the Offered Securities to the Underwriters for purposes of Section 3 of the Underwriting Agreement shall be made to each of Goldman Sachs & Co. LLC and Scotia Capital (USA) Inc. in the amounts set forth in Schedule A hereto. |
| New York Courts: | References to "New York Courts" in the Underwriting Agreement shall refer to any state or Federal court in the Borough of Manhattan, The City of New York, New York. |
| Names and Addresses <br>of the Underwriters: | Goldman Sachs & Co. LLC<br> 200 West Street<br> New York, NY 10282<br>Scotia Capital (USA) Inc.<br> 250 Vesey Street<br> New York, New York 10281 |
| Additional Representations and Warranties of the Republic: | (1) For the purposes of this Agreement, the "Time of Sale" means 4:55 p.m. New York City time on March 21, 2023. The basic prospectus relating to the Offered Securities contained in the Registration Statement, in the form in which it has most recently been filed with the Securities and Exchange Commission (the "Commission") on or prior to the date hereof, is hereinafter called the "Basic Prospectus." The Basic Prospectus, as amended and supplemented immediately prior to the Time of Sale, is hereinafter called the "Pricing Prospectus," and the form of final prospectus relating to the Offered Securities filed with the Commission pursuant to the applicable paragraph of Rule 424(b) is hereinafter referred to as the "Prospectus." The Pricing Prospectus relating to the Offered Securities, considered together with each "issuer free writing prospectus" as defined in Rule 433 under the Act relating to the Offered Securities ("Issuer Free Writing Prospectus"), as of the Time of Sale of the Offered Securities (collectively, the "Time of Sale Information"), does not or will not include any untrue statement of a material fact or omit to state any material fact necessary in order to |

---

------

make the statements therein, in the light of the circumstances under which they were made, not misleading; and each Issuer Free Writing Prospectus with respect to the Offered Securities did not or will not conflict with the information contained in the Registration Statement (as such Registration Statement existed at the time of issuance of such Issuer Free Writing Prospectus); provided, however, that the representations and warranties in this paragraph (1) shall not apply to statements in or omissions from any such document made in reliance upon and in conformity with information furnished in writing to the Republic by the Underwriters expressly for use therein.<br>(2) (i) At the earliest time after the filing of the Registration Statement (or the most recent post-effective amendment thereto) that the Republic or another offering participant made a bona fide offer (within the meaning of Rule 164(h) (2) under the Act) and (ii) as of the date hereof, the Republic was not and is not an "ineligible issuer" (as defined in Rule 405 under the Act), without taking into account any determination by the Commission pursuant to Rule 405 that it is not necessary that the Republic be considered an "ineligible issuer".<br>(3) The Republic will not offer, sell, contract to sell or otherwise dispose of any debt securities of the Republic, guaranteed by the Republic or any agency or enterprise controlled by the Republic that are substantially similar to the Offered Securities, are denominated in U.S. dollars, are to be placed outside the Republic and which have tenors substantially similar to the Offered Securities, during the period beginning the date of the filing of the prospectus supplement and continuing to, and including, the later of (x) completion of the distribution of the Offered Securities and (y) the Closing Date, without prior written consent of the Underwriters.<br>(4) The Republic will use the proceeds from the Offered Securities for general budgetary purposes and liability management transactions.<br>

------

---

| | |
|:---|:---|
|  | (5) Neither the Republic nor, to the knowledge of the Republic, any agent of the Republic is currently subject to any sanctions administered or enforced by the U.S. Government, including, without limitation, the Office of Foreign Assets Control of the U.S. Treasury Department, the U.S. Department of Commerce, the U.S. Department of State, or by the United Nations Security Council, the European Union, or His Majesty's Treasury, or other relevant sanctions authority (collectively, "Sanctions"). The Republic will not, directly or indirectly, use the proceeds of any sale of the Offered Securities, or lend, contribute or otherwise make available such proceeds to any entity or person, (i) to fund any activities of or business with any person that, at the time of such funding, is the subject of any Sanctions, or is in any country, region or territory, that, at the time of such funding, is the subject of territorial Sanctions or (ii) in any other manner, in each case as would result in a violation by any person (including any person participating in a sale or offering of the Offered Securities, whether as underwriter, advisor, investor or otherwise) of Sanctions. |
| Modifications to Representations and Warranties of the Republic: | (1) The second sentence of Section 1 of the Underwriting Agreement is hereby replaced with the following:<br>"The Registered Securities will be issued under a fiscal agency agreement (the "Fiscal Agency Agreement"), dated as of September 26, 1997, between the Republic and the fiscal agent (the "Fiscal Agent"), The Bank of New York Mellon (as successor to JPMorgan Chase Bank, N.A.), as amended by Amendment No. 1 thereto, dated as of September 4, 2003, Amendment No. 2 thereto, dated as of February 13, 2015, and Amendment No. 3 thereto, dated as of October 26, 2016, in one or more series, which series may vary as to interest rates, maturities, redemption provisions, selling prices and other terms, with all such terms for any particular series of the Registered Securities being determined at the time of sale." |

---

------

(2) The second sentence of Section 2(a) of the Underwriting Agreement is hereby replaced with the following:<br>"Such registration statements (including all materials incorporated by reference therein and all exhibits thereto), as amended at the time of any Terms Agreement referred to in Section 3, are hereinafter collectively referred to as the "Registration Statement", and the prospectus included in such Registration Statement, as supplemented as contemplated by Section 3 to reflect the terms of the Offered Securities and the terms of offering thereof, as first filed with the Commission pursuant to and in accordance with Rule 424(b) ("Rule 424(b)") under the Act, including all material incorporated by reference therein, is hereinafter referred to as the "Prospectus"."<br>(3) Section 2(c) of the Underwriting Agreement is hereby replaced with the following:<br>"(c) Since the respective dates as of which information is given in the Registration Statement, the Prospectus and the Time of Sale Information, there has not been any material adverse change, or any event that would result in a prospective material adverse change, in the financial, economic or fiscal condition of the Republic, otherwise than as set forth in or contemplated in the Prospectus and the Time of Sale Information."<br>(4) Section 2(g) of the Underwriting Agreement is hereby replaced with the following:<br>

------

"(g) All consents, approvals, authorizations, orders, registrations, clearances or qualifications ("Governmental Authorizations") of or with any court, ministry or governmental agency or other regulatory body ("Governmental Agency") in the Republic required for the issue and sale of the Offered Securities or the consummation by the Republic of the transactions contemplated by the Terms Agreement (including the provisions of this Agreement), any Delayed Delivery Contracts, the Fiscal Agency Agreement or the Offered Securities, including without limitation the payment of interest and principal to the holders of the Offered Securities outside the Republic in accordance with the terms thereof, have been obtained and are in full force and effect; and the issue and sale of the Offered Securities and the consummation by the Republic of the transactions contemplated by the Terms Agreement (including this Agreement), any Delayed Delivery Contracts, the Fiscal Agency Agreement or the Offered Securities will be in compliance with all laws, decrees and regulations of the Republic or of any Governmental Agency in the Republic including, without limitation, (i) any applicable public net debt to nominal Gross Domestic Product ("GDP") targets, (ii) the non-financial public sector deficit to nominal GDP target applicable to the fiscal year in which the Offered Securities are offered and purchased, and (iii) other applicable provisions of the Fiscal Responsibility Law N°34 dated June 5, 2008, as amended, and its regulations promulgated thereunder to this date.<br>(5) Section 2(i) and Section 2(j) of the Underwriting Agreement are hereby replaced with the following:<br>"(i) Other than as set forth in the Registration Statement, the Time of Sale Information and the Prospectus, there are no legal or governmental actions, suits, arbitrations or proceedings pending to which the Republic is a party which, if determined adversely to the Republic, would individually or in the aggregate have a material adverse effect on the financial, economic or fiscal condition of the Republic or its ability to perform its obligations under the Terms Agreement, any Delayed Delivery Contracts, the Fiscal Agency Agreement or the Offered Securities or which are otherwise material to the rights of holders of the Offered Securities;<br>

------

and, to the best of the Republic's knowledge, no such actions, suits, arbitrations or proceedings are threatened which, if determined adversely to the Republic, would individually or in the aggregate have a material adverse effect on the financial, economic or fiscal condition of the Republic or its ability to perform its obligations under the Terms Agreement, any Delayed Delivery Contracts, the Fiscal Agency Agreement or the Offered Securities or which are otherwise material to the rights of holders of the Offered Securities.<br>(j) Other than as set forth in the Registration Statement, the Time of Sale Information and the Prospectus, the Republic is not in default in the payment of principal, interest or any other amount owing on any obligation in respect of indebtedness for money borrowed and the Republic has not received any notice of default or acceleration with respect to any obligation in respect of indebtedness for money borrowed, in each case or in the aggregate, which would have a material adverse effect on the financial, economic or fiscal condition of the Republic or its ability to perform its obligations under the Terms Agreement, any Delayed Delivery Contracts, the Fiscal Agency Agreement or the Offered Securities or which is otherwise material to the rights of the holders of the Offered Securities; and the issue and sale of the Offered Securities and the compliance by the Republic with all of the provisions of the Terms Agreement, any Delayed Delivery Contracts, the Fiscal Agency Agreement and the Offered Securities and the consummation of the transactions herein and therein contemplated will not conflict with or result in a breach of any of the terms or provisions of, or constitute a default under, the Constitution of the Republic, as amended to the date of the Terms Agreement, any statutes, laws, decrees or regulations of the Republic or any treaty, convention or agreement to which the Republic is a party or to which any property of the Republic is subject and which default, in each case or in the aggregate, would have a material adverse effect on<br>

------

the financial, fiscal or economic condition of the Republic or its ability to perform its obligations under the Terms Agreement, any Delayed Delivery Contracts, the Fiscal Agency Agreement or the Offered Securities or which is otherwise material to the rights of the holders of the Offered Securities."<br>(6) Section 2(k) of the Underwriting Agreement is hereby replaced with the following:<br>"(k) To ensure the legality, validity, enforceability, priority or admissibility in evidence in the Republic of the Terms Agreement, any Delayed Delivery Contracts, the Fiscal Agency Agreement, the Offered Securities or any other document or instrument related to the offer and sale of the Offered Securities, it is not necessary that the Terms Agreement, any Delayed Delivery Contracts, the Fiscal Agency Agreement, the Offered Securities or any other documents or instruments be registered, recorded or filed with any court or other authority in the Republic (other than the translation thereof) or that any documentary, stamp or similar tax, imposition or charge be paid on or in respect of the Terms Agreement, the Fiscal Agency Agreement, the Offered Securities or any document or instrument related to the offer and sale of the Offered Securities; except that documents executed outside of Panama must be authenticated by a consular officer of Panama or pursuant to the 1961 Hague Convention Abolishing the Requirement of Legalisation for Foreign Public Documents before being submitted as evidence in the courts of Panama or before a government agency in Panama."<br>(7) Section 2(m) of the Underwriting Agreement is hereby replaced with the following:<br>"(m)Neither the Republic nor any person acting on its behalf has taken, directly or indirectly, any action which might reasonably be expected to cause or result in stabilization of the price of any security of the Republic to facilitate the offer and sale of the Offered Securities or the sale or resale of the Offered Securities; provided, however, that no representation or warranty is given by the Republic with respect to any actions of the Underwriters."<br>

------

<br> (8) Section 2(p) of the Underwriting Agreement is hereby replaced with the following:<br>"(p) The Republic is not aware that any of S&P Global Ratings, a division of S&P Global, Inc. ("Standard & Poor's"), Moody's Investors Service, Inc. ("Moody's") or Fitch Ratings, Inc. ("Fitch") has made any announcement that it will have under surveillance or review, with possible negative implications, its rating of any of the Republic's debt securities; and the Republic has not been informed by any of Standard & Poor's, Moody's or Fitch that it intends or is contemplating any downgrading in any rating accorded to the Republic's debt securities or any announcement that it will have under surveillance or review, with possible negative implications, its rating of any of the Republic's debt securities."<br>(9) Section 2(q) and Section 2(r) of the Underwriting Agreement are hereby replaced with the following:<br>"(q) The statements with respect to matters of Panamanian law set forth in the Prospectus and the Time of Sale Information are correct in all material respects.<br>(r) The Republic will make such arrangements as shall be reasonably necessary to permit settlement to occur in the manner described in the Prospectus and the Time of Sale Information."<br>(10) Section 2(h) of the Underwriting Agreement is hereby replaced with the following:<br>"The Offered Securities constitute and will constitute unsubordinated, unsecured (subject to provisions in the Offered Securities providing for securing such obligations in the event certain other obligations of the Republic are secured), direct,<br>

------

unconditional and general obligations of the Republic. The Offered Securities rank and will rank without any preference among themselves and equally with all other unsecured and unsubordinated Public Indebtedness of the Republic. It is understood that this provision shall not be construed so as to require the Republic to make payments under the Offered Securities ratably with payments being made under any other Public Indebtedness. The full faith and credit of the Republic is pledged for the due and punctual payment of all Offered Securities and for the due and timely payment of all obligations of the Republic in respect thereof. For purposes of this paragraph, "Indebtedness" means any payment obligation (whether pursuant to a guarantee or otherwise), including any contingent liability, for borrowed money or arising from bonds, debentures, notes or other similar instruments, and "Public Indebtedness" means any Indebtedness of, or guaranteed by, the Republic which (i) is publicly offered or privately placed in security markets, (ii) is in the form of, or represented by, bonds, notes or other securities or any guarantees thereof, (iii) is, or was intended at the time of issue to be, quoted, listed or traded on any stock exchange, automated trading system or over-the-counter or other securities market (including, without prejudice to the generality of the foregoing, securities eligible for sale pursuant to Rule 144A under the United States Securities Act of 1933, as amended (or any successor law or regulation of similar effect)) and (iv) has an original maturity of more than one year or is combined with a commitment so that the original maturity of one year or less may be extended at the option of the Republic to a period in excess of one year."<br>(10) Section 2(f) of the Underwriting Agreement is hereby replaced with the following:<br>"The Fiscal Agency Agreement has been duly authorized, executed and delivered and constitutes a valid and legally binding instrument, enforceable in accordance with its terms, subject, as to<br>

------

Additional Representations, Warranties and Covenants of the Underwriters: For the purposes of the first sentence of Section 5(a) of the Underwriting Agreement, the Underwriters have severally and not jointly represented and agreed that they have not offered, sold or otherwise made available and will not offer, sell or otherwise make available any Offered Securities to any retail investor in the European Economic Area ("EEA"). For the purposes of this provision the expression "retail investor" means a person who is one (or more) of the following: <br>i. a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU (as amended, "MiFID II"); or<br>ii. a customer within the meaning of Directive (EU) 2016/97 (as amended, the "Insurance Distribution Directive"), where that customer would not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II.<br>

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; For the purposes of the first sentence of Section 5(a) of the Underwriting Agreement, the Underwriters have severally and not jointly represented and agreed that they have not offered, sold or otherwise made available and will not offer, sell or otherwise make available any Offered Securities to any retail investor in the United Kingdom ("UK"). For the purposes of this provision the expression "retail investor" means a person who is one (or more) of the following:<br>i. a retail client, as defined in point (8) of Article 2 of Regulation (EU) No 2017/565 as it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018 (the "EUWA"); or<br>ii. a customer within the meaning of the provisions of the Financial Services and Markets Act 2000 (the "FSMA") and any rules or regulations made under the FSMA to implement Directive (EU) 2016/97, where that customer would not qualify as a professional client, as defined in point (8) of Article 2(1) of Regulation (EU) No 600/2014 as it forms part of domestic law by virtue of the EUWA.<br>For the purposes of the first sentence of Section 5(a) of the Underwriting Agreement, the Underwriters have severally and not jointly represented and agreed that:<br>i. they have only communicated or caused to be communicated and will only communicate or cause to be communicated an invitation or inducement to engage in investment activity (within the meaning of section 21 of the Financial Services and Markets Act 2000 (the "FSMA")) received by them in connection with the issue or sale of the Offered Securities in circumstances in which Section 21(1) of the FSMA does not apply to the Republic; and<br>ii. they have complied and will comply with all applicable provisions of the FSMA with respect to anything done by them in relation to the Offered Securities in, from or otherwise involving the<br> United Kingdom.<br>

------

---

| | |
|:---|:---|
|  | For the purposes of Section 5(b) of the Underwriting Agreement, the Underwriters have severally and not jointly represented and agreed with the Republic to deliver to counsel for the Underwriters for the benefit of the Republic, as soon as practicable following the initial distribution of the Offered Securities (but in no event later than 40 days after the Closing Date), confidential facsimiles enumerating the amount of Offered Securities sold by each of them in the initial distribution in the United States together with an estimate of the number of Offered Securities reasonably expected to be sold within the United States within 40 days of the Closing Date; <u>provided</u>, <u>however</u>, that the Underwriters shall bear no responsibility for any discrepancy between each such estimated amount and the actual amount of Offered Securities sold within the United States in such time period. |
| Modifications to Covenants of the Republic: | (1) Section 4(b), Section 4(c) and Section 4(d) of the Underwriting Agreement are hereby replaced with the following:<br>"(b) The Republic will advise the Underwriters promptly of any proposal to amend or supplement the Registration Statement, the Time of Sale Information or the Prospectus and will not effect such amendment or supplementation without the Underwriters' consent, which consent may not be unreasonably withheld, and the Republic will also advise the Underwriters promptly of the filing of any such amendment or supplement and of the institution by the Commission of any stop order proceedings in respect of the Registration Statement or of any part thereof, any free writing prospectus (as defined in Rule 405 under the Act) and the Prospectus and will use its best efforts to prevent the issuance of any such stop order and to obtain as soon as possible its lifting, if issued. |

---

------

---

| | |
|:---|:---|
|  | (c) If, at any time when a prospectus relating to the Offered Securities (or in lieu thereof, the notice referred to in Rule 173(a) under the Act) is required to be delivered under the Act in connection with sales by any Underwriter or any dealer, any event occurs as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if it is necessary at any time to amend the Prospectus to comply with the Act, the Republic promptly will notify the Underwriters of such event and will promptly prepare and file with the Commission, at its own expense, an amendment or supplement which will correct such statement or omission or an amendment which will effect such compliance. Neither any Underwriter's consent to, nor any Underwriter's delivery of, any such amendment or supplement shall constitute a waiver of any of the conditions set forth in Section 6. |
|  | (d) The Republic will furnish to the Representatives copies of the Registration Statement, including all exhibits, the Pricing Prospectus, the Prospectus, any Issuer Free Writing Prospectus and all amendments and supplements to such documents, in each case as soon as available and in such quantities as the Underwriters reasonably request."<br>(2) The reference in Section 4(f) of the Underwriting Agreement to "National Association of Securities Dealers, Inc." is hereby amended to read: "Financial Industry Regulatory Authority". |
| Free Writing Prospectuses: | (1) The Republic represents and agrees that it has not made and will not make any offer relating to the Offered Securities that would constitute a "free writing prospectus" as defined in Rule 405 under the Act without your prior written consent and that **Schedule B** hereto is a complete list of any Issuer Free Writing Prospectuses for which the Republic has hitherto received such consent. |

---

------

---

| | |
|:---|:---|
|  | (2) The Republic has complied and will comply with the requirements of Rule 433 under the Act applicable to any Issuer Free Writing Prospectus, including timely filing with the Commission or retention where required and legending. |
|  | (3) The Republic agrees that if at any time following issuance of an Issuer Free Writing Prospectus any event occurs as a result of which such Issuer Free Writing Prospectus (i) would conflict with the information in the Registration Statement or the Prospectus or (ii) when taken together with the Prospectus would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances then prevailing, not misleading, the Republic will give the Underwriters, or cause the Underwriters to be given, prompt notice thereof, and if the Underwriters so request, will cause to be prepared and furnished without charge to the Underwriters an Issuer Free Writing Prospectus or other document which will correct such conflict, statement or omission; provided, however, that this representation and warranty shall not apply to any statements or omissions in an Issuer Free Writing Prospectus made in reliance upon and in conformity with information furnished in writing to the Republic by the Underwriters expressly for use therein. |
| Modification to the Conditions to the Obligations of the Underwriters: | Section 6(a) of the Underwriting Agreement is hereby replaced with the following:<br>"(a)All representations and warranties and other statements of the Republic contained in the Terms Agreement (including the provisions of this Agreement) were at the applicable Time of Sale, are now, and at all times from the date of the Terms Agreement to the Closing Date will be, true and correct in all material respects (except for those representations, warranties and statements which are by their terms subject to materiality, in which case such representations, warranties or statements shall be true and correct in accordance with their terms)." |

---

------

---

| | |
|:---|:---|
| Additional Conditions to the Obligations of the Underwriters: | (1) The letters from U.S. counsel to the Underwriters and Panama counsel to the Underwriters, required by Section 6(c) and Section 6(d), respectively, of the Underwriting Agreement, shall contain a statement to the effect that no information has come to such counsel's attention that causes it to believe that the Time of Sale Information, as of the Time of Sale and the Closing Date, contained or contains an untrue statement of a material fact or omitted to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.<br>(2) The letter from the Procurador de la Administración required by Section 6(e) of the Underwriting Agreement shall contain a statement to the effect that no information has come to such counsel's attention that causes it to believe that the Time of Sale Information, as of the Time of Sale and the Closing Date, contained or contains an untrue statement of a material fact or omitted or omits to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.<br>(3) The letter from U.S. counsel for the Republic, required by Section 6(f) of the Underwriting Agreement, shall contain a statement to the effect that no information has come to such counsel's attention that causes it to believe that the Time of Sale Information, as of the Time of Sale and the Closing Date, contained or contains an untrue statement of a material fact or omitted or omits to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.<br>|

---

------

(4) The certificate required by Section 6(k) of the Underwriting Agreement shall contain a statement to the effect that as of the Time of Sale and the Closing Date, the Time of Sale Information and any further amendment or supplement thereto made by the Republic did not contain an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein not misleading; provided, however, that the foregoing certification shall not apply to any statements in or omissions from the Time of Sale Information or any amendment or supplement thereto made in reliance upon and in conformity with information furnished to the Republic in writing by the Underwriters expressly for use in the Time of Sale Information or any amendment or supplement thereto.<br>(5) Section 6(j) of the Underwriting Agreement is hereby replaced with the following:<br>"(j) On or after the date of the Terms Agreement and on or prior to the Closing Date (i) no downgrading shall have occurred in the rating accorded the Republic's debt securities by any of Standard & Poor's, Moody's or Fitch; (ii) no such organization shall have publicly announced that it has under surveillance or review, with possible negative implications, its rating of any of the Republic's debt securities; (iii) the Republic shall not have been aware that any of Standard & Poor's, Moody's or Fitch has announced that it will have under surveillance or review, with possible negative implications, its rating of any of the Republic's debt securities; and (iv) the Republic shall not have been informed by any of Standard & Poor's, Moody's or Fitch that it intends or is contemplating any downgrading in any rating accorded to the Republic's debt securities or any announcement that it will have under surveillance or review, with possible negative implications, its rating of any of the Republic's debt securities."<br>

------

---

| | |
|:---|:---|
| Modifications to Indemnification and Contribution: | Section 7(a) of the Underwriting Agreement is hereby replaced with the following:<br>"(a) The Republic will indemnify and hold harmless each Underwriter against any losses, claims, damages or liabilities, joint or several, to which such Underwriter may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in the Registration Statement, the Prospectus, or any amendment or supplement thereto, or any related preliminary prospectus or preliminary prospectus supplement, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse each Underwriter for any legal or other expenses reasonably incurred by such Underwriter in connection with investigating or defending any such loss, claim, damage, liability or action as such expenses are incurred; provided, however, that the Republic will not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement in or omission or alleged omission from any of such documents in reliance upon and in conformity with written information furnished to the Republic by any Underwriter through the Representatives, if any, specifically for use therein; it being understood and agreed that the only such information furnished by any Underwriter consists of the information described as such in subsection (b) below." |
| Modifications to Notices: | Notices if sent to the Republic are to be sent to Republic of Panama, Director of Public Financing, Directorate of Public Financing, Ministry of Economy and Finance of Panama, Via España y Calle 52, Edificio Ogawa, Piso 4, Panama, Republic of Panama. References to delivery of documents in the Underwriting Agreement to the "Ministry of Planning and Economic Policy" shall instead be to the "Ministry of Economy and Finance". |

---

------

---

| | |
|:---|:---|
| Modifications to Annex II: | Paragraph (iii) of Annex II is hereby replaced with the following:<br>"(iii) No order of General Applicability and no consent, approval, or authorization of, or qualification with, any United States federal or New York State governmental agency or body is required for the issue and sale of the Offered Securities or the performance by the Republic of the transactions contemplated by the Terms Agreement, the Underwriting Agreement or the Fiscal Agency Agreement, except such as have been obtained under the Act and such consents, approvals, authorizations or qualifications as may be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Offered Securities." |

---

*Recognition of the U.S. Special Resolution Regimes*:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) In the event that any Underwriter that is a Covered Entity (as defined below) becomes subject to a proceeding under a U.S. Special Resolution Regime (as defined below), the transfer from such Underwriter of this Terms Agreement, and any interest and obligation in or under this Terms Agreement, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Terms Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) In the event that any Underwriter that is a Covered Entity or a BHC Act Affiliate (as defined below) of such Underwriter becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Terms Agreement that may be exercised against such Underwriter are permitted to be exercised to no greater extent than such Default Rights (as defined below) could be exercised under the U.S. Special Resolution Regime if this Terms Agreement were governed by the laws of the United States or a state of the United States.

As used in this Terms Agreement:

"BHC Act Affiliate" has the meaning assigned to the term "affiliate" in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k).

------

"Covered Entity" means any of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) a "covered entity" as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) a "covered bank" as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) a "covered FSI" as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).

"Default Right" has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.

"U.S. Special Resolution Regime" means each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.

The principal amount of Offered Securities to be purchased by the Underwriters is set forth in **Schedule A** hereto, which is incorporated by reference as if set forth herein.

The provisions of the Underwriting Agreement, as herein amended and modified, are incorporated herein by reference.

In addition, the Republic hereby acknowledges and agrees that (i) the Underwriters are acting solely in the capacity of arm's length contractual counterparty to the Republic in connection with the purchase and sale of the Offered Securities, including the determination of the offering price and the underwriting discount, and not as financial advisor or fiduciary to, or agents of, the Republic or any other person, (ii) the Underwriters have not assumed an advisory or fiduciary responsibility in favor of the Republic with respect to the offering contemplated hereby or the process leading thereto (irrespective of whether the Underwriters have advised or is currently advising the Republic on other matters) or any other obligation to the Republic except the obligations expressly set forth in this Terms Agreement and the Underwriting Agreement and (iii) the Republic has consulted its own legal and financial advisors to the extent it deemed appropriate and shall be responsible for making its own independent investigation and appraisal of the transactions contemplated herein. The Republic agrees that it will not claim that the Underwriters have rendered advisory services of any nature or in any respect, or owe a fiduciary or similar duty to the Republic, in connection with such transaction or the process leading thereto.

Reference to the "Prospectus", or to any amendment thereof or supplement thereto, in Section 7 of the Underwriting Agreement shall also be deemed to refer to the Time of Sale Information and any Issuer Free Writing Prospectus.

------

For purposes of Section 7 of the Underwriting Agreement, paragraph (1) of the representations and warranties of the Republic set forth above under "Additional Representations and Warranties of the Republic," paragraph (3) of the representations and warranties of the Republic set forth above under "Free Writing Prospectuses" and paragraph (4) under "Additional Conditions to the Obligations of the Underwriters" above, the only information furnished to the Republic by the Underwriters for use in the Prospectus consists of the following information in the Prospectus furnished on behalf of the Underwriters:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) the first sentence of the sole paragraph of text under the caption "Risk Factors––Risk Factors
Relating to the Global Bonds––The price at which the global bonds will trade in the secondary market is uncertain" in the Pricing Prospectus;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) the names of the Underwriters on the cover page and in the first paragraph of text under the caption
"Underwriting" in the Pricing Prospectus;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) the second and sixth paragraphs of text under the caption "Underwriting" in the Pricing Prospectus;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) the third through fifth sentences of the first paragraph of text under the caption "Other
Relationships" under the caption "Underwriting" in the Pricing Prospectus;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e) the first sentence of the sole paragraph of text under the caption "Risk Factors––Risk Factors
Relating to the Global Bonds––The price at which the global bonds will trade in the secondary market is uncertain" in the Prospectus;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f) the names of the Underwriters on the cover page and in the first paragraph of text under the caption
"Underwriting" in the Prospectus;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g) the second and sixth paragraphs of text under the caption "Underwriting" in the Prospectus; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;h) the third through fifth sentences of the first paragraph of text under the caption "Other
Relationships" under the caption "Underwriting" in the Prospectus.

------

If the foregoing is in accordance with your understanding of our agreement, kindly sign and return to the Republic one of the counterparts hereof, whereupon it will become a binding agreement between the Republic and the Underwriters in accordance with its terms.

---

| | |
|:---|:---|
| Very truly yours, | Very truly yours, |
| REPUBLIC OF PANAMA | REPUBLIC OF PANAMA |
| By: | /s/ Enelda Medrano de González |
|  | Name: Enelda Medrano de González |
|  | Title: Vice Minister of Economy of the Ministry of Economy and Finance |
| REFRENDO: CONTRALORIA GENERAL DE LA REPUBLICA DE PANAMA | REFRENDO: CONTRALORIA GENERAL DE LA REPUBLICA DE PANAMA |
| By: | /s/ Gerardo Solís |
|  | Name: Gerardo Solís |
|  | Title: Contralor General |
| The foregoing Terms Agreement is hereby confirmed and accepted as of the date first above written. | The foregoing Terms Agreement is hereby confirmed and accepted as of the date first above written. |

---

*[Signature Page to the Terms Agreement]*

------

---

| | |
|:---|:---|
| GOLDMAN SACHS & CO. LLC | GOLDMAN SACHS & CO. LLC |
| By: | /s/ Carlos Mendoza |
|  | Name: Carlos Mendoza |
|  | Title: Managing Director |
| SCOTIA CAPITAL (USA) INC. | SCOTIA CAPITAL (USA) INC. |
| By: | /s/ Elsa Wang |
|  | Name: Elsa Wang<br> Title: Managing Director |

---

*[Signature Page to the Terms Agreement]*

------

SCHEDULE A TO THE

TERMS AGREEMENT

---

| | | | | |
|:---|:---|:---|:---|:---|
| Underwriter | Principal Amount of<br>the 2035 Global Bonds | Principal Amount of<br>the 2035 Global Bonds | Principal Amount of<br>the 2054 Global Bonds | Principal Amount of<br>the 2054 Global Bonds |
|  Goldman Sachs & Co. LLC | U.S.$| 400000000 | U.S.$| 500000000 |
|  Scotia Capital (USA) Inc. | U.S.$| 400000000 | U.S.$| 500000000 |
|  **Total** | U.S.$| 800000000 | U.S.$| 1000000000 |

---

------

SCHEDULE B TO THE

TERMS AGREEMENT

Issuer Free Writing Prospectuses for which consent has been

received on or prior to the date of the Terms Agreement

1. Issuer Free Writing Prospectuses to be filed with the Commission on March 22, 2023, pursuant to Rule 433, in the form set forth in Schedule C hereto.

------

SCHEDULE C TO THE

TERMS AGREEMENT

**Republic of Panama** 

**U.S.$800,000,000 6.400% Global Bonds due 2035** 

**March 21, 2023** 

<u>Term Sheet</u> 

---

| | |
|:---|:---|
| Issuer: | Republic of Panama ("Panama" or the "Republic") |
| Transaction: | 6.400% Global Bonds due 2035 (the "2035 Global Bonds") |
| Distribution: | SEC-Registered Global Bonds |
| Ranking: | Senior Unsecured |
| Expected Ratings\*: | [*Intentionally omitted*] |
| Amount Issued: | U.S.$800,000,000 aggregate principal amount |
| Coupon: | 6.400% (30/360 day count basis) |
| Maturity: | February 14, 2035 |
| Offering Price: | 101.961% of principal amount plus accrued interest, totaling U.S.$6,257,777.78, or U.S.$7.822 per U.S.$1,000<br> principal amount of the 2035 Global Bonds, from February 14, 2023, to, but not including, March 28, 2023, plus accrued interest, if any, from March 28, 2023 |
| Gross Proceeds to the Issuer <br>(before deducting underwriting fees and other offering expenses and excluding accrued interest): | U.S.$815,688,000 |
| Yield to Maturity: | 6.161% |
| Spread to Benchmark Treasury: | 255 basis points |
| Benchmark Treasury: | 3.500% due February 15, 2033 |
| Benchmark Treasury Price and Yield: | 99-02+; 3.611% |
| Reopening: | The 2035 Global Bonds constitute a further issuance of, and will form a single series with, the U.S.$1,500,000,000 aggregate principal amount of Panama's 6.400% Global Bonds due 2035 issued on November 21, 2022. |

---

------

---

| | |
|:---|:---|
| Listing and Trading: | Application will be made to list the 2035 Global Bonds on the Official List of the Luxembourg Stock Exchange and to have the 2035 Global Bonds admitted to trading on the Euro MTF Market. |
| Optional Redemption: | Prior to November 14, 2034 (three months prior to their maturity date) (the "2035 Par Call Date"), Panama may redeem the 2035 Global Bonds at its option, in whole or in part, at any time and from time to time, at a redemption price (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of:<br>(1) (a) the sum of the present values of the remaining scheduled payments of principal and interest thereon discounted to the redemption date (assuming the 2035 Global Bonds matured on the 2035 Par Call Date) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 40 basis points less (b) interest accrued to the date of redemption, and<br>(2) 100% of the principal amount of the 2035 Global Bonds to be redeemed,<br>plus, in either case, accrued and unpaid interest thereon to the redemption date.<br> On or after the 2035 Par Call Date, the Republic may redeem the 2035 Global Bonds, in whole or in part, at any time and from time to time, at a redemption price equal to 100% of the principal amount of the 2035 Global Bonds being redeemed plus accrued and unpaid interest thereon to the redemption date.<br>The following terms shall have the following meanings:<br>"Treasury Rate" means, with respect to any redemption date, the yield determined by the Republic, in accordance with the following two paragraphs.<br>The Treasury Rate shall be determined by the Republic after 4:15 p.m., New York City time (or after such time as yields on U.S. government securities are posted daily by the Board of Governors of the Federal Reserve System), on the third business day preceding the redemption date based upon the yield or yields for the |

---

------

most recent day that appear after such time on such day in the most recent statistical release published by the Board of Governors of the Federal Reserve System designated as "Selected Interest Rates (Daily)—H.15" (or any successor designation or publication) ("H.15") under the caption "U.S. government securities–Treasury constant maturities–Nominal" (or any successor caption or heading). In determining the Treasury Rate, the Republic shall select, as applicable: (1) the yield for the Treasury constant maturity on H.15 exactly equal to the period from the redemption date to the 2035 Par Call Date (the "Remaining Life"); or (2) if there is no such Treasury constant maturity on H.15 exactly equal to the Remaining Life, the two yields – one yield corresponding to the Treasury constant maturity on H.15 immediately shorter than and one yield corresponding to the Treasury constant maturity on H.15 immediately longer than the Remaining Life – and shall interpolate to the 2035 Par Call Date on a straight-line basis (using the actual number of days) using such yields and rounding the result to three decimal places; or (3) if there is no such Treasury constant maturity on H.15 shorter than or longer than the Remaining Life, the yield for the single Treasury constant maturity on H.15 closest to the Remaining Life. For purposes of this paragraph, the applicable Treasury constant maturity or maturities on H.15 shall be deemed to have a maturity date equal to the relevant number of months or years, as applicable, of such Treasury constant maturity from the redemption date.<br>If on the third business day preceding the redemption date H.15 or any successor designation or publication is no longer published, the Republic shall calculate the Treasury Rate based on the rate per annum equal to the semi-annual equivalent yield to maturity at 11:00 a.m., New York City time, on the second business day preceding such redemption date of the United States Treasury security maturing on, or with a maturity that is closest to, the 2035 Par Call Date, as applicable. If there is no United States Treasury security maturing on the 2035 Par Call Date but there are two or more United States Treasury securities with a maturity date equally distant from the 2035 Par Call Date, one with a maturity date preceding the 2035 Par Call Date and one with a maturity date following the 2035 Par Call Date, the<br>

------

Republic shall select the United States Treasury security with a maturity date preceding the 2035 Par Call Date. If there are two or more United States Treasury securities maturing on the 2035 Par Call Date or two or more United States Treasury securities meeting the criteria of the preceding sentence, the Republic shall select from among these two or more United States Treasury securities the United States Treasury security that is trading closest to par based upon the average of the bid and asked prices for such United States Treasury securities at 11:00 a.m., New York City time. In determining the Treasury Rate in accordance with the terms of this paragraph, the semi-annual yield to maturity of the applicable United States Treasury security shall be based upon the average of the bid and asked prices (expressed as a percentage of principal amount) at 11:00 a.m., New York City time, of such United States Treasury security, and rounded to three decimal places.<br>The Republic's actions and determinations in determining the redemption price shall be conclusive and binding for all purposes, absent manifest error.<br>Notice of any redemption will be mailed or electronically delivered (or otherwise transmitted in accordance with the depositary's procedures) at least 10 days but not more than 60 days before the redemption date to each holder of the 2035 Global Bonds to be redeemed.<br>In the case of a partial redemption, selection of the 2035 Global Bonds for redemption will be made pro rata, by lot or by such other method as the Fiscal Agent in its sole discretion deems appropriate and fair. No 2035 Global Bonds of a principal amount of $200,000 or less will be redeemed in part. If any 2035 Global Bond is to be redeemed in part only, the notice of redemption that relates to the 2035 Global Bond will state the portion of the principal amount of the 2035 Global Bond to be redeemed. A new 2035 Global Bond in a principal amount equal to the unredeemed portion of the 2035 Global Bonds will be issued in the name of the holder of the 2035 Global Bond upon surrender for cancellation of the original 2035 Global Bond. For so long as the 2035 Global Bonds are held by DTC (or another depositary), the redemption of the 2035 Global Bonds shall be done in accordance with the policies and procedures of the depositary.<br>

------

---

| | |
|:---|:---|
|  | Unless the Republic defaults in payment of the redemption price, on and after the redemption date interest will cease to accrue on the 2035 Global Bonds or portions thereof called for redemption. |
| Use of Proceeds: | Panama will use the proceeds from the 2035 Global Bonds for general budgetary purposes and liability management transactions. |
| Governing Law: | State of New York |
| Underwriting Fee: | 0.050% |
| Form: | Book-Entry Only, registered in the name of Cede & Co., as the nominee of DTC |
| Denominations: | U.S.$200,000 and integral multiples of U.S.$1,000 in excess thereof. |
| Interest Payment Dates: | February 14 and August 14 of each year |
| First Coupon Payment Date: | August 14, 2023 |
| Settlement Date: | March 28, 2023 (T+5) |
| CUSIP/ISIN: | 698299 BT0 / US698299BT07 |

---

Under the terms and subject to the conditions contained in an Underwriting Agreement incorporated by reference in the Terms Agreement, dated March 21, 2023, Goldman Sachs & Co. LLC and Scotia Capital (USA) Inc. as the underwriters have severally agreed to purchase and the Republic of Panama has agreed to sell to the underwriters, the principal amount of the 2035 Global Bonds indicated below:

Underwriters:

---

| | | |
|:---|:---|:---|
|  Goldman Sachs & Co. LLC | U.S.$| 400000000.0 |
|  Scotia Capital (USA) Inc. | U.S.$| 400000000.0 |
|  **Total** | U.S.$| 800000000.0 |

---

\* Note: A securities rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time. Each securities rating should be evaluated independent of each other securities rating.

The Republic has announced a tender offer to purchase for cash up to U.S.$400 million principal amount of its 4.95% Treasury Bonds due 2024 (the "Local Offer"), subject to the terms and conditions of such offer. This Term Sheet does not constitute a solicitation of an offer to sell any securities of the Republic in the Local Offer.

------

Goldman Sachs & Co. LLC and Scotia Capital (USA) Inc. are <u>not</u> acting as dealer managers in connection with the Local Offer.

A preliminary prospectus supplement of the Republic of Panama accompanies the free-writing prospectus and is available from the SEC's website at https://www.sec.gov/Archives/edgar/data/76027/000119312523075368/d478070d424b3.htm.

The issuer has filed a registration statement (including a prospectus) with the Securities and Exchange Commission for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the Securities and Exchange Commission for more complete information about the issuer and this offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, the issuer, any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by calling, toll-free, Goldman Sachs & Co. LLC at +1 (800) 828-3182 or Scotia Capital (USA) Inc. at +1 (800) 372-3930.

Any disclaimer or other notice that may appear below is not applicable to this communication and should be disregarded. Such disclaimer or other notice was automatically generated as a result of this communication being sent via Bloomberg or another email system.

------

**Republic of Panama** 

**U.S.$1,000,000,000 6.853% Global Bonds due 2054** 

**March 21, 2023** 

<u>Term Sheet</u> 

---

| | |
|:---|:---|
| Issuer: | Republic of Panama ("Panama" or the "Republic") |
| Transaction: | 6.853% Global Bonds due 2054 (the "2054 Global Bonds") |
| Distribution: | SEC-Registered Global Bonds |
| Ranking: | Senior Unsecured |
| Expected Ratings\*: | [*Intentionally omitted*] |
| Amount Issued: | U.S.$1,000,000,000 aggregate principal amount |
| Coupon: | 6.853% (30/360 day count basis) |
| Maturity: | March 28, 2054<br>The Republic will repay the principal of the 2054 Global Bonds in three equal annual installments on March 28 of each year, commencing on March 28, 2052. |
| Offering Price: | 100.000% of principal amount plus accrued interest, if any, from March 28, 2023 |
| Gross Proceeds to the Issuer <br>(before deducting underwriting fees and other offering expenses): | U.S.$1,000,000,000 |
| Yield to Maturity: | 6.853% |
| Spread to Benchmark Treasury: | 312.5 basis points |
| Benchmark Treasury: | 4.000% due November 15, 2052 |
| Benchmark Treasury Price and Yield: | 104-27; 3.728% |
| Listing and Trading: | Application will be made to list the 2054 Global Bonds on the Official List of the Luxembourg Stock Exchange and to have the 2054 Global Bonds admitted to trading on the Euro MTF Market. |
| Optional Redemption: | Prior to September 28, 2053 (six months prior to their final maturity date) (the "2054 Par Call Date"), the Republic may redeem the 2054 Global Bonds at its option, in whole or in part, at any time and from time to time, at a redemption price (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of:<br>(1) (a) the sum of the present values of the remaining scheduled payments of principal and interest thereon discounted to the redemption date (assuming the 2054 Global Bonds matured on the 2054 Par Call Date) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 50 basis points less (b) interest accrued to the date of redemption, and |

---

------

<br> (2) 100% of the principal amount of the 2054 Global Bonds to be redeemed,<br>plus, in either case, accrued and unpaid interest thereon to the redemption date.<br>On or after the 2054 Par Call Date, the Republic may redeem the 2054 Global Bonds, in whole or in part, at any time and from time to time, at a redemption price equal to 100% of the principal amount of the 2054 Global Bonds being redeemed plus accrued and unpaid interest thereon to the redemption date.<br>The following terms shall have the following meanings:<br>"Treasury Rate" means, with respect to any redemption date, the yield determined by the Republic, in accordance with the following two paragraphs.<br>The Treasury Rate shall be determined by the Republic after 4:15 p.m., New York City time (or after such time as yields on U.S. government securities are posted daily by the Board of Governors of the Federal Reserve System), on the third business day preceding the redemption date based upon the yield or yields for the most recent day that appear after such time on such day in the most recent statistical release published by the Board of Governors of the Federal Reserve System designated as "Selected Interest Rates (Daily)—H.15" (or any successor designation or publication) ("H.15") under the caption "U.S. government securities–Treasury constant maturities–Nominal" (or any successor caption or heading). In determining the Treasury Rate, the Republic shall select, as applicable: (1) the yield for the Treasury constant maturity on H.15 exactly equal to the<br>

------

period (the "Remaining Life") from the redemption date to the date that reflects the remaining Weighted Average Life of the 2054 Global Bonds (assuming the last amortization payment on the 2054 Global Bonds is made on the 2054 Par Call Date) (the "WAL Date"); or (2) if there is no such Treasury constant maturity on H.15 exactly equal to the Remaining Life, the two yields – one yield corresponding to the Treasury constant maturity on H.15 immediately shorter than and one yield corresponding to the Treasury constant maturity on H.15 immediately longer than the Remaining Life – and shall interpolate to the WAL Date on a straight-line basis (using the actual number of days) using such yields and rounding the result to three decimal places; or (3) if there is no such Treasury constant maturity on H.15 shorter than or longer than the Remaining Life, the yield for the single Treasury constant maturity on H.15 closest to the Remaining Life. For purposes of this paragraph, the applicable Treasury constant maturity or maturities on H.15 shall be deemed to have a maturity date equal to the relevant number of months or years, as applicable, of such Treasury constant maturity from the redemption date.<br>If on the third business day preceding the redemption date H.15 or any successor designation or publication is no longer published, the Republic shall calculate the Treasury Rate based on the rate per annum equal to the semi-annual equivalent yield to maturity at 11:00 a.m., New York City time, on the second business day preceding such redemption date of the United States Treasury security maturing on, or with a maturity that is closest to, the WAL Date, as applicable. If there is no United States Treasury security maturing on the WAL Date but there are two or more United States Treasury securities with a maturity date equally distant from the WAL Date, one with a maturity date preceding the WAL Date and one with a maturity date following the WAL Date, the Republic shall select the United States Treasury security with a maturity date preceding the WAL Date. If there are two or more United States Treasury securities maturing on the WAL Date or two or more United States Treasury securities meeting the criteria of the preceding sentence, the Republic shall select from among these two or more United States Treasury securities the United<br>

------

States Treasury security that is trading closest to par based upon the average of the bid and asked prices for such United States Treasury securities at 11:00 a.m., New York City time. In determining the Treasury Rate in accordance with the terms of this paragraph, the semi-annual yield to maturity of the applicable United States Treasury security shall be based upon the average of the bid and asked prices (expressed as a percentage of principal amount) at 11:00 a.m., New York City time, of such United States Treasury security, and rounded to three decimal places.<br>"Weighted Average Life" at any date means the number of years obtained by dividing: (1) the sum of the products obtained by multiplying (a) the amount of each then remaining installment in respect of the 2054 Global Bonds, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such installment payment; by (2) the then outstanding principal amount of the 2054 Global Bonds.<br>The Republic's actions and determinations in determining the redemption price shall be conclusive and binding for all purposes, absent manifest error.<br>Notice of any redemption will be mailed or electronically delivered (or otherwise transmitted in accordance with the depositary's procedures) at least 10 days but not more than 60 days before the redemption date to each holder of the 2054 Global Bonds to be redeemed.<br>In the case of a partial redemption, selection of the 2054 Global Bonds for redemption will be made pro rata, by lot or by such other method as the Fiscal Agent in its sole discretion deems appropriate and fair. No 2054 Global Bonds of a principal amount of $200,000 or less will be redeemed in part. If any 2054 Global Bond is to be redeemed in part only, the notice of redemption that relates to the 2054 Global Bond will state the portion of the principal amount of the 2054 Global Bond to be redeemed. A new 2054 Global Bond in a principal amount equal to the unredeemed portion of the 2054 Global Bonds will be issued in the name of the holder of the 2054 Global Bond upon surrender for cancellation of<br>

------

---

| | |
|:---|:---|
|  | the original 2054 Global Bond. For so long as the 2054 Global Bonds are held by DTC (or another depositary), the redemption of the 2054 Global Bonds shall be done in accordance with the policies and procedures of the depositary.<br>Unless the Republic defaults in payment of the redemption price, on and after the redemption date interest will cease to accrue on the 2054 Global Bonds or portions thereof called for redemption. |
| Use of Proceeds: | Panama will use the proceeds from the 2054 Global Bonds for general budgetary purposes and liability management transactions. |
| Governing Law: | State of New York |
| Underwriting Fee: | 0.050% |
| Form: | Book-Entry Only, registered in the name of Cede & Co., as the nominee of DTC |
| Denominations: | U.S.$200,000 and integral multiples of U.S.$1,000 in excess thereof. |
| Interest Payment Dates: | March 28 and September 28 of each year |
| First Coupon Payment Date: | September 28, 2023 |
| Settlement Date: | March 28, 2023 (T+5) |
| CUSIP/ISIN: | 698299 BV5 / US698299BV52 |

---

Under the terms and subject to the conditions contained in an Underwriting Agreement incorporated by reference in the Terms Agreement, dated March 21, 2023, Goldman Sachs & Co. LLC and Scotia Capital (USA) Inc. as the underwriters have severally agreed to purchase and the Republic of Panama has agreed to sell to the underwriters, the principal amount of the 2054 Global Bonds indicated below:

Underwriters:

---

| | | |
|:---|:---|:---|
|  Goldman Sachs & Co. LLC | U.S.$| 500000000.0 |
|  Scotia Capital (USA) Inc. | U.S.$| 500000000.0 |
|  Total | U.S.$| 1000000000.0 |

---

\* Note: A securities rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time. Each securities rating should be evaluated independent of each other securities rating.

------

The Republic has announced a tender offer to purchase for cash up to U.S.$400 million principal amount of its 4.95% Treasury Bonds due 2024 (the "Local Offer"), subject to the terms and conditions of such offer. This Term Sheet does not constitute a solicitation of an offer to sell any securities of the Republic in the Local Offer.

Goldman Sachs & Co. LLC and Scotia Capital (USA) Inc. are <u>not</u> acting as dealer managers in connection with the Local Offer.

A preliminary prospectus supplement of the Republic of Panama accompanies the free-writing prospectus and is available from the SEC's website at https://www.sec.gov/Archives/edgar/data/76027/000119312523075368/d478070d424b3.htm.

The issuer has filed a registration statement (including a prospectus) with the Securities and Exchange Commission for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the Securities and Exchange Commission for more complete information about the issuer and this offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, the issuer, any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by calling, toll-free, Goldman Sachs & Co. LLC at +1 (800) 828-3182 or Scotia Capital (USA) Inc. at +1 (800) 372-3930.

Any disclaimer or other notice that may appear below is not applicable to this communication and should be disregarded. Such disclaimer or other notice was automatically generated as a result of this communication being sent via Bloomberg or another email system.

------

SCHEDULE D TO THE

TERMS AGREEMENT

REPUBLIC OF PANAMA

UNDERWRITING AGREEMENT

Dear Sirs:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Introductory</u>. The Republic of Panama (the "Republic") proposes to issue and sell from time to time certain of its unsecured debt securities registered under the registration statement referred to in Section 2(a) ("Registered Securities"). The Registered Securities will be issued under a fiscal agency agreement (the "Fiscal Agency Agreement"), dated as of September 26, 1997, between the Republic and the fiscal agent (the "Fiscal Agent"), The Chase Manhattan Bank, in one or more series, which series may vary as to interest rates, maturities, redemption provisions, selling prices and other terms, with all such terms for any particular series of the Registered Securities being determined at the time of sale. Particular series of the Registered Securities will be sold pursuant to a Terms Agreement referred to in Section 3, for resale in accordance with terms of the offering determined at the time of sale.

The Registered Securities involved in any such offering are hereinafter referred to as the "Offered Securities". The firm or firms which agree to purchase the Offered Securities are hereinafter referred to as the "Underwriters" of such securities, and the representative or representatives of the Underwriters, if any, specified in a Terms Agreement referred to in Section 3 are hereinafter referred to as the "Representatives"; <u>provided</u>, <u>however</u>, that, if the Terms Agreement does not specify any representative of the Underwriters, the term "Representatives", as used in this Agreement (other than in Sections 2(b), 7 and 14 and the second sentence of Section 3) shall mean the Underwriters.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Representations and Warranties of the Republic</u>. The Republic, as of the date of each Terms Agreement referred to in Section 3, represents and warrants to, and agrees with, each Underwriter that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Republic meets the requirements for use of Schedule B under the Securities Act of 1933, as amended (the "Act"), and has filed with the Commission registration statement(s) on Schedule B relating to the Registered Securities; such registration statements and any post-effective amendment thereto, each in the form heretofore delivered to you or your counsel, have been declared effective by the Commission in such form; no other document with respect to such registration statements as amended, or document incorporated by reference therein, has been filed with the

------

Commission after the date hereof (other than prospectuses filed pursuant to Rule 424(b) of the rules and regulations of the Commission under the Act, each in the form heretofore delivered to you or your counsel); and no stop order suspending the effectiveness of such registration statements has been issued and no proceeding for that purpose has been initiated or threatened by the Commission. Such registration statements, as amended at the time of any Terms Agreement referred to in Section 3, are hereinafter collectively referred to as the "Registration Statement", and the prospectus included in such Registration Statement, as supplemented as contemplated by Section 3 to reflect the terms of the Offered Securities and the terms of offering thereof, as first filed with the Commission pursuant to and in accordance with Rule 424(b) ("Rule 424(b)") under the Act, including all material incorporated by reference therein, is hereinafter referred to as the "Prospectus".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) On the effective date of the Registration Statement relating to the Registered Securities, such Registration Statement conformed in all material respects to the requirements of the Act and the rules and regulations of the Commission ("Rules and Regulations") and did not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, and on the date of each Terms Agreement referred to in Section 3 the Registration Statement and the Prospectus will conform, in all material respects, to the requirements of the Act and the Rules and Regulations thereunder, and neither of such documents includes or will include any untrue statement of a material fact or omits or will omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, except that the foregoing does not apply to statements in or omissions from any of such documents based upon written information furnished to the Republic by any Underwriter through the Representatives, if any, specifically for use therein, it being understood and agreed that the only such information is that described in the applicable Terms Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Since the respective dates as of which information is given in the Registration Statement and the Prospectus, there has not been any material adverse change, or any event that would reasonably be expected to result in a prospective material adverse change, in the financial, economic or fiscal condition of the Republic, otherwise than as set forth in or contemplated in the Prospectus.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The execution and delivery of the Terms Agreement (including the provisions of this Agreement) and any Delayed Delivery Contracts (as defined below) and all other documents to be executed or delivered by the Republic hereunder have been duly authorized and have been or will be duly executed and delivered by the Republic, and the Terms Agreement and any Delayed Delivery Contracts constitute the valid and binding agreements of the Republic.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The Registered Securities have been duly authorized, and, when Offered Securities are issued and delivered pursuant to this Agreement and the Terms Agreement with respect to such Offered Securities, such Offered Securities will have been duly executed, authenticated, issued, paid for and delivered against payment therefor in accordance with the Fiscal Agency Agreement and will constitute valid and legally binding obligations of the Republic entitled to the benefits provided by the Fiscal Agency Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) The Fiscal Agency Agreement has been duly authorized, executed and delivered and constitutes a valid and legally binding instrument, enforceable in accordance with its terms, subject, as to enforcement, to bankruptcy, insolvency, reorganization, moratorium and other laws of general applicability relating to or affecting creditors' rights and to general equity principles; and the Fiscal Agency Agreement (to the extent the provisions thereof are applicable to the Offered Securities) and the Offered Securities conform to the descriptions thereof contained in the Prospectus with respect to the Offered Securities; and the statements made under the captions "Description of the Debt Securities" in the Prospectus and "Description of the Offered Securities" in the Prospectus Supplement, insofar as they purport to summarize the terms of the Offered Securities, constitute accurate, complete and fair summaries of such terms.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) All consents, approvals, authorizations, orders, registrations, clearances or qualifications ("Governmental Authorizations") of or with any court, ministry or governmental agency or other regulatory body ("Governmental Agency") in the Republic required for the issue and sale of the Offered Securities or the consummation by the Republic of the transactions contemplated by the Terms Agreement (including the provisions of this Agreement), any Delayed Delivery Contracts, the Fiscal Agency Agreement or the Offered Securities, including without limitation the payment of interest and principal to the holders of the Offered Securities outside the Republic in accordance with the terms thereof, have been obtained and are in full force and effect; and the issue and sale of the Offered Securities and the consummation by the Republic of the transactions contemplated by the Terms Agreement (including this Agreement), any Delayed Delivery Contracts, the Fiscal Agency Agreement or the Offered Securities will be in compliance with all laws, decrees and regulations of the Republic or of any Governmental Agency in the Republic.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) The full faith and credit of the Republic has been pledged for the due and punctual payment of amounts due in respect of the Offered Securities; the Offered Securities will rank <u>pari</u> <u>passu</u> in right of payment with all other indebtedness issued in accordance with the Fiscal Agency Agreement and with all other unsecured and unsubordinated Indebtedness of the Republic. For purposes of this paragraph, "Indebtedness" means any payment obligation of the Republic (whether pursuant to a guarantee or otherwise), including any contingent liability, for borrowed money or arising from bonds, debentures, notes or similar instruments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Other than as set forth in the Prospectus, there are no legal or governmental actions, suits, arbitrations or proceedings pending to which the Republic is a party which, if determined adversely to the Republic, would individually or in the aggregate have a material adverse effect on the financial, economic or fiscal condition of the Republic or its ability to perform its obligations under the Terms Agreement, any Delayed Delivery Contracts, the Fiscal Agency Agreement or the Offered Securities or which are otherwise material to the rights of holders of the Offered Securities; and, to the best of the Republic's knowledge, no such actions, suits, arbitrations or proceedings are threatened which, if determined adversely to the Republic, would individually or in the aggregate have a material adverse effect on the financial, economic or fiscal condition of the Republic or its ability to perform its obligations under the Terms Agreement, any Delayed Delivery Contracts, the Fiscal Agency Agreement or the Offered Securities or which are otherwise material to the rights of holders of the Offered Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) Other than as set forth in the Prospectus, the Republic is not in default in the payment of principal, interest or any other amount owing on any obligation in respect of indebtedness for money borrowed and the Republic has not received any notice of default or acceleration with respect to any obligation in respect of indebtedness for money borrowed, in each case or in the aggregate, which would have a material adverse effect on the financial, economic or fiscal condition of the Republic or its ability to perform its obligations under the Terms Agreement, any Delayed Delivery Contracts, the Fiscal Agency Agreement or the Offered Securities or which is otherwise material to the rights of the holders of the Offered Securities; and the issue and sale of the Offered Securities and the compliance by the Republic with all of the provisions of the Terms Agreement, any Delayed Delivery Contracts, the Fiscal Agency Agreement and the Offered Securities and the consummation of the transactions herein and therein contemplated will not conflict with or result in a breach of any of the terms or provisions of, or constitute a default under, the Constitution of the Republic, as amended to the date of the Terms Agreement, any statutes, laws, decrees or regulations of the Republic or any treaty, convention or agreement to which the Republic is a party or to which any property of the

------

Republic is subject and which default, in each case or in the aggregate, would have a material adverse effect on the financial, fiscal or economic condition of the Republic or its ability to perform its obligations under the Terms Agreement, any Delayed Delivery Contracts, the Fiscal Agency Agreement or the Offered Securities or which is otherwise material to the rights of the holders of the Offered Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) To ensure the legality, validity, enforceability, priority or admissibility in evidence in the Republic of the Terms Agreement, any Delayed Delivery Contracts, the Fiscal Agency Agreement, the Offered Securities or any other document or instrument related to the offer and sale of the Offered Securities, it is not necessary that the Terms Agreement, any Delayed Delivery Contracts, the Fiscal Agency Agreement, the Offered Securities or any other documents or instruments be registered, recorded or filed with any court or other authority in the Republic (other than the translation thereof) or that any documentary, stamp or similar tax, imposition or charge be paid on or in respect of the Terms Agreement, the Fiscal Agency Agreement, the Offered Securities or any document or instrument related to the offer and sale of the Offered Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) There is no tax, levy, deduction, charge or withholding imposed by the Republic or any political subdivision thereof either (i) on or by virtue of the execution, delivery or enforcement of the Terms Agreement, the Fiscal Agency Agreement or the Offered Securities or (ii) on any payment to be made by the Republic hereunder or under the Offered Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) Neither the Republic nor any person acting on its behalf has taken, directly or indirectly, any action which might reasonably be expected to cause or result in stabilization of the price of any security of the Republic to facilitate the offer and sale of the Offered Securities or the sale or resale of the Offered Securities; provided, however, that no representation or warranty is given by the Republic with respect to any actions of the Underwriters.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) The Terms Agreement, any Delayed Delivery Contract, the Fiscal Agency Agreement and the Offered Securities are in proper legal form under the laws of the Republic for the enforcement thereof against the Republic under the laws of the Republic.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) No stamp or other issuance or transfer taxes or duties and no capital gains, income, withholding or other taxes are payable by or on behalf of the Underwriters to the Republic or any political subdivision or taxing authority thereof or therein in connection with (i) the issuance, sale and delivery by the Republic to or for the respective accounts of the Underwriters of the Offered Securities issued and sold pursuant to the

------

Terms Agreement or any Delayed Delivery Contract or (ii) the sale and delivery outside the Republic by the Underwriters of the Offered Securities acquired or purchased pursuant to the offer and sale of the Offered Securities to the initial purchasers thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) The Republic is not aware that either S&P Global Ratings ("Standard & Poor's") or Moody's Investors Service, Inc. ("Moody's") has made any announcement that it will have under surveillance or review, with possible negative implications, its rating of any of the Republic's debt securities; and the Republic has not been informed by either Standard & Poor's or Moody's that it intends or is contemplating any downgrading in any rating accorded to the Republic's debt securities or any announcement that it will have under surveillance or review, with possible negative implications, its rating of any of the Republic's debt securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q) The statements with respect to matters of Panamanian law set forth in the Prospectus are correct in all material respects.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(r) The Republic will make such arrangements reasonably necessary to permit settlement to occur in the manner described in the Prospectus.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(s) The Republic shall make generally available to its securityholders as soon as practicable, a statement in the English language of the revenues and expenditures of the Republic covering the first full fiscal year of the Republic commencing after the date of the Terms Agreement which will satisfy Section 11(a) of the Act and the rules and regulations of the Commission thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Purchase and Offering of Offered Securities</u>. The obligation of the Underwriters to purchase the Offered Securities will be evidenced by an agreement or exchange of other written communications (the "Terms Agreement") at the time the Republic determines to sell the Offered Securities. The Terms Agreement will incorporate by reference the provisions of this Agreement, except as otherwise provided therein, and will specify the firm or firms which will be Underwriters, the names of any Representatives, the principal amount to be purchased by each Underwriter, the purchase price to be paid by the Underwriters and the terms of the Offered Securities not already specified in the Fiscal Agency Agreement, including, but not limited to, interest rate, maturity, any redemption provisions and any sinking fund requirements and whether any of the Offered Securities may be sold to institutional investors pursuant to Delayed Delivery Contracts. The Terms Agreement will also specify the time and date of delivery and payment (such time and date, or such other time not later than seven full business days after the time specified in the Terms Agreement by the Underwriter first named in the Terms Agreement (the "Lead Underwriter") and the Republic agrees as the time for payment and delivery, being herein and in the Terms Agreement referred to as the "Closing Date"), the place of delivery and payment and any details of the terms of the offering that should be reflected in the prospectus supplement relating to the offering of the Offered Securities. The obligations of the Underwriters to purchase the Offered Securities will be several and not joint. It is understood that the Underwriters propose to offer the Offered Securities for sale as set forth in the Prospectus.

------

If the Terms Agreement provides for sales of Offered Securities pursuant to delayed delivery contracts, the Republic authorizes the Underwriters to solicit offers to purchase Offered Securities pursuant to delayed delivery contracts substantially in the form of Exhibit I hereto ("Delayed Delivery Contracts") with such changes therein as the Republic may authorize or approve. Delayed Delivery Contracts are to be with institutional investors, including commercial and savings banks, insurance companies, pension funds, investment companies and educational and charitable institutions. On the Closing Date the Republic will pay, as compensation, to the Representatives for the accounts of the Underwriters, the fee set forth in such Terms Agreement in respect of the principal amount of Offered Securities to be sold pursuant to Delayed Delivery Contracts ("Contract Securities"). The Underwriters will not have any responsibility in respect of the validity or the performance of Delayed Delivery Contracts. If the Republic executes and delivers Delayed Delivery Contracts, the Contract Securities will be deducted from the Offered Securities to be purchased by the several Underwriters and the aggregate principal amount of Offered Securities to be purchased by each Underwriter will be reduced <u>pro</u> <u>rata</u> in proportion to the principal amount of Offered Securities set forth opposite each Underwriter's name in such Terms Agreement, except to the extent that the Lead Underwriter determines that such reduction shall be otherwise than <u>pro</u> <u>rata</u> and so advise the Republic. The Republic will advise the Lead Underwriter not later than the business day prior to the Closing Date of the principal amount of Contract Securities.

The Offered Securities delivered to the Underwriters on the Closing Date will be in definitive fully registered form, in such denominations and registered in such names as the Lead Underwriter requests.

If the Terms Agreement specifies "Book-Entry Only" settlement or otherwise states that the provisions of this paragraph shall apply, the Republic will deliver against payment of the purchase price the Offered Securities in the form of one or more permanent global Securities in definitive form (the "Global Securities") deposited with the Fiscal Agent as custodian for The Depository Trust Company ("DTC") and registered in the name of Cede & Co., as nominee for DTC. Interests in any permanent Global Securities will be held only in book-entry form through DTC, except in the limited circumstances described in the Prospectus. Payment for the Offered Securities shall be made by the Underwriters (if the Terms Agreement specifies that the Offered Securities will not trade in DTC's Same Day Funds Settlement System) by certified or official bank check or checks in New York Clearing House (next-day) funds or (if the Terms Agreement specifies that the Offered Securities will trade in DTC's Same Day Funds Settlement System) in Federal (same-day) funds by official check or checks or wire transfer to an account in New York previously designated to the Lead Underwriter by the Republic at a bank acceptable to the Lead Underwriter, in each case drawn to the order of the Republic of Panama at the place of payment specified in the Terms Agreement on the Closing Date, against delivery to the Fiscal Agent, as custodian for DTC, of the Global Securities representing all the Offered Securities.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Certain Agreements of the Republic</u>. The Republic agrees with the several Underwriters that it will furnish to counsel for the Underwriters one copy of the registration statement relating to the Registered Securities, including all exhibits, in the form in which it became effective and of all amendments thereto and that, in connection with each offering of Offered Securities:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Republic will file the Prospectus with the Commission pursuant to and in accordance with Rule 424(b) (2) (or, if applicable and if consented to by the Lead Underwriter, which consent may not be unreasonably withheld, subparagraph (5)) not later than the Commission's close of business on the second business day following the execution and delivery of the Terms Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Republic will advise the Lead Underwriter promptly of any proposal to amend or supplement the Registration Statement or the Prospectus and will not effect such amendment or supplementation without the Lead Underwriter's consent, which consent may not be unreasonably withheld, and the Republic will also advise the Lead Underwriter promptly of the filing of any such amendment or supplement and of the institution by the Commission of any stop order proceedings in respect of the Registration Statement or of any part thereof and will use its best efforts to prevent the issuance of any such stop order and to obtain as soon as possible its lifting, if issued.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If, at any time when a prospectus relating to the Offered Securities is required to be delivered under the Act in connection with sales by any Underwriter or dealer, any event occurs as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if it is necessary at any time to amend the Prospectus to comply with the Act, the Republic promptly will notify the Lead Underwriter of such event and will promptly prepare and file with the Commission, at its own expense, an amendment or supplement which will correct such statement or omission or an amendment which will effect such compliance. Neither the Lead Underwriter's consent to, nor the Underwriters, delivery of, any such amendment or supplement shall constitute a waiver of any of the conditions set forth in Section 6.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Republic will furnish to the Representatives copies of the Registration Statement, each including all exhibits, any related preliminary prospectus, any related preliminary prospectus supplement, the Prospectus and all amendments and supplements to such documents, in each case as soon as available and in such quantities as the Lead Underwriter reasonably requests.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The Republic will arrange for the qualification of the Offered Securities for sale and the determination of their eligibility for investment under the laws of such jurisdictions as the Lead Underwriter designates and will continue such qualification in effect so long as required for the distribution thereof; provided, however, that in connection therewith, the Republic shall not be required to qualify as a foreign corporation or to file a general consent to service of process in any such jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Unless otherwise specified in the Terms Agreement, the Republic will pay all expenses incident to the performance of its obligations under the Terms Agreement (including the provisions of this Agreement), including the cost of printing the documents (including the Registration Statement and Prospectus) and will reimburse the Underwriters (if and to the extent incurred by them) for any filing fees and other expenses (including reasonable fees and disbursements of counsel) incurred by them in connection with qualification of the Registered Securities for sale and determination of their eligibility for investment under the laws of such jurisdictions as the Lead Underwriter may designate and the printing of memoranda relating thereto, for any fees charged by investment rating agencies for the rating of the Offered Securities, for any applicable filing fee, if any, of the National Association of Securities Dealers, Inc. relating to the Registered Securities, for any travel expenses of the Republic's officers and employees and any other expenses of the Republic in connection with attending or hosting meetings with prospective purchasers of Registered Securities and for expenses incurred in distributing the Prospectus, any preliminary prospectuses, any preliminary prospectus supplements or any other amendments or supplements to the Prospectus to the Underwriters. Except as agreed in the Terms Agreement, the Republic will reimburse the Underwriters for their expenses incurred in connection with meetings with prospective purchasers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) The Republic will indemnify and hold harmless the Underwriters against any documentary, stamp or similar issue tax, including any interest and penalties, on the creation, issue and sale of the Offered Securities and on the execution and delivery of the Terms Agreement (including the provisions of this Agreement). All payments to be made by the Republic hereunder or thereunder shall be made without withholding or deduction for or on account of any present or future taxes, duties or governmental charges whatsoever unless the Republic is compelled by law to deduct or withhold such taxes, duties or charges. In that event, the Republic shall pay such additional amounts as may be necessary in order that the net amounts received after such withholding or deduction shall equal the amounts that would have been received if no withholding or deduction had been made.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) Except ****as agreed in the Terms Agreement, during the period beginning from the date hereof and continuing to and including the completion of the distribution as notified to the Republic by the Lead Underwriter (notification to be given as promptly as practicable) the Republic will not offer, sell, contract to sell or otherwise dispose of any debt securities of the Republic, guaranteed by the Republic or of any agency or enterprise controlled by the Republic that are substantially similar to the Offered Securities, are denominated in U.S. dollars, are to be placed outside the Republic and which have tenors substantially similar to the Offered Securities, without the prior written consent of the Lead Underwriter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>General Selling and Other Restrictions</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Underwriter severally represents to and agrees with the Republic that it has not offered, sold or delivered and it will not offer, sell or deliver, directly or indirectly, any of the Offered Securities or distribute the Prospectus, any preliminary prospectus or any other material relating to the Offered Securities, in or from any jurisdiction except under circumstances that will result in compliance with the applicable laws and regulations thereof and which will not impose any obligations on the Republic except as contained in this Agreement. In addition, each Underwriter severally agrees with the Republic to comply with such additional or substitute restrictions on offers and sales of the Offered Securities as may be set forth in the Terms Agreement and to cause each member of the selling group to agree to comply with the restrictions on offers and sales of the Offered Securities set forth in this Section 5 and, if applicable, the Terms Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Underwriter severally represents to and agrees with the Republic to deliver to counsel for the Underwriters for the benefit of the Republic, as soon as practicable following the initial distribution of the Offered Securities (but in no event later than 40 days after the Closing Date), confidential facsimiles enumerating the amount of Offered Securities sold by each of them in the initial distribution in the United States together with an estimate of the number of Offered Securities reasonably expected to be sold within the United States within 40 days of the Closing Date; <u>provided</u>, <u>however</u>, that the Underwriters shall bear no responsibility for any discrepancy between each such estimated amount and the actual amount of Offered Securities sold within the United States in such time period.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. <u>Conditions of the Obligations of the Underwriter</u>. The obligations of the several Underwriters to purchase and pay for the Offered Securities will be subject to the accuracy of the representations and warranties on the part of the Republic herein on and as of the date of the Terms Agreement and the Closing Date, to the accuracy of the statements of the Republic and its officers made pursuant to the provisions hereof, to the performance by the Republic of its obligations hereunder and to the following additional conditions precedent:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All representations and warranties and other statements of the Republic contained in the Terms Agreement (including the provisions of this Agreement) are now, and at all times from the date of the Terms Agreement to the Closing Date will be, true and correct in all material respects (except for those representations, warranties and statements which are by their terms subject to materiality, in which case such representations, warranties or statements shall be true and correct in accordance with their terms).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Prospectus as amended or supplemented with respect to the Offered Securities shall have been filed with the Commission pursuant to Rule 424(b) within the applicable time period prescribed for such filing by the rules and regulations under the Act and in accordance with Section 4(a) hereof; no stop order suspending the effectiveness of the Registration Statement or any part thereof shall have been issued and no proceeding for the purpose shall have been initiated or threatened by the Commission; and all requests for additional information on the part of the Commission shall have been complied with to your reasonable satisfaction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) On the Closing Date, your United States counsel shall have furnished to you such written opinion or opinions, dated the Closing Date, with respect to the validity of the Fiscal Agency Agreement and the Offered Securities, the Registration Statement, the Prospectus and such other related matters as you may reasonably request, and such counsel shall have received such papers and information as they may reasonably request to enable them to pass upon such matters. In rendering their opinions, your United States counsel may rely as to all matters of Panamanian law upon the opinions referred to in paragraphs (d) and (e) of this Section 6.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) On the Closing Date, your Panamanian counsel shall have furnished to you such written opinion or opinions, dated the Closing Date, with respect to the validity of the Terms Agreement, the Fiscal Agency Agreement and the Offered Securities, the Registration Statement, the Prospectus and such other related matters as you may reasonably request, and such counsel shall have received such papers and information as they may reasonably request to enable them to pass upon such matters. In rendering such opinion, such counsel may rely as to all matters of United States Federal and New York State law upon the opinion referred to in paragraph (c) of this Section 6.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) On the Closing Date, the Procurador(a) de la Administración (Attorney General) or in his or her absence, a duly authorized attorney of the Procuraduría de la Administración, shall have furnished to you his or her written opinion, dated the date of delivery thereof, in form and substance satisfactory to you, addressing the matters set forth in Annex I attached hereto. In rendering such opinion, such counsel may state that his or her opinion is limited to matters of Panamanian law and may rely as to all matters of United States Federal and New York law upon the opinion referred to in paragraph (f) of this Section 6.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) On the Closing Date, United States counsel for the Republic shall have furnished to you their written opinion, dated the Closing Date, in form and substance satisfactory to you, addressing the matters set forth in Annex II attached hereto. In rendering such opinion, such counsel may state that their opinion is limited to the Federal laws of the United States and the laws of the State of New York and may rely as to all matters of Panamanian law upon the opinion referred to in paragraph (e) of this Section 6.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) The Republic shall have furnished to you, on the Closing Date, a certificate in English, dated the Closing Date, of the Minister or Vice Minister of Economy and Finance, in which such official shall state that, to the best of his or her knowledge after reasonable investigation: (i) the representations and warranties of the Republic in this Agreement are true and correct in all material respects with the same effect as though such representations and warranties had been made at and as of the respective date of such certificate (other than such representations and warranties which are made as of a specified date), (ii) the Republic has complied with all agreements and satisfied all conditions on its part to be performed or satisfied at or prior to the respective date of such certificate and (iii) no proceeding has been initiated, or to the best of his or her knowledge threatened, to restrain or enjoin the issuance or delivery of the Offered Securities or in any manner to question the laws, proceedings, directives, resolutions, approvals, consents or orders under which the Offered Securities will be issued or to question the validity of the Offered Securities and none of said laws, proceedings, directives, resolutions, approvals, consents or orders has been repealed, revoked or rescinded in whole or in relevant part.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) Since the date of the Terms Agreement there shall not have been any material adverse change, or any prospective material adverse change, in or affecting the financial, economic, fiscal or political condition of the Republic or in Panamanian taxation affecting the Offered Securities, otherwise than as set forth in or contemplated in the Prospectus (as amended or supplemented), the effect of which, in any such case, is in your judgment such as to make it impracticable or inadvisable to proceed with the offer, sale or delivery of the Offered Securities on the terms and in the manner contemplated by the Prospectus (as amended or supplemented).

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Subsequent to the execution and delivery of the Terms Agreement and on or prior to the Closing Date there shall not have occurred any of the following: (A) a suspension or material limitation in trading in securities generally on any of the New York Stock Exchange, the London Stock Exchange or the Luxembourg Stock Exchange; (B) trading of any securities of or guaranteed by the Republic shall have been formally suspended or limited on any international exchange; (C) a general moratorium on commercial banking activities in New York, London or the Republic declared by either United States or New York State authorities or authorities of London or the Republic, respectively; (D) the outbreak or escalation of hostilities involving the United States or the Republic or the declaration by the United States or the Republic of a national emergency or war; (E) the filing of any action or institution of any proceeding by any person or entity against the Republic or any of its property if the effect of any such event specified in clauses (A), (B), (C), (D) or (E) in your judgment makes it impracticable or inadvisable to proceed with the offer, sale or delivery of the Offered Securities on the terms and in the manner contemplated by the Prospectus (as amended or supplemented); or (F) the occurrence of any material adverse change in the existing financial, political or economic conditions in the United States, the Republic or elsewhere which in your sole judgment would materially and adversely affect the international financial markets or the market for the Offered Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) On or after the date of the Terms Agreement and on or prior to the Closing Date (i) no downgrading shall have occurred in the rating accorded the Republic's debt securities by Standard & Poor's or Moody's; (ii) no such organization shall have publicly announced that it has under surveillance or review, with possible negative implications, its rating of any of the Republic's debt securities; (iii) the Republic shall not have been aware that either Standard & Poor's or Moody's has announced that it will have under surveillance or review, with possible negative implications, its rating of any of the Republic's debt securities; and (iv) the Republic shall not have been informed by Standard & Poor's or Moody's that it intends or is contemplating any downgrading in any rating accorded to the Republic's debt securities or any announcement that it will have under surveillance or review, with possible negative implications, its rating of any of the Republic's debt securities.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) The Minister of Economy and Finance or the Vice Minister of Economy or the Vice Minister of Finance shall have furnished to you on the Closing Date, a certificate in English, dated the date of delivery, to the effect that as of its effective date, the Registration Statement and any further amendment thereto made by the Republic did not contain an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein not misleading; that, as of its date, the Prospectus and any further amendment or supplement thereto made by the Republic did not contain an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; that all statistical information in the Registration Statement and the Prospectus and any further amendment or supplement thereto is presented on a basis consistent with public official documents of the Republic; and that, as of the respective date of such certificate neither the Registration Statement nor the Prospectus or any further amendment or supplement thereto made by the Republic contains an untrue statement of a material fact or omits to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, however, that the foregoing certification shall not apply to the statements in or omissions from the Registration Statement or the Prospectus or any amendment or supplement thereto made in reliance upon and in conformity with information furnished to the Republic in writing by you expressly for use in the Registration Statement or the Prospectus or any amendment or supplement thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) The Republic shall have furnished to you on the Closing Date such further information, certificates and documents as you may reasonably request.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. <u>Indemnification and Contribution</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Republic will indemnify and hold harmless each Underwriter against any losses, claims, damages or liabilities, joint or several, to which such Underwriter may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in the Registration Statement, the Prospectus, or any amendment or supplement thereto, or any related preliminary prospectus or preliminary prospectus supplement, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse each Underwriter for any legal or other expenses reasonably incurred by such Underwriter in connection with investigating or defending any such loss, claim, damage, liability or action as such expenses are incurred; provided, however, that the Republic will not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement in or omission or alleged omission from any of

------

such documents in reliance upon and in conformity with written information furnished to the Republic by any Underwriter through the Representatives, if any, specifically for use therein; it being understood and agreed that the only such information furnished by any Underwriter consists of the information described as such in subsection (b) below; and provided, further, that with respect to any untrue statement or omission or alleged untrue statement or omission made in any preliminary prospectus, the indemnity agreement contained in this subsection (a) shall not inure to the benefit of any Underwriter from whom the person asserting any such losses, claims, damages or liabilities purchased the Offered Securities concerned, to the extent that a prospectus relating to such Offered Securities was required to be delivered by such Underwriter under the Act in connection with such purchase and any such loss, claim, damage or liability of such Underwriter results from the fact that there was not sent or given to such person, at or prior to the written confirmation of the sale of such Offered Securities to such person a copy of the Prospectus if the Republic had previously furnished copies thereof to such Underwriters.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Underwriter will severally and not jointly indemnify and hold harmless the Republic against any losses, claims, damages or liabilities to which the Republic may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in the Registration Statement, the Prospectus, or any amendment or supplement thereto, or any related preliminary prospectus or preliminary prospectus supplement or arise out of or are based upon the omission or the alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with written information furnished to the Republic by or on behalf of such Underwriter through the Representatives, if any, specifically for use therein, and will reimburse any legal or other expenses reasonably incurred by the Republic in connection with investigating or defending any such loss, claim, damage, liability or action as such expenses are incurred; it being understood and agreed that the only such information furnished by or on behalf of any Underwriter consists of the information described as such in the Terms Agreement.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Promptly after receipt by an indemnified party under this Section of notice of the commencement of any action, such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under subsection (a) or (b) above, notify the indemnifying party in writing of the commencement thereof, but the omission so to notify the indemnifying party in writing will not relieve it from any liability which it may have to any indemnified party otherwise than under subsection (a) or (b) above. In case any such action is brought against any indemnified party and it notifies the indemnifying party of the commencement thereof, the indemnifying party will be entitled to participate therein and, to the extent that it may wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party, and, after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party will not be liable to such indemnified party under this Section for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof other than reasonable costs of investigation; provided, however, that an indemnifying party shall not, in connection with any one such action or separate but substantially similar actions arising out of the same general allegations, be liable for the fees and expenses of more than one separate firm of attorneys at any time for all indemnified parties, except to the extent that local counsel, in addition to its regular counsel, is required in order to effectively defend against such action. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened action in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party unless such settlement includes an unconditional release of such indemnified party from all liability on any claims that are the subject matter of such action.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) If the indemnification provided for in this Section is unavailable or insufficient to hold harmless an indemnified party under subsection (a) or (b) above, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of the losses, claims, damages or liabilities referred to in subsection (a) or (b) above (i) in such proportion as is appropriate to reflect the relative benefits received by the Republic on the one hand and the Underwriters on the other from the offering of the Offered Securities or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Republic on the one hand and the Underwriters on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities as well as any other relevant equitable considerations. The relative benefits received by the Republic on the one hand and the Underwriters on the other shall be deemed to be in the same proportion as the total net proceeds from the offering (before deducting expenses for which the Republic is responsible under the relevant Terms Agreement) received by the Republic bear to the total underwriting discounts and commissions received by the Underwriters.

------

The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Republic or the Underwriters and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement or omission. The amount paid by an indemnified party as a result of the losses, claims, damages or liabilities referred to in the first sentence of this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any action or claim which is the subject of this subsection (d). Notwithstanding the provisions of this subsection (d), no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Offered Securities underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Underwriters' obligations in this subsection (d) to contribute are several in proportion to their respective underwriting obligations and not joint.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The obligations of the Republic under this Section shall be in addition to any liability which the Republic may otherwise have and shall extend, upon the same terms and conditions, to each person, if any, who controls any Underwriter within the meaning of the Act and to each officer, employee or agent of any Underwriter; and the obligations of the Underwriters under this Section shall be in addition to any liability which the respective Underwriters may otherwise have and shall extend, upon the same terms and conditions, to each official of the Republic who has signed the Registration Statement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. <u>Default of Underwriters</u>. If any Underwriter or Underwriters default in their obligations to purchase Offered Securities under the Terms Agreement and the aggregate principal amount of the Offered Securities that such defaulting Underwriter or Underwriters agreed but failed to purchase does not exceed 10% of the total principal amount of the Offered Securities that the Underwriters are obligated to purchase, the Lead Underwriter may make arrangements satisfactory to the Republic for the purchase of such Offered Securities by other persons, including any of the Underwriters, but if no such arrangements are made by the Closing Date, the nondefaulting Underwriters shall be obligated severally, in proportion to their respective commitments under the Terms Agreement (including the provisions of this Agreement), to purchase the Offered Securities that such defaulting Underwriters agreed but failed to purchase. If any Underwriter or Underwriters so default and the aggregate principal amount of Offered Securities with

------

respect to which such default or defaults occur exceeds 10% of the total principal amount of the Offered Securities and arrangements satisfactory to the Lead Underwriter and the Republic for the purchase of such Offered Securities by other persons are not made within 36 hours after such default, the Terms Agreement (including the provisions of this Agreement) will terminate without liability on the part of any non-defaulting Underwriter or the Republic, except as provided in Section 9. As used in the Terms Agreement (including the provisions of this Agreement), the term "Underwriter" includes any person substituted for an Underwriter under this Section. Nothing herein will relieve a defaulting Underwriter from liability for its default. The respective commitments of the several Underwriters for the purposes of this Section shall be determined without regard to reduction in the respective Underwriters' obligations to purchase the principal amounts of the Offered Securities set forth opposite their names in the Terms Agreement as a result of Delayed Delivery Contracts entered into by the Republic.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. <u>Survival of Certain Representations and Obligations</u>. The respective indemnities, agreements, representations, warranties and other statements of the Republic or its officials and of the several Underwriters set forth in or made pursuant to the Terms Agreement (including the provisions of this Agreement) will remain in full force and effect, regardless of any investigation, or statement as to the results thereof, made by or on behalf of any Underwriter, the Republic or any of their respective representatives, officers, officials or directors or any controlling person, and will survive delivery of and payment for the Offered Securities. If the Terms Agreement is terminated pursuant to Section 8 or if for any reason the purchase of the Offered Securities by the Underwriters is not consummated, the Republic shall remain responsible for the expenses to be paid or reimbursed by it pursuant to Section 4 (as it may be modified by the applicable Terms Agreement) and the respective obligations of the Republic and the Underwriters pursuant to Section 7 shall remain in effect. Except as agreed in the Terms Agreement, if the purchase of the Offered Securities by the Underwriters is not consummated for any reason other than solely because of the termination of the Terms Agreement pursuant to Section 8 or the occurrence of any event specified in clause (A), (B) or (C) of Section 6(i), the Republic will reimburse the Underwriters for all out-of-pocket expenses (including fees and disbursements of counsel) reasonably incurred by them in connection with the offering of the Offered Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. <u>Notices</u>. All communications hereunder will be in writing and, if sent to the Underwriters, will be mailed, delivered or telegraphed and confirmed to them at their address furnished to the Republic in writing for the purpose of communications hereunder or, if sent to the Republic, will be mailed, delivered or telegraphed and confirmed to it at the Republic of Panama, Director of Public Credit, Dirección de Crédito Público, Ministerio de Planificación y Política Economica, Via España y Calle 52, Edificio Ogawa, Panama 3, Panama (507) 507-7202.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. <u>Successors</u>. The Terms Agreement (including the provisions of this Agreement) will inure to the benefit of and be binding upon the Republic and such Underwriters as are identified in the Terms Agreement and their respective successors and the officers and directors and controlling persons referred to in Section 7, and no other person will have any right or obligation hereunder.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. <u>Jurisdiction; Service of Process; Etc</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Republic irrevocably submits to the non-exclusive jurisdiction of any New York State or federal court sitting in The City of New York and any court sitting in the Republic of the Republic, and any appellate court from any thereof, in any suit, action or proceeding arising out of or relating to this Agreement (a "Related Proceeding") and hereby irrevocably agrees that all claims in respect of any Related Proceeding may be heard and determined in such New York State or federal court or any court sitting in the Republic of the Republic as the person bringing such Related Proceeding may elect in its sole discretion (the "Specified Courts"). The Republic also agrees that any judgment obtained in any of the Specified Courts arising out of any Related Proceeding may be enforced or executed in any other court of competent jurisdiction whatsoever, and any judgment obtained in any such other court as a result of such enforcement or execution may be enforced or executed in any such other court of competent jurisdiction (all courts other than Specified Courts being herein called "Other Courts"), by means of a suit on the judgment or in any other manner provided by law. The Republic hereby irrevocably submits to the exclusive jurisdiction of each of the Specified Courts for the purpose of any Related Proceeding and, solely for the purpose of enforcing or executing any judgment referred to in the preceding sentence (a "Related Judgment"), of each Specified Court and each Other Court. The Agreement made by the Republic with respect to jurisdiction is made solely with respect to Related Proceedings and the enforcement or execution of Related Judgments and under no circumstances shall it be interpreted as a general agreement by the Republic with respect to proceedings unrelated to the Terms Agreement (including the provisions of this Agreement). The Republic hereby irrevocably waives, to the fullest extent it may effectively do so, the defense of an inconvenient forum to the maintenance of any Related Proceeding and any objection to any Related Proceeding whether on the grounds of venue, residence or domicile.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Republic hereby appoints and agrees to maintain the person for the time being and from time to time acting as or discharging (i) the function of Consul General of the Republic in The City of New York with an office on the date hereof at 1212 Avenue of the Americas, 10th floor, New York, New York 10036, United States, as its agent (the "Authorized Agent") to receive on behalf of the Republic and its property service of copies of the summons and complaint and any other process which may be served in any Related Proceeding in such New York State or federal court sitting in The City of New York. The Republic hereby agrees

------

that such service may be made by registered mail or by delivering by hand a copy of such process to the Republic in care of the Authorized Agent at the address specified above for the Authorized Agent (and the Republic hereby agrees that such service will be effective upon the mailing or delivery by hand of such process to the office of the Authorized Agent), and the Republic hereby authorizes and directs the Authorized Agent to accept on its behalf such service. The Republic hereby agrees that failure of the Authorized Agent to give notice to the Republic, or failure of the Republic to receive notice of such service of process, shall not affect in any way the validity of such service on the Authorized Agent or the Republic. The Republic hereby irrevocably consents to the service of any and all process in any Related Proceeding by sending by registered mail copies of such process to the Republic at the Ministry of Planning and Economic Policy (and the Republic hereby agrees that such service will be effective seven days after mailing thereof). The Republic hereby covenants and agrees that it shall take any and all reasonable action, including the execution and filing of any and all documents, that may be necessary to continue the designation of the Authorized Agent in full force and effect, and to cause the Authorized Agent to continue to act as such. In addition, the Republic hereby agrees that no documents or agreements to which it is a party or to which it or its property is subject shall affect the right of any party to serve legal process in any other manner permitted by law or affect the right of any party to bring any suit, action or proceeding against any other party or its property in the courts of any other jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) To the extent that the Republic has or hereafter may acquire any immunity (sovereign or otherwise) from jurisdiction of any court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution, execution or otherwise) with respect to itself or its property, the Republic hereby irrevocably agrees not to claim and will irrevocably waive such immunity in respect of any Related Proceeding, and, without limiting the generality of the foregoing, the Republic hereby agrees that such waivers shall have the fullest scope permitted under the Foreign Sovereign Immunities Act of 1976 of the United States and are intended to be irrevocable for purposes of such Act. Notwithstanding the foregoing, the execution on or attachment of revenues, assets and property of the Republic located in the Republic through the courts of the Republic, both prior to and post-judgment, shall be subject to the provisions of Articles 1047, 1048, 1650 and 1939 of the Judicial Code of the Republic of Panama.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Notwithstanding the foregoing, the Republic does not consent to service of process or waive sovereign immunity with respect to actions brought against it under United States federal securities laws or any securities laws of any States of the United States, and the Republic's

------

appointment of the Authorized Agent hereunder does not extend to such actions. In addition, the Republic agrees that it will not bring any suit, action or proceeding arising out of or related to the Terms Agreement against any Underwriter in the Republic and that any such suit, action or proceeding against any Underwriter shall be brought only in a State or federal court in The City of New York, New York; provided that, if any Underwriter brings any suit, action or proceeding arising out of or related to the Terms Agreement against the Republic in any court in the Republic of Panama (other than any proceeding solely to object to the exercise of jurisdiction by any such court), the foregoing agreement of the Republic shall not extend to any counterclaim or other claims the Republic may have against the Underwriters. The Underwriters irrevocably submit to the exclusive jurisdiction of any State or federal court in The City of New York in any such suit, action or proceeding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. <u>English Documents</u>. All documents to be delivered under or pursuant to any provision of the Terms Agreement (including the provisions of this Agreement) by the Republic shall be in the English language or accompanied by a certified English translation but the English language version shall be the prevailing version in the event of inconsistency between the English language version and any other language version.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14. <u>Representation of Underwriters</u>. Any Representatives will act for the several Underwriters in connection with the financing described in the Terms Agreement, and any action under such Terms Agreement (including the provisions of this Agreement) taken by the Representatives jointly or by the Lead Underwriter will be binding upon all the Underwriters.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15. <u>Counterparts</u>. The Terms Agreement (including the provisions of this Agreement) may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16. <u>APPLICABLE LAW</u>. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

------

Annex I

Capitalized terms used in this Annex I and not defined herein shall have the meanings ascribed thereto in the Underwriting Agreement to which this Annex I is appended.

OPINION OF THE PROCURADOR(A) DE LA ADMINISTRACIÓN

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The Terms Agreement (including the provisions of the Underwriting Agreement) has been duly authorized, executed and delivered by the Republic and constitutes the valid and legally binding agreement of the Republic.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The Offered Securities have been duly authorized, issued, executed, and when authenticated and delivered against payment therefor, will constitute the valid and legally binding obligations of the Republic enforceable in accordance with their terms and entitled to the benefits of the Fiscal Agency Agreement subject, as to enforcement, to bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium and similar laws of general applicability relating to or affecting creditors' rights and to general equity principles.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The Fiscal Agency Agreement has been duly authorized, executed and delivered by the Republic and, assuming due authorization, execution and delivery thereof by the Fiscal Agent, constitutes the valid and legally binding obligation of the Republic enforceable in accordance with its terms, subject, as to enforcement, to bankruptcy, insolvency, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors' rights and to general equity principles.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Neither the execution, delivery or performance of the Terms Agreement (including the provisions of the Underwriting Agreement), the Fiscal Agency Agreement or the Offered Securities, nor compliance with the terms and provisions thereof, including performance of each of the obligations contained therein and required thereby (A) to the best of such counsel's knowledge after due inquiry, will conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, loan agreement or other agreement or instrument for borrowed money known to such counsel to which the Republic is a party, (B) will conflict with, violate or result in a breach of, the Constitution of the Republic as amended to the date hereof, or any statutes, laws, decrees or regulations of the Republic, (C) to the best of such counsel's knowledge after due inquiry, will conflict with or result in a breach of any of the terms, conditions or provisions of any treaty, convention or agreement to which the Republic is a party or constitute a default thereunder or (D) will result in the creation or imposition of any mortgage, lien, charge or encumbrance of any nature whatsoever upon any of the revenues or assets of the Republic under any such treaty, convention, agreement or instrument, which, in the case of Clause (A), (B), (C) or (D) could have a material adverse effect on the financial, economic or fiscal condition of the Republic or affect the validity or enforceability of the Offered Securities.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) The Registration Statement and the Prospectus and their filing with the Commission have been duly authorized by and on behalf of the Republic, and the Registration Statement has been duly executed by and on behalf of the Republic; the Ambassador of Panama to the United States has been duly appointed the Authorized Representative of the Republic in connection with the Registration Statement; the information in the Registration Statement and the Prospectus as amended or supplemented stated on the authority of public officials of the Republic has been stated in their official capacities thereunto duly authorized by the Republic.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) All Panamanian Governmental Authorizations of or with any Panamanian Government Agency required by the Republic for the execution and delivery of the Terms Agreement (including the provisions of the Underwriting Agreement) and the Fiscal Agency Agreement and for the execution, issuance, sale and delivery of the Offered Securities, and the consummation by the Republic of the transactions contemplated by the Terms Agreement (including the provisions of the Underwriting Agreement), the Fiscal Agency Agreement and the Offered Securities (which shall be specified in such opinion) have been obtained and are in full force and effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) Under the laws of the Republic, neither the Republic nor any of its property has any immunity from the jurisdiction of any Panamanian court or from the execution of any judgment in the Republic or from enforcement therein of any judgment by any court or other tribunal on the grounds of sovereignty or otherwise, except that the execution on, or attachment of, revenues, assets and property of the Republic located in the Republic through the courts of the Republic, both prior to and post-judgment, shall be subject to the provisions of Articles 1047, 1048, 1650 and 1939 of the Judicial Code of the Republic of Panama.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) (A) The agreement of the Republic and the parties thereto that the Terms Agreement (including the provisions of the Underwriting Agreement), the Fiscal Agency Agreement and the Offered Securities shall be governed by, and construed in accordance with, the laws of the State of New York, United States of America would be recognized and effective in the courts of the Republic in any action or proceeding involving the Republic arising out of or relating to the Terms Agreement (including the provisions of the Underwriting Agreement), the Fiscal Agency Agreement or the Offered Securities. (B) (i) The submission of the Republic pursuant to Section 12 of the Underwriting Agreement, Section 14 of the Fiscal Agency Agreement and Paragraph 13 of the Offered Securities to the non-exclusive jurisdiction of any New York State or Federal court sitting in The City of New York, New York and any court sitting in the Republic for the purposes set forth in such Sections and Paragraph and the appointment of the Authorized Agent (as defined in the Underwriting Agreement, in the Fiscal Agency Agreement and in the Offered Securities) as its authorized agent for the purposes described in Section 12 of the Underwriting Agreement, in Section 14 of the Fiscal Agency Agreement and in Paragraph 13 of the Offered Securities are each valid and legally binding on the Republic. (C) Service of process effected in the manner set forth in Section 12 of the Underwriting Agreement, in Section 14 of the Fiscal Agency Agreement and in Paragraph 13 of the Offered Securities will be effective, insofar as Panamanian law is concerned, to confer valid personal jurisdiction over the Republic to the extent of any action referred to therein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) To ensure the legality, validity, enforceability or admissibility in evidence of the Terms Agreement (including the provisions of the Underwriting Agreement), the Fiscal Agency Agreement or any other document or instrument related to the Offered Securities, it is not necessary that the Terms Agreement (including the provisions of the Underwriting Agreement), the Fiscal Agency Agreement, the Offered Securities or any other such document or instrument be filed, registered or recorded with, or executed or notarized before, any court or other authority in the Republic (other than the translation and publication thereof), or that any registration charge or stamp or similar tax be paid on or in respect of the Terms Agreement, the Fiscal Agency Agreement, the Offered Securities, or any other such document or instrument.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) There is no tax, levy, deduction, charge or withholding imposed by the Republic or any political subdivision thereof either (A) on or by virtue of the execution, delivery, performance, recognition or enforcement of this Terms Agreement, the Fiscal Agency Agreement or the Offered Securities or (B) on any payment to be made by the Republic thereunder or under the Offered Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi) The statements in the Prospectus Supplement under the caption "Taxation — Panamanian Taxation" fairly summarize the provisions of Panamanian tax law described therein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xii) Other than as set forth in the Prospectus, to the best of such counsel's knowledge after due inquiry, there are no legal or governmental proceedings or arbitrations pending to which the Republic is a party which, if determined adversely to the Republic, would, individually or in the aggregate, have a material adverse effect on the Republic's financial, economic or fiscal condition or its ability to perform its obligations under the Terms Agreement (including the provisions of the Underwriting Agreement), the Fiscal Agency Agreement or the Offered Securities; and, to the best of such counsel's knowledge after due inquiry, no such proceedings are threatened.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiii) The Terms Agreement (including the provisions of the Underwriting Agreement), the Fiscal Agency Agreement and the Offered Securities are in proper legal form under the laws of the Republic for the enforcement thereof against the Republic under the law of Panama.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiv) No stamp or other issuance or transfer taxes or duties and no capital gains, income, withholding, or other taxes are payable by you or on your behalf as Underwriters to the Republic or to any political subdivision or taxing authority thereof or therein by reason of your being Underwriters in connection with (A) the issuance, sale and delivery by the Republic to or for the respective accounts of the Underwriters of the Offered Securities issued and sold to the initial purchasers in the manner contemplated by the Terms Agreement.

In addition to the foregoing, such counsel will confirm that the Registration Statement and the Prospectus have been prepared by appropriate representatives of the Republic and its instrumentalities, including representatives of the Ministry of Planning and Economic Policy, and representatives of the Procuraduría de la Administración ("PDA") have participated in discussions regarding the Registration Statement and the Prospectus with such representatives, U.S. counsel for Panama, the representatives of the Underwriters and its U.S. counsel. PDA has been apprised of and has reviewed the disclosure requirements under applicable United States securities laws and regulations and has reviewed the Registration Statement and the Prospectus. Based on such discussions and

------

review, and without independent investigation or verification of the correctness or completeness of the information included in the Registration Statement and the Prospectus, such counsel will advise the Underwriters, on behalf of PDA, that, subject to the limitations described below, nothing has come to PDA's attention which has caused it to believe that, as of its effective date, the Registration Statement and the Prospectus and any further amendments or supplements thereto made by the Republic prior to the date of this opinion contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that, as of the date of the Terms Agreement, the Prospectus or any further amendment or supplement thereto contained an untrue statement of a material fact or omits to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading or that, as of the date of the opinion, the Registration Statement or the Prospectus or any further amendment or supplement made by the Republic prior to the date of the opinion contains an untrue statement of material fact or omits to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. Such counsel may state that the PDA is not passing upon and does not assume any responsibility for the accuracy, completeness or fairness of the statements contained in the Prospectus (except to the extent expressly set forth in clause (xi) above), that such counsel makes no representation that PDA has independently verified the accuracy, completeness or fairness of such statements (except as aforesaid) and that such counsel does not express any opinion or belief as to the financial or statistical data contained in the Registration Statement or the Prospectus.

------

Annex II

Capitalized terms used in this Annex II and not defined herein shall have the meanings ascribed thereto in the Underwriting Agreement to which this Annex II is appended.

OPINION OF U.S. COUNSEL TO THE REPUBLIC

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Assuming that the Fiscal Agency Agreement has been duly authorized, executed and delivered by the Republic and by the Fiscal Agent, the Fiscal Agency Agreement constitutes a valid and legally binding agreement of the Republic, enforceable in accordance with its terms, subject, as to enforcement, to bankruptcy, insolvency, reorganization, moratorium and similar laws of general applicability affecting creditors' rights and to general equity principles.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Assuming that the Offered Securities have been duly authorized, executed, issued and delivered under Panamanian law and authenticated by the Fiscal Agent, such Offered Securities constitute valid and legally binding obligations of the Republic entitled to the benefits provided by the Fiscal Agency Agreement and enforceable in accordance with their terms, subject, as to enforcement, to bankruptcy, insolvency, reorganization, moratorium and similar laws of general applicability affecting creditors' rights and to general equity principles.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) No consent, approval, authorization or order of, or qualification with, any United States Federal or New York State governmental agency or body is required for the issue and sale of the Offered Securities or the performance by the Republic of the transactions contemplated by the Terms Agreement (including the provisions of the Underwriting Agreement), the Fiscal Agency Agreement or the Offered Securities, except such as have been obtained under the Act and such consents, approvals, authorizations or qualifications as may be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Offered Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Under the laws of the State of New York, assuming the Republic has duly authorized, executed and delivered the Terms Agreement under Panamanian law, (A) the submission of the Republic pursuant to Section 12 of the Underwriting Agreement, Section 14 of the Fiscal Agency Agreement and Paragraph 13 of the Offered Securities to the

------

non-exclusive jurisdiction of any New York State or federal court sitting in The City of New York and any court sitting in Panama for the purposes set forth in such Paragraphs and Section and (B) the appointment of the Authorized Agent (as defined in the Underwriting Agreement) as its authorized agent for the purposes described in Section 12 of the Underwriting Agreement, Section 14 of the Fiscal Agency Agreement and Paragraph 13 of the Offered Securities are each valid and legally binding on the Republic; any service of process effected on such agent in the manner set forth in Section 12 of the Underwriting Agreement, Section 14 of the Fiscal Agency Agreement and Paragraph 13 of the Offered Securities will be effective to confer valid personal jurisdiction over the Republic to the extent of any action referred to therein, subject to the limitations of the Foreign Sovereign Immunities Act of 1976, as amended.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) The statements set forth in the Prospectus Supplement under the caption "Taxation—U.S. Taxation" insofar as such statements purport to describe the principal U.S. federal income tax consequences of a purchase of the Offered Securities, constitute fair summaries of such consequences.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) The Registration Statement is effective under the Act and, to the best of such counsel's knowledge, no stop order with respect thereto has been issued, or proceeding for that purpose instituted or threatened by the Commission.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) The statements set forth in the Prospectus under the caption "Description of the Debt Securities" and in the Prospectus Supplement under the caption "Description of the Offered Securities", insofar as they purport to constitute a summary of certain provisions of the Offered Securities and the Fiscal Agency Agreement, provide a fair summary of such provisions.

In addition, United States counsel to Panama shall have furnished to the Underwriters a letter confirming that as United States counsel to Panama, such counsel reviewed the Registration Statement and the Prospectus, as then amended or supplemented, participated in discussions with representatives of the Underwriters and those of the Republic and its Panamanian counsel, and advised the Republic as to the requirements of the Act and the applicable rules and regulations thereunder; confirming that on the basis of the information that such counsel gained in the course of the performance of such services, considered in the light of their understanding of the applicable law and the experience they have gained through their practice under the Act, in their opinion, the Registration Statement, and the Prospectus, as then amended or supplemented, as of the effective date of the Registration Statement, appeared on their face to be appropriately responsive in all material respects to the requirements of the Act and the applicable rules and regulations of the Commission thereunder; nothing that came to such counsel's attention in the course of such review has caused such counsel to believe that the Registration Statement, as then amended or supplemented, as of such effective date, contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary to make the

------

statements therein not misleading or that the Prospectus, as of its date, contained any untrue statement of a material fact or omitted to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; and nothing that has come to such counsel's attention in the course of the limited procedures described in such letter has caused them to believe that the Prospectus, as then amended or supplemented, as of the date and time of delivery of such letter, contained any untrue statement of a material fact or omitted to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. Such counsel may state that they do not assume any responsibility for the accuracy, completeness or fairness of the statements contained in the Registration Statement, or the Prospectus except to the extent of the opinion separately rendered by such counsel with respect to statements made under the captions "Description of the Debt Securities" in the Prospectus as then amended or supplemented and in the Prospectus Supplement under the captions "Description of the Offered Securities" and "Taxation—U.S. Taxation"; that such counsel do not express any opinion or belief as to the financial statements and related schedules or other financial or statistical data; that such counsel do not express an opinion or belief as to the laws of the Republic or as to information supplied by or on behalf of the Underwriters in writing expressly for use therein; and that their letter is furnished as United States counsel for Panama to you and is solely for the benefit of the Underwriters.

## Ex-99.O

**Exhibit O** 

**RECENT DEVELOPMENTS IN THE REGISTRANT AS OF MARCH 21, 2023** 

*The information included in this Exhibit O supplements the information about the Republic of Panama (the "Republic" or "Panama") contained in Panama's annual report for the year ended December 31, 2021, on Form 18-K filed with the Commission on September 30, 2022, as amended by Amendment No. 1 thereto filed on November 21, 2022, and as may be further amended from time to time. To the extent the information in this Exhibit O is inconsistent with the information contained in such annual report, the information in this Exhibit O replaces such information. Initially capitalized terms used in this section have the respective meanings assigned to those terms in such annual report.* 

**Republic of Panama** 

*Social and Economic Situation* 

On December 2, 2022, Archbishop José Domingo Ulloa, who led the first phase of the National Roundtable for Dialogue, asked the University of Panama to serve as mediator and to contact the parties who expressed interest in participating in the second phase of the National Roundtable for Dialogue.

On December 17, 2022, after several preliminary meetings with the representative sectors, the University of Panama's Inter-American School for Social Dialogue and Conflict Resolution (the "EI-DiSTReC") communicated that it would serve as the mediator for the second phase of the National Roundtable for Dialogue only after all parties reached an agreement on five parameters: (i) the location of the Roundtable meetings; (ii) logistics; (iii) confidentiality and communications with respect to the negotiations; (iv) the topics to be discussed; and (v) participation on an equal footing.

On February 11, 2023, the Minister of Public Works, the Minister of Government and the director of the Agricultural Marketing Institute met with indigenous groups from Viguí and San Félix in the province of Chiriquí. The indigenous leaders expressed their concerns regarding the Government's compliance with agreements reached at the National Roundtable for Dialogue regarding road repair in the community and the price of the basic consumer basket and did not rule out closing off major roads in the event of noncompliance. On February 13, 2023, a group of indigenous people temporarily closed the Inter-American Highway in Chiriquí, requesting the repair of roads in their community, protesting the high cost of food and demanding Government compliance with the agreements made at the National Roundtable for Dialogue.

On February 20, 2023, the United Nations announced that it would participate in Panama's National Roundtable for Dialogue and provide technical support. The UN proposed sending an exploratory mission to learn more about the participants and mechanisms in connection with the National Roundtable for Dialogue.

As of February 23, 2023, the parties have not set a date for the commencement of the second phase of National Roundtable for Dialogue.

**Recent Government Actions** 

On November 17, 2022, Law No. 337 of 2022 was published, which allows the General Directorate of Revenue (DGI) to enter into special payment agreements with taxpayers who owe back taxes, as a temporary measure to stimulate collection of taxes. Law No. 337 is expected to promote the generation of current income, mainly tax, for the benefit of the State, translating the receipts into greater investments and opportunities for social development.

On November 24, 2022, the Judicial Branch announced that Guillermo Puga, a member of the Board of Directors of the Social Security Fund, and other union leaders were sentenced to five years in prison for the crime of embezzlement from the Ministry of Labor and Labor Development ("Mitradel"). The investigation into the accused began after the former Minister of Labor filed a complaint with the Public Ministry alleging that the Institute of Labor Studies, a unit within Mitradel, handed over large sums of money to labor unions without the unions having presented the required reports on the use of the funds. During the investigation, inconsistencies were found between permitted uses and expenses of over U.S.$261,000.

------

On December 15, 2022, President Cortizo, together with the Cabinet Council, instructed the Minister of Commerce and Industry, the Minister of Environment and the Minister of Labor and Labor Development to adopt administrative measures in order to comply with the 2017 judgment of the Supreme Court of Justice that declared the contract between the Panamanian State and the company Minera Panamá S.A. (formerly Minera Petaquilla, S.A.) unconstitutional. President Cortizo stated that the decision came after Minera Panamá failed to fulfill its January 2022 commitment to work towards a reasonable and satisfactory concession contract that establishes fair benefits for both parties.

On December 24, 2022, the Ministry of Commerce and Industry announced that First Quantum Minerals and Minera Panamá S.A. took steps to initiate two arbitrations against Panama: (1) a commercial arbitration against Panama under the 1997 concession contract, which was declared unconstitutional by the Supreme Court of Justice, and (2) an investment arbitration under the Canada-Panama Free Trade Agreement (FTA).

On December 30, 2022, the Government extended the Vale Digital economic support program, which provides transfers of U.S.$120 per month to people affected by the COVID-19 pandemic, until February 2023. On February 28, 2023, the Cabinet Council authorized another extension of the Vale Digital through April 2023.

On January 12, 2023, the Government extended the fuel subsidy until February 15, 2023, maintaining the price per gallon at U.S.$3.25 for 91 and 95 octane gasoline, as well as diesel. The Government later extended the fuel subsidy again until April 1, 2023.

Through Executive Decree No. 1 of January 18, 2023, the Government extended the price controls on 18 food products from the basic consumer basket for an additional six months.

On January 26, 2023, the Panama Maritime Authority issued Resolution No. 007-2023 requiring Minera Panamá S.A. to suspend copper concentrate loading operations at the port of Punta Rincon until the company demonstrates the certification process of the calibration of the scales by an accredited company.

On February 14, 2023, the European Union announced that it would keep Panama on its list of tax havens.

On February 14, 2023, through Executive Decree No. 3, the Government extended the 30% discount on the price of medicines for an additional six months.

On February 23, 2023, First Quantum Minerals Ltd. announced that its subsidiary, Minera Panamá S.A., was suspending ore processing operations at the Cobre Panama mine as a the result of the refusal by the Panama Maritime Authority to allow copper concentrate loading operations at the mine's Punta Rincón port.

On February 24, 2023, the Financial Action Task Force (the "FATF") upgraded Panama's compliance rating, noting the completion of 13 of the 15 action items that were established in Panama's June 2019 FATF Action Plan to improve its framework against money laundering and terrorism financing. The FATF urged Panama to complete its Action Plan by June 2023.

On March 8, 2023, the Government of Panama and Minera Panamá S.A. announced that they had reached agreement on the final text of the concession contract that will govern the long-term operation of the Cobre Panama project. The proposed new concession contract will have an initial 20-year term, with a 20-year extension option, and meets the Government's objectives with respect to equitable sharing of royalties and taxes for Panama's natural resources, with expected minimum revenues for the Government of U.S.$375 million each year (approximately 10 times more than the Government received under the 1997 concession contract). The proposed concession contract is subject to a 30-day public consultation process and approvals by the Panamanian Cabinet, the Comptroller General and the National Assembly. First Quantum Minerals temporarily suspended the two arbitration suits against Panama with the intention of withdrawing them completely once the new contract is signed.

------

On March 8, 2023, President Cortizo signed Law No. 375 of 2023, creating the Ministry for Women. The Ministry for Women will develop and execute comprehensive public policies in favor of women in order to promote equal opportunities throughout Panama.

**Political Developments** 

On November 22, 2022, President Cortizo appointed Vladimir A. Franco Sousa and Yill del Carmen Otero as new Vice Ministers of Foreign Affairs.

On November 24, 2022, a criminal trial court in the First Judicial Circuit of the province of Panama opened a criminal case against three people, including the former Minister of Labor, Alma Cortés, for the alleged crime of unjustified enrichment while working at Mitradel. The criminal case is based on an official investigation that began in 2016 in connection with audit reports presented by the Comptroller General.

On December 19, 2022, former Minister of Labor Alma Cortés was sentenced to 32 months in prison after the Superior Court of Appeals overturned the trial court's acquittal in a case involving alleged anomalies in the disbursement of money for travel expenses.

On January 25, 2023, the U.S. delivered Luis Enrique Martinelli and Ricardo Alberto Martinelli Linares into the custody of Panamanian authorities after the men served a 36-month sentence in the U.S. for bribery and money laundering.

On January 25, 2023, U.S. Secretary of State Antony Blinken announced that the U.S. will bar former Panamanian President Ricardo Martinelli and his immediate family from entering the country due to his involvement in significant corruption and bribery schemes.

On February 1, 2023, Vice President José Gabriel Carrizo resigned from his position as Minister of the Presidency to begin his presidential campaign for the 2024 general elections. Vice President Carrizo officially launched his presidential candidacy on February 5, 2023, seeking to be the Democratic Revolutionary Party's primary candidate.

On February 7, 2023, President Cortizo appointed José Simpson Polo as the new Minister of the Presidency, replacing José Gabriel Carrizo.

On February 8, 2023, the vice mayor of the district of Panama, Judy Meana, resigned. In a letter addressed to the mayor, José Luis Fábrega, Ms. Meana expressed her deep disagreement with his decision-making, which she deemed arbitrary and which she claimed did not benefit the district's residents.

On February 15, 2023, the Office of the Attorney General confirmed the six-year sentence imposed on the former Minister of Social Development, Guillermo Ferrufino, and his wife, Milena Vallarino, for the crime of unjustified enrichment. Their conviction was based on crimes committed between 2009 and 2014, during the government of former President Ricardo Martinelli, when Mr. Ferrufino served as minister.

On February 27, 2023, the Vice Minister of Indigenous Affairs, Ausencio Palacio, resigned. President Cortizo appointed Ismael A. Jaén as the new Vice Minister of Indigenous Affairs. Vice Minister Jaén has Master's Degrees in School Management and Supervision and in Mathematics Education.

On February 28, 2023, the director of the Institute for the Training and Use of Human Resources ("Ifarhu"), Bernardo Meneses, and the director of the Panamanian Sports Institute ("Pandeportes"), Héctor Brands, resigned from their positions to pursue their respective political aspirations. President Cortizo promptly named the replacements: Ileana Molo Alvarado as the director of Ifahru, and Luis Denis Arce as the director of Pandeportes.

------

On March 10, 2023, President Cortizo appointed Juana Herrera as the Minister of the newly-created Ministry for Women. The Presidency reported that Ms. Herrera has extensive training in medicine, having recently served as director of the National Institute of Mental Health and head of the Mental Health section of the Ministry of Health.

**The Panamanian Economy** 

*Economic Performance* 

In 2022, estimated GDP growth was 10.8%, compared to 15.8% GDP growth 2021, mainly due to continued recovery of all economic activities due to the control of the COVID-19 pandemic, which allowed the full opening of the economy. Inflation was 2.9% in 2022 compared to 2021.

The transportation, storage and mail sector grew by 13.7% in 2022 compared to 2021, representing 11.4% of GDP in 2022. Growth in the transportation, storage and mail sector was primarily due to increased operations in the Panama Canal as well as increased activity in ports and in air and ground transportation. Mining activities increased by 6.3% in 2022 compared to 2021, representing 4.0% of GDP in 2022. Growth in mining activities was primarily due to the extraction of basic material such as stone, sand and clay. The information and communications sector grew by 2.8% in 2022 compared to 2021, representing 2.4% of GDP in 2022. Growth in the information and communications sector was primarily due to an increase in demand for mobile phone and internet services.

The construction sector grew by 18.5% in 2022 compared to 2021, representing 14.1% of GDP in 2022. Growth in the construction sector was primarily due to public investment in infrastructure and construction of residential projects. The financial and insurance sector grew by 5.5% in 2022 compared to 2021, representing 6.3% of GDP in 2022. Growth in the financial intermediation sector was attributable mainly to higher performance of the banking sector.

The manufacturing sector grew by 5.1% in 2022 compared to 2021, representing 4.8% of GDP in 2022. Growth in the manufacturing sector was primarily due to an increase in the production of meat and meat products. The agricultural and fisheries sector grew by 5.2% in 2022 compared to 2021, representing 2.6% of GDP in 2022. Growth in the agricultural and fisheries sector was primarily due to an increase in the production of rice. The commerce, hotels and restaurants sector grew by 17.7% in 2022 compared to 2021, representing 21.6% of GDP in 2022. The growth in the commerce, hotels and restaurants sector was mainly due to an increase in the sales volume of wholesale food products, beverages, textiles, clothing construction materials and the sale of fuel.

The Central Government's current savings in 2022 registered a surplus of U.S.$620.4 million (0.8% of nominal GDP) compared to a deficit of U.S.$1,124.4 million in 2021 (1.7% of nominal GDP). The Government's overall deficit decreased to U.S.$3,108.4 million in 2022 (4.1% of nominal GDP) from U.S.$4,495.5 million in 2021 (6.7% of nominal GDP). In 2022, Panama's non-financial public sector balance registered a deficit of U.S.$3,005.5 million (3.9% of nominal GDP), a decrease from a deficit of U.S.$4,345.2 million (6.5% of nominal GDP) in 2021.

As of December 31, 2022, the total estimated amount of payments scheduled under the Government's outstanding turnkey and deferred payment contracts from 2023 to 2026 was approximately U.S.$1,206.3 million, up from U.S.$846.0 million as of December 31, 2021.

------

The following table sets forth Panama's principal price indicators for each of the years 2018 through 2022:

**<u>TABLE NO. 2</u>**

**Inflation** 

**(percentage change from previous period) <sup>(1)</sup>** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2018** | **2019** | **2020** | **2021** | **2022** |
|  Annual Percentage Change: |  |  |  |  |  |
|  Consumer Price Index | 0.8% | (0.4)% | (1.6)% | 1.6% | 2.9% |

---

(1) The CPI inflation base year is 2013

Note: Totals may differ due to rounding.

*Source:* Office of the Comptroller General.

The following tables set forth Panama's GDP, including sectoral origin (in dollars and as a percentage of GDP) and percentage change from 2018 to 2022:

**<u>TABLE NO. 3</u>**

**Gross Domestic Product** 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2018 <sup>(R)</sup>** |  | **2019 <sup>(R)</sup>** | **2020 <sup>(R)</sup>** | **2021 <sup>(R)</sup>** | **2022 <sup>(E)</sup>** |
|  Gross Domestic Product in chained volume measure (millions of dollars)<sup>(1)</sup> | $67294.2 |  | $69502.7 | $57222.7 | $66284.4 | $73449.3 |
|  % Change over Previous Year | 66.9 | % <sup>†</sup> | 3.3% | (17.7)% | 15.8% | 10.8% |
|  Gross Domestic Product in nominal prices (millions of dollars) | $62294.2 |  | $69721.8 | $57086.8 | $67406.7 | $76522.5 |
|  % Change over Previous Year | 4.4 | % | 3.6% | (18.1)% | 18.1% | 13.5% |

---

Note: Totals may differ due to rounding.

(R) Revised figures.

(E) Estimated figures.

(1) Figures are based on 2018 constant dollars.

† The percentage change in GDP between 2017 and 2018 is due in part to the Office of the Comptroller
General's rebasing of the System of National Accounts to 2018, which resulted in a higher revised GDP figure for 2018. See "Presentation of Economic and Other Information".

*Source:* Office of the Comptroller General.

------

**<u>TABLE NO. 4</u>**

**Sectoral Origin of Gross Domestic Product** 

**(in millions of dollars)<sup>(1)</sup>** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2018 <sup>(R)</sup>** | **2019 <sup>(R)</sup>** | **2020 <sup>(R)</sup>** | **2021 <sup>(R)</sup>** | **2022 <sup>(E)</sup>** |
|  Primary Activities: |  |  |  |  |  |
|  Agriculture and Fisheries | $1595.2 | $1684.6 | $1716.2 | $1797.3 | $1890.5 |
|  Mining | 848.2 | 1039.3 | 1336.9 | 2734.4 | 2905.7 |
|  **Total** | $**2443.4** | $**2723.9** | $**3053.1** | $**4531.7** | $**4796.2** |
|  Industrial Activities: |  |  |  |  |  |
|  Manufacturing | $3851.6 | $3797.7 | $3011.8 | $3353.7 | $3525.7 |
|  Construction | 12915.4 | 13010.0 | 6793.4 | 8752.6 | 10373.2 |
|  **Total** | $**16767.0** | $**16807.7** | $**9805.2** | $**12106.3** | $**13898.9** |
|  Services: |  |  |  |  |  |
|  Public utilities | $1380.5 | $1407.8 | $1431.3 | $1529.6 | $1575.9 |
|  Commerce, restaurants and hotels | 14346.5 | 14589.5 | 11299.5 | 13493.2 | 15886.2 |
|  Information and communications | 1597.9 | $1602.5 | $1622.6 | $1699.5 | $1747.9 |
|  Transportation, storage and mail | 6880.9 | 7454.4 | 6292.4 | 7357.2 | 8364.8 |
|  Financial and insurance | 4141.7 | 4318.6 | 4365.8 | 4415.5 | 4657.0 |
|  Real estate | 5926.2 | 6245.9 | 6220.9 | 6474.8 | 6795.8 |
|  Public administration | 2777.7 | 2951.9 | 3404.4 | 3668.8 | 3684.2 |
|  Other services | 8777.6 | 9185.4 | 8260.6 | 9117.5 | 9891.2 |
|  **Total** | $**45829.2** | $**47755.9** | $**42897.4** | $**47756.2** | $**52603.0** |
|  Plus Import Taxes<sup>(2)</sup> | 2254.6 | 2215.1 | 1526.8 | 1857.3 | 2123.9 |
|  Less Imputed Banking Services |  |  |  |  |  |
|  **Gross Domestic Product in chained volume measure<sup>(3)</sup>** | $**67294.2** | $**69502.7** | $**57222.7** | $**66284.4** | $**73449.3** |

---

Note: Totals may differ due to rounding.

(R) Revised figures.

(E) Estimated figures.

(1) Figures are based on 2018 constant dollars and include the Central Government, CSS and consolidated agencies.
Figures do not include the PCA or CFZ.

(2) Including value-added tax.

(3) The discrepancy between each total and the sum of its components is due to statistical differences originating
from utilization of moving base price structures, in accordance with the suggested methodology from the SNA 1993.

*Source:* Office of the Comptroller General.

------

**<u>TABLE NO. 5</u>**

**Percentage Change from Prior Year for** 

**Sectoral Origin of Gross Domestic Product (percentage change)<sup>(1)</sup>** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2018<sup>(R)</sup>** | **2019 <sup>(R)</sup>** | **2020 <sup>(P)</sup>** | **2021 <sup>(R)</sup>** | **2022 <sup>(E)</sup>** |
|  Primary Activities: |  |  |  |  |  |
|  Agriculture and Fisheries | 1.9% | 5.6% | 1.9% | 4.7% | 5.2% |
|  Mining | 2.8% | 22.5% | 28.6% | 104.5% | 6.3% |
|  Total | 2.9% | 11.5% | 12.1% | 48.4% | 5.8% |
|  Industrial Activities: |  |  |  |  |  |
|  Manufacturing | 1.3% | (1.4)% | (20.7)% | 11.4% | 5.1% |
|  Construction | 3.2% | 0.7% | (47.8)% | 28.8% | 18.5% |
|  Total | 2.7% | 0.2% | (41.7)% | 23.5% | 14.8% |
|  Services:<sup>(2)</sup> |  |  |  |  |  |
|  Public utilities | 7.3% | 2.0% | 1.7% | 6.9% | 3.0% |
|  Commerce, restaurants and hotels | 3.1% | 1.7% | (22.6)% | 19.4% | 17.7% |
|  Information and communications | n/a | 0.3% | 1.3% | 4.7% | 2.8% |
|  Transportation, storage and mail | n/a | 8.3% | (15.6)% | 16.9% | 13.7% |
|  Financial and insurance | 3.2% | 4.3% | 1.1% | 1.1% | 5.5% |
|  Real estate | 2.7% | 5.4% | (0.4)% | 4.1% | 5.0% |
|  Public administration | 7.9% | 6.3% | 15.3% | 7.8% | 0.4% |
|  Other services | 3.7% | 4.6% | (10.1)% | 10.4% | 8.5% |
|  Total | 4.3% | 4.2% | (10.2)% | 11.3% | 10.1% |
|  Plus Import Taxes<sup>(3)</sup> | 0.7% | (1.8)% | (31.1)% | 21.6% | 14.4% |
|  Less Imputed Banking Services |  |  |  |  |  |
|  Gross Domestic Product in chained volume measure | 3.7% | 3.3% | (17.7)% | 15.8% | 10.8% |

---

Note: Totals may differ due to rounding.

(R) Revised figures.

(P) Preliminary figures.

(E) Estimated figures.

(1) Figures are based on 2018 constant dollars.

(2) Panama Canal and CFZ figures are not based on 2018 constant dollars and are therefore not included in this
table.

(3) Including value-added tax.

*Source:* Office of the Comptroller General

------

**<u>TABLE NO. 6</u>**

**Sectoral Origin of Gross Domestic Product** 

**(as percentage of GDP)<sup>(1)</sup>** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2018 <sup>(R)</sup>** | **2019 <sup>(R)</sup>** | **2020 <sup>(P)</sup>** | **2021 <sup>(E)</sup>** | **2022 <sup>(E)</sup>** |
|  Primary Activities: |  |  |  |  |  |
|  Agriculture and fisheries | 2.4% | 2.4% | 3.0% | 2.7% | 2.6% |
|  Mining | 1.3% | 1.5% | 2.3% | 4.1% | 4.0% |
|  Total | 3.6% | 3.9% | 5.3% | 6.8% | 6.5% |
|  Industrial Activities: |  |  |  |  |  |
|  Manufacturing | 5.7% | 5.5% | 5.3% | 5.1% | 4.8% |
|  Construction | 19.2% | 18.7% | 11.9% | 13.2% | 14.1% |
|  Total | 24.9% | 24.2% | 17.1% | 18.3% | 18.9% |
|  Services <sup>(2)</sup> |  |  |  |  |  |
|  Public utilities | 2.1% | 2.0% | 2.5% | 2.3% | 2.1% |
|  Commerce, restaurants and hotels | 21.3% | 21.0% | 19.7% | 20.4% | 21.6% |
|  Information and communications | 2.4% | 2.3% | 2.8% | 2.6% | 2.4% |
|  Transportation, storage and mail | 10.2% | 10.7% | 11.0% | 11.1% | 11.4% |
|  Financial and insurance | 6.2% | 6.2% | 7.6% | 6.7% | 6.3% |
|  Real estate | 8.8% | 9.0% | 10.9% | 9.8% | 9.3% |
|  Public administration | 4.1% | 4.2% | 5.9% | 5.5% | 5.0% |
|  Other services | 13.0% | 13.2% | 14.4% | 13.8% | 13.5% |
|  Total | 68.1% | 68.7% | 75.0% | 72.0% | 71.6% |
|  Plus Import Taxes<sup>(3)</sup> | 3.4% | 3.2% | 2.7% | 2.8% | 2.9% |
|  Less Imputed Banking Services | —% | —% | —% | —% | —% |
|  Gross Domestic Product in chained volume measure<sup>(4)</sup> | 100.0% | 100.0% | 100.0% | 100.0% | 100.0% |

---

Note: Totals may differ due to rounding.

(R) Revised figures.

(P) Preliminary figures.

(E) Estimated figures.

(1) Figures are based on 2018 constant dollars.

(2) Including value-added tax.

(3) Panama Canal and CFZ figures are not based on 2018 constant dollars, thus are not included in this table.

(4) The discrepancy between each total and the sum of its components is due to statistical differences originating
from utilization of moving base price structures, in accordance with the suggested methodology from the SNA 1993.

*Source:* Office of the Comptroller General.

**Structure of the Panamanian Economy** 

*Principal Sectors of the Economy* 

**Service Sector**. The Panamanian economy is based primarily on the service sector, which represented an estimated 71.6% of GDP in 2022. Services include real estate; transportation, storage and mail; information and communication; commerce, restaurants and hotels; financial intermediation and insurance; public administration; the Panama Canal; the CFZ; and public utilities. While the commerce sector, transportation sector and real estate sector represent significant percentages of GDP (estimated to be 21.6%, 13.8% and 9.3%, respectively, of GDP in 2022), the Panamanian economy is distinguished by the economic benefits generated by the Panama Canal and the CFZ.

------

**Commerce**. Commerce—which includes wholesale and retail activities as well as restaurants and hotels—is the largest component of the service sector and represented an estimated 21.6% of GDP in 2022. In 2022, commerce activities increased 17.7% compared to 2021, mainly due to an increase in the sales volume of wholesale food products, beverages, textiles, clothing construction materials and the sale of fuel. In 2022, the restaurants and hotels sector increased 36.2% compared to 2021.

**Transportation, Storage and Mail**. The transportation, storage and mail sector, which includes ports, airports and railways and is the second largest component of the service sector, has been an important component of the Panamanian economy in recent years. It represented an estimated 13.8% of real GDP in chained volume measure in 2022.

**Real Estate**. The third largest component of the service sector is real estate, which consists of rental income and the imputed rental value of real estate that is occupied but not rented. Real estate represented an estimated 9.3% of GDP in chained volume measure in 2022.

**Financial Services and Insurance**. The financial services and insurance sector represented an estimated 6.3% of GDP in chained volume measure in 2022. An important component of the sector's contribution to GDP is attributable to the banking sector, which, as of December 31, 2022, consisted of two state-owned banks (*Banco Nacional de Panama* ("BNP") and *Caja de Ahorros*) and 64 private banks. The banking sector includes general license banks, international license banks, and foreign banks with representative offices. As of December 31, 2022, banking sector assets and deposits totaled approximately U.S.$140.0 billion and U.S.$98.4 billion, respectively.

**Panama Canal**. In the Panama Canal Authority's 2022 fiscal year ended September 30, 2022, canal transits increased to 14,239 transits from 13,342 transits during the 2021 fiscal year, while cargo tonnage increased to 291.8 million long tons during the 2022 fiscal year from 287.5 million long tons during the 2021 fiscal year. According to the Panama Canal Authority ("PCA"), toll revenues for fiscal year 2022 reached U.S.$3,027.9 million, an increase of 2.0% compared to U.S.$2,968.2 million in fiscal year 2021, and representing 4.0% of Panama's estimated nominal GDP for 2022.

**Industrial Sector***.* After the service sector, the next largest segment of the economy consists of the industrial activities of manufacturing and construction, collectively representing an estimated 18.9% of GDP in chained volume measure in 2022.

Manufacturing represented an estimated 4.8% of GDP in chained volume measure in 2022. Manufacturing is principally geared to the production of processed foods and beverages and, to a lesser extent, clothing, chemical products and construction materials for the domestic market.

Construction activity represented an estimated 14.1% of GDP in 2022 and increased by 18.5% compared to 2021, mainly due to public investment in infrastructure works and the construction of residential and non-residential works.

**Agriculture, Fisheries and Mining Sector**. The agriculture, fisheries and mining sector accounted for an estimated 6.5% of GDP in 2022. Principal agricultural products include bananas, fish, shrimp, sugar, coffee, meat, dairy products, tropical fruits, rice, corn and beans. The value of agricultural and fisheries production in 2022 is estimated to have increased by 5.2% compared to 2021, mainly due to an increase in the planting and harvesting of rice. The value of the mining sector in 2022 is estimated to have increased by 6.3% compared to 2021, mainly due to an increase in the extraction of basic materials, such as rock, sand and clay, which are inputs for the construction sector.

*Role of the Government in the Economy* 

General Government current expenditures (including the Central Government, *Caja de Seguro Social* and consolidated agencies, but excluding state-owned institutions and interest payments) totaled U.S.$10.9 billion in 2022.

------

The following table sets forth summary financial information on principal public sector businesses:

**Selected State-Owned Enterprises <sup>(1)</sup>** 

**2022 Financial Statistics** 

**(In millions of dollars)** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Total<br>Assets** | **Capital<br>and<br>Reserves** | **Gross<br>Revenues** | **Net<br>Income** | **Dividends<br>Paid to the<br>Government** |
|  Banco Nacional de Panamá ("BNP") (banking)<sup>(3)</sup> | $14603.9 | 1141.5 | 470.0 | 195.1 | 94.6 |
|  Empresa Nacional de Autopista ("ENA") (highway)<sup>(2)</sup> | $988.1 | 271.4 | 105.9 | 15.9 | 0.0 |
|  Empresa de Transmisión Eléctrica ("ETESA") (electricity <br>transmission)<sup>(3)</sup> | $1245.6 | 378.7 | 134.1 | 23.6 | 0.0 |
|  Metro de Panama, S.A. (railway)<sup>(3)</sup> | $5288.3 | 3964.3 | 44.8 | (168.4) | 0.0 |
|  Aeropuerto Internacional de Tocumen ("AITSA") (airport)<sup>(3)</sup> | $2309.7 | 395.2 | 242.2 | 4.3 | 0.0 |
|  Caja de Ahorros (banking)<sup>(3)</sup> | $6118.0 | 334.5 | 268.7 | 17.3 | 8.2 |

---

Note: Totals may differ due to rounding.

(1) All enterprises are 100% owned by the National Government.

(2) As of and for the nine-month period ended September 30, 2022.

(3) As of and for the year ended December 31, 2022.

*Sources*: BNP, ENA, ETESA, AITSA and Caja de Ahorros.

In June 2012, the Government created the *Fondo de Ahorro de Panamá* ("FAP") pursuant to Law No. 38 of 2012. The FAP's fourth quarter report shows total assets of the fund as U.S.$1.5 billion and U.S.$1.5 billion as of December 31, 2022 and December 31, 2021, respectively.

*Electric Power* 

Pursuant to Panamanian law, the transmission company, *Empresa de Transmisión Eléctrica, S.A.* ("ETESA"), remains 100% state-owned. In 2022, the Government received U.S.$72.3 million of dividends from its shares in electricity companies. In 2022, AES Panama, S.A. paid U.S.$18.0 million in dividends, Enel Fortuna paid U.S.$37.9 million in dividends, ESEPSA paid U.S.$1.9 million in dividends and Elektra Noreste, S.A. paid U.S.$14.4 million in dividends. ETESA, Bahia Las Minas Corp, EDEMET and EDECHI did not pay dividends in 2022.

ETESA is authorized by the *Autoridad Nacional de los Servicios Publicos* ("ASEP") to provide high tension electric energy transmission service to the general public under a concession contract that is valid until 2025 and that can be extended by ETESA. ETESA offers use of the transmission network with open access and regulated fees. ETESA's electric transmission system consists of transmission lines of 230 kV and 115 kV. As of June 2022, the total length of the 230 kV lines was 2,745.1 km in double circuit lines and 93.9 km in simple circuit lines, while the total length of the 115 kV lines was 272.3 km in double circuit lines and 37.8 km in simple circuit lines.

Panama currently has high electricity rates (an estimated average of 22.13 cents per kilowatt hour for the second half of 2022), and demand for electricity in the first nine months of 2022 increased at an estimated average rate of 4.3% compared with the same period of 2021. As of June 30, 2022, Panama had an installed generating base of 4,001.9 megawatts ("MW"), of which 1,810.3 MW (45.3%) were hydroelectric, 1,419.6 MW (35.5%) were thermoelectric, 435.1 MW (10.8%) were photovoltaic power and 336.0 MW (8.4%) were wind power. During the six-month period ended June 30, 2022, total energy generation in Panama amounted to 5,615 GWh (an increase of 0.4% compared to the same period of 2021), of which 55.4% was hydroelectric, 30.6% was thermoelectric and 14.0% was from renewable sources.

------

*Telecommunications* 

In its fiscal year ended December 31, 2022, Cable & Wireless (Panamá) S.A. experienced a 13.0% increase in revenue compared to the same period in 2021, mainly to the inclusion of América Móvil's operations in Panama during the last quarter of 2022. However, Cable & Wireless (Panamá) S.A. did not pay dividends to the Central Government for the company's fiscal year ended December 31, 2022.

As of December 31, 2022, the telecommunications market comprised approximately 244 operating companies and 732 companies authorized to operate telecommunication concessions. As of December 31, 2022, there were approximately 811,488 operating fixed telephone lines in the country with an estimated line penetration rate of 18.5 fixed lines per 100 inhabitants. As of December 31, 2022, there were approximately 6.9 million active cellular telephone lines.

*Water* 

The national water and sewage utility is the *Instituto de Acueductos y Alcantarillados Nacionales* ("IDAAN"), which serves approximately 92.0% of the population for which it is responsible (which constitutes 86.0% of the total population) through its 54 water purification plants, two filtration galleries, 194 pumping stations, and 609 underground wells. Inefficiency in IDAAN's operations and management, combined with leakage, has led to an estimated unaccounted for water rate of 40.0%. Unlike INTEL, S.A. (telecommunications) and *Instituto de Recursos Hidráulicos y de Electrificación* (electricity generation, transmission and distribution), which had generally paid dividends to the Government on an annual basis prior to privatization and required no Government funding, IDAAN has required periodic transfer payments from the Government to meet its operating and capital expenses.

*Air Transportation* 

In 2022, AITSA handled approximately 15.8 million passengers, an increase of 72.2% compared to 2021.

*Ports* 

In 2022, the Manzanillo International Terminal ("MIT") handled approximately 2.7 million TEUs of cargo and containers, compared to approximately 2.8 million TEUs in 2021. In 2022, the Colón Container Terminal handled approximately 1.4 million TEUs of cargo and containers, compared to approximately 1.1 million TEUs in 2021. In 2022, the container terminal at Port of Balboa handled approximately 2.2 million TEUs of cargo and containers, compared to approximately 2.3 million TEUs in 2021. In 2022, the container terminal at the Port of Cristobal handled approximately 913,911 TEUs of cargo and containers, compared to approximately 1.0 million TEUs in 2022.

*Banking* 

Collectively, BNP and *Caja de Ahorros* had approximately 18.8% of deposits and 16.1% of assets in the national banking system as of September 30, 2022. See "Financial System—Public Sector Banking Institutions" for more information on BNP and *Caja de Ahorros*. As of March 16, 2023, the Government had not announced any plans to privatize these financial institutions.

**Panama Canal** 

The Panama Canal plays a significant role in the Panamanian economy. In the PCA's 2022 fiscal year ended September 30, 2022, Canal transits increased to 14,239 from 13,342 in fiscal year 2021, while cargo tonnage in fiscal year 2022 increased to 291.8 million long tons from 287.5 million long tons in fiscal year 2021. According to the PCA, toll revenues for fiscal year 2022 reached U.S. $3,028.0 million, an increase of 2.0% compared to U.S. $2,968.0 million in fiscal year 2021.

------

On average, from the Canal's fiscal year 2018 to the fiscal year 2022, transits through the Canal increased by 1.1% per annum and cargo tonnage increased by 4.0% per annum. Factors such as the development of alternative land routes and the increasing size of vessels that can transit through the Canal have contributed to the decrease between 2018 and 2022 in the number of vessels required to transport cargo. On average, from fiscal year 2018 to fiscal year 2022, toll revenues increased by 6.3% per annum, primarily due to an increase in toll rates.

As of September 30, 2022, the Canal's total work force (which includes temporary and permanent personnel) was 8,727. Of the total 2022 work force, 7,728 (89%) were men and 999 (11%) were women.

The following table sets forth the Canal's statistical and financial information for fiscal years 2018 through 2022 (each ended on September 30):

**<u>TABLE NO. 8</u>**

**Panama Canal Principal Statistics** 

---

| | | | |
|:---|:---|:---|:---|
| **Fiscal Year** | **Number<br>of<br>Transits** | **Tolls<br>(millions of<br>U.S. dollars)** | **Long Tons<br>of Cargo<br>(millions)** |
| 2018 | 13795 | $2485.0 | $255.0 |
| 2019 | 13785 | $2593.0 | $253.0 |
| 2020 | 13369 | $2663.0 | $255.7 |
| 2021 | 13342 | $2968.0 | $287.5 |
| 2022 | 14239 | $3028.0 | $291.8 |

---

*Source:* Panama Canal Authority.

In fiscal year 2022, the PCA had a surplus of approximately U.S. $2,412.0 million, an increase of 12.9% compared to U.S. $2,136.0 million in 2021.

In 2022, the PCA transferred U.S.$2,494.4 million to the Central Government in dividends, an increase of 19.9% compared to U.S.$2,080.6 million in dividends that the PCA paid to the Central Government in fiscal year 2021. Of the total dividends paid to the Central Government for the 2022 fiscal year, the PCA paid to the Central Government U.S.$600.4 million from tolls and services, an increase of 1.3% compared to U.S.$592.8 million for the 2021 fiscal year.

In fiscal year 2022, precipitation levels around the Panama Canal were 8.5% above the historical yearly average. Due to the high precipitation levels and efficient water management in the Gatun and Alhajuela reservoirs, during 88% of the days in fiscal year 2022, the Canal had a 50-foot draft, the highest permitted in the neopanamax locks, which allowed vessels to transit with greater cargo volumes, maximizing the utilization of their fleet and positively impacting Canal revenues.

On January 1, 2023, the new toll system for transiting the Panama Canal went into effect. Approximately 430 different toll rates were consolidated into 60 toll rates, each at higher prices.

------

On January 16, 2023, the Panama Canal celebrated 21 years of reforestation efforts through the Panama Canal Economic Incentives Program, during which five million trees have been planted in the Canal Watershed with the purpose of protecting the environment and water resources. This figure has great significance and symbolism because it represents one tree for each Panamanian. The Program has allowed the reforestation of 10,846 hectares, of which 3,650 correspond to agroforestry (coffee, cocoa and fruit trees) and 4,776 correspond to silvopasture (on cattle farms). The remaining 2,420 hectares have been dedicated to conservation and commercial reforestation with the aim of enriching scrublands to establish new forest plantations, mainly within national parks, river courses, Canal heritage areas and other strategic zones.

During January 2023, 4,452 vessels transited the Panama Canal, of which 71.95% were Panamax size and 28.05% were Neopanamax size.

On March 14, 2022, Metro de Panama awarded the design and construction of the tunnel that will pass under the Panama Canal to the HPH joint venture formed by Hyundai Engineering & Construction Co., Ltd. and Posco Engineering Construction, which is also in charge of constructing the rest of Line 3. The design of the tunnel was initially awarded to the Americas consortium (composed of the Spanish company Typsa and the American company Louis Berger), but the Americas consortium failed to provide the required professional liability policy, so the contract for the tunnel was not finalized. The machinery to be used for tunnel boring is expected to arrive in Panama in late 2023, and the drilling of the 6.1-kilometer tunnel is expected to commence in early 2024.

*The Panama Canal Expansion Project* 

Between July 27, 2022 and July 28, 2022, the arbitral tribunal held the final hearing in connection with Arbitration No. 3 concerning the Gateways. The PCA expects the arbitral tribunal to issue its award during the first half of 2023.

**The Colón Free Zone** 

During the nine-month period ended September 30, 2022, imports to the Colón Free Zone ("CFZ") were preliminarily estimated at U.S.$10.8 billion, an increase from U.S.$6.3 billion during the nine-month period ended September 30, 2021.

During the nine-month period ended September 30, 2022, re-exports to the CFZ were preliminarily estimated at U.S.$8.3 billion, an increase from U.S.$6.8 billion during the nine-month period ended September 30, 2021.

During the nine-month period ended September 30, 2022, Panama's non-CFZ merchandise exports were preliminarily estimated at U.S.$2.8 billion, an increase from U.S.$2.6 billion during the nine-month period ended September 30, 2021.

During the nine-month period ended September 30, 2022, Panama's non-CFZ merchandise imports were preliminarily estimated at U.S.$11.4 billion, an increase from U.S.$8.2 billion during the nine-month period ended September 30, 2021.

On February 9, 2023, the General Manager of the Colon Free Zone, spokespersons for the Coalition of Unity for Colon, representatives of the Ministry of Economy and Finance, members of the Users Association of the Colon Free Zone, members of the Frente Amplio Colonense, members of the Cement Industry Workers Union of Panama and representatives of the Ministry of Labor met in the National Assembly to work towards a consensus on Bill No. 620. Bill No. 620 contemplates modifications to Law No. 8, which regulates the operation of the CFZ. Among its proposed changes, Bill No. 620 (i) adds to the functions of the CFZ's board of directors, enabling the board to authorize judicial and extrajudicial settlements and investments or contracts with values of over $750,000; (ii) proposes certain tax benefits for companies operating within the CFZ, including exempting any transfers of securities to companies in the CFZ from income tax and exempting any commercial and

------

industrial improvements within the CFZ from property tax; (iii) attempts to diversify the CFZ by adding to its permitted activities: services related to cinematography, manufacture and reconversion of products, and scientific research and development; (iv) permits eligible CFZ companies to access the benefits of the Special Regime for the Establishment and Operation of Multinational Companies for the Provision of Manufacturing Services (EMMA); and (v) aligns the CFZ's employment regime with those offered by other special economic zones within Panama, such as the Panama Pacifico Area.

**Employment and Labor** 

*Social Security System (SIACAP)* 

Since its inception in July 2000 through February 28, 2023, SIACAP had administered approximately U.S.$1.9 billion in contributions and revenues, a 5.6% increase from the U.S.$1.8 billion in aggregate contributions and revenues administered as of February 28, 2022.

As of February 28, 2023, SIACAP had 579,701 participants, a 7.7% increase from 538,407 participants as of February 28, 2022. As of February 28, 2023, SIACAP carried a balance of U.S.$829.4 million in contributions from its participants, a 0.6% decrease from U.S.$834.5 million in contributions as of February 28, 2022, mainly due to a decrease in the SIACAP's investment yields as a result of volatility in global markets.

*CSS* 

Within the framework of the Social Security Fund ("CSS") National Dialogue, the International Labor Organization ("ILO") developed a preliminary actuarial study and report on the CSS health, pensions and disability ("IVM") program's pension funds to help guide the IVM Commission's pension reform proposal. On September 19, 2022, the CSS published the ILO actuarial report, which warns of the mixed subsystem's poor design, the possible exhaustion of the total reserve of the defined benefits subsystem by 2024 and the contributions that the Government should make to continue the payment of pensions under the IVM program.

On January 5, 2023, the CSS stated that it was waiting for the ILO to schedule a date to explain its report on the IVM program's pension funds and its recommendations for the pension system in order to reconvene the CSS National Dialogue on the subject.

**Public Finance** 

*Central Government Budget* 

The National Assembly approved Panama's 2023 budget on October 27, 2022. The 2023 budget contemplates total expenditures of U.S.$27.6 billion, with budget estimates based on an anticipated nominal GDP of U.S.$81.9 billion (5.0% real growth from 2022) and an anticipated consolidated non-financial public sector deficit of approximately U.S.$2.2 billion (approximately 3.0% of preliminary nominal GDP) for 2023. The 2023 budget allocates public recurrent and capital expenditures as follows: 42.9% to social services; 15.4% to financial services; 13.4% to general services; 8.0% to infrastructure development; 3.1% to development and promotion of production; 0.9% to environment and technology; and 16.3% to other services.

------

The table below sets forth the budgeted expenditures of the Central Government by function for the indicated budget years:

**<u>TABLE NO. 11</u>**

**Budgeted Expenditures of the Central Government by Function<sup>(1)</sup>** 

**(in millions of dollars)** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Itemization** | **2019** | **2020** | **2021** | **2022** | **2023<sup>(2)</sup>** |
|  Legislative | 123.3 | 99.7 | 107.0 | 144.0 | 150.0 |
|  Judiciary | 183.7 | 166.9 | 182.2 | 205.6 | 330.3 |
|  General Comptroller | 108.3 | 146.3 | 121.6 | 150.9 | 147.4 |
|  Presidency | 798.4 | 595.3 | 206.2 | 218.1 | 225.0 |
|  Government | 311.3 | 290.2 | 527.2 | 537.2 | 677.0 |
|  Foreign Affairs | 66.0 | 67.1 | 64.4 | 68.6 | 67.1 |
|  Education | 2465.3 | 2630.3 | 2674.4 | 2623.7 | 2876.8 |
|  Commerce and Industry | 171.0 | 109.1 | 96.8 | 74.6 | 81.0 |
|  Public Works | 1702.3 | 894.6 | 641.8 | 728.7 | 1243.7 |
|  Agriculture | 249.9 | 190.0 | 349.9 | 334.8 | 437.7 |
|  Health | 2331.4 | 2041.8 | 2202.1 | 2532.1 | 2555.5 |
|  Labor | 45.4 | 46.0 | 39.4 | 36.3 | 39.8 |
|  Housing | 369.5 | 234.1 | 254.4 | 188.1 | 148.5 |
|  Economy and Finance | 962.7 | 786.0 | 895.4 | 795.4 | 758.1 |
|  Social Development | 309.2 | 311.3 | 311.5 | 703.7 | 306.8 |
|  Security | 805.0 | 753.3 | 830.2 | 847.1 | 903.1 |
|  Public Ministry | 183.4 | 166.0 | 202.1 | 207.1 | 251.1 |
|  Environment | 69.6 | 55.1 | 59.8 | 55.5 | 77.6 |
|  Electoral Tribunal | 144.0 | 104.1 | 89.7 | 94.4 | 159.5 |
|  Tax Administrative Court | 3.2 | 3.0 | 3.1 | 2.6 | 3.9 |
|  Court of Accounts | 3.8 | 3.7 | 3.8 | 3.8 | 4.1 |
|  Prosecutor of Accounts | 3.3 | 3.1 | 4.0 | 4.3 | 5.0 |
|  Ombudsman | 5.8 | 5.8 | 6.0 | 6.3 | 7.5 |
|  Culture | 0 | 66.0 | 45.5 | 42.3 | 52.5 |
|  Other expenses | 37.0 | 38.1 | 37.9 | 3815.8 | 4409.4 |
|  **Total** | $**11452.8** | $**9806.9** | $**9956.4** | $**14421.1** | $**15918.4** |

---

Note: Totals may differ due to rounding.

(1) Excluding transfers, subsidies and debt service.

(2) Original 2023 budget, before modifications.

*Source:* Ministry of Economy and Finance.

In 2022, Panama's non-financial public sector balance registered a deficit of approximately U.S.$3.0 billion (3.9% of nominal GDP), a decrease of 30.8% compared to a deficit of approximately U.S.$4.3 billion in 2021 (6.5% of nominal GDP), in part due to a 15.1% increase in current revenues.

In 2022, the Central Government's overall balance registered a deficit of approximately U.S.$3.1 billion (4.1% of nominal GDP), a decrease of 30.9% compared to a deficit of approximately U.S.$4.5 billion (6.7% of nominal GDP) in 2021, in part due to a 17.0% increase in current revenues.

------

*Taxation* 

Preliminary figures indicate that approximately 63.0% of the Central Government's current revenues in 2022 came from various forms of taxation. Central Government tax revenues in 2022 were U.S.$5.8 billion, an increase of 27.7% from U.S.$4.6 billion in tax revenues in 2021. Approximately 57.1% of 2022 tax revenues were from direct taxes, compared to 54.4% of tax revenues in 2021. Direct tax revenues in 2022 were U.S.$3.3 billion, a 34.1% increase from U.S.$2.5 billion in 2021, primarily due to an increase in income and property taxes.

As of February 28, 2023, Panama had signed tax information exchange agreements with Canada, Denmark, Faroe Islands, Finland, Greenland, Iceland, Japan, Norway, Sweden and the United States. Panama has treaties for the avoidance of double taxation and prevention of fiscal evasion that have entered into force with 17 countries, raising to 27 the number of counties with which Panama performs double taxation and prevention of fiscal evasion collaboration.

*Revenues and Expenditures* 

The Central Government's total revenues for 2022 were approximately U.S.$9.3 billion, a 17.0% increase compared to approximately U.S.$7.9 billion in 2021. In 2022, capital expenditures were approximately U.S.$3.7 billion, a 10.6% increase compared to approximately U.S.$3.4 billion in 2021.

In 2022, the Central Government's current savings registered a surplus of approximately U.S.$0.6 billion, approximately 0.8% of preliminary 2022 GDP and a 155.2% increase compared to a deficit of approximately U.S.$1.1 billion in 2021.

The table below sets forth the revenues and the expenditures of the Central Government for the periods indicated:

**<u>TABLE NO. 12</u>**

**Fiscal Performance – Central Government** 

---

| | | |
|:---|:---|:---|
|  | **Period Ended December 31,<br>(in millions of dollars)** | **Period Ended December 31,<br>(in millions of dollars)** |
|  | **2021<sup>(P)</sup>** | **2022<sup>(P)</sup>** |
|  **Total Revenues** | 7933 | 9284 |
|  Adjusted Current Revenue | 7933 | 9284 |
|  Tax Revenue | 4580 | 5850 |
|  Non Tax Revenues | 3341 | 3429 |
|  Capital Income | 12 | 6 |
|  Donations | 0 | 0 |
|  **Total Expenditures** | 12428 | 12392 |
|  Current Expenditures | 9057 | 8664 |
|  **Current Savings** | (1124) | 620 |
|  **Capital Expenditures** | 3371 | 3729 |
|  **Deficit** | (4496) | (3108) |
|  % of GDP | (6.7)% | (4.1)% |

---

Note: Totals may differ due to rounding.

(P) Preliminary figures.

*Source*: Ministry of Economy and Finance.

------

The non-financial public sector, which includes the Central Government, decentralized agencies (including CSS and principal universities) and non-financial public enterprises, had total revenues of approximately U.S.$13.3 billion during 2022, a 13.8% increase compared to approximately U.S.$11.7 billion in 2021, mainly due to an increase in the Central Government's current revenues. Current savings for the non-financial public sector registered a surplus of approximately U.S.$1.1 billion in 2022, a 304.0% increase compared to a deficit of approximately U.S.$0.5 billion in 2021.

The following table sets forth the revenues, by purpose, and expenditures, by sector, of the consolidated non-financial public sector for the periods indicated:

**<u>TABLE NO. 13</u>**

**Fiscal Performance – Consolidated Non-Financial Public Sector** 

---

| | | |
|:---|:---|:---|
|  | **Period Ended December 31,<br>(in millions of dollars)** | **Period Ended December 31,<br>(in millions of dollars)** |
|  | **2021<sup>(P)</sup>** | **2022<sup>(P)</sup>** |
|  **Total Revenues** | 11661 | 13273 |
|  Adjusted Current Revenue | 11390 | 13111 |
|  Capital Income | 17 | 11 |
|  Donations | 0 | 0 |
|  **Total Expenditures** | 16006 | 16279 |
|  Current Expenditures | 12204 | 12202 |
|  **Current Savings** | (533) | 1088 |
|  **Capital Expenditures** | 3802 | 4076 |
|  **Deficit** | (4345) | (3006) |
|  % of GDP | (6.5)% | (3.9)% |

---

Note: Totals may differ due to rounding.

(P) Preliminary figures.

*Source*: Ministry of Economy and Finance.

The following tables set forth the revenues, by purpose, and expenditures, by sector, of the Central Government and the consolidated non-financial public sector for the years 2018 through 2022. Under the terms of the 1994 amendments to the Constitution, the Panama Canal Authority budget is not included in the budget of the Central Government.

------

**<u>TABLE NO. 14</u>**

**Central Government Operations** 

**(in millions of dollars)** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2018** | **2019** | **2020** | **2021<sup>(P)</sup>** | **2022<sup>(P)</sup>** |
|  **Total Revenues** | $**9010.3** | $**8496.6** | **6725.1** | **7932.6** | **9283.9** |
|  Current Revenues | 8990.8 | 8486.6 | 6724.1 | 7932.6 | 9283.9 |
|  Tax Revenues | 5918.2 | 5499 | 4017.3 | 4579.6 | 5849.6 |
|  Direct | 3305.4 | 2956.7 | 2263.6 | 2490.2 | 3339.9 |
|  Indirect | 2612.8 | 2542.3 | 1753.8 | 2089.4 | 2509.8 |
|  Non Tax Revenues | 3072.6 | 2987.6 | 2692.5 | 3340.7 | 3428.7 |
|  Adjustments to Rent |  |  |  |  |  |
|  Capital Gains | 19.5 | 10 | 14.2 | 12.3 | 5.6 |
|  Donations | 0 | 0 | 1 | 0 | 0 |
|  **Total Expenditures** | $**11081.6** | $**11258.2** | **11653.9** | **12428.1** | **12392.3** |
|  Current Expenses | 7265.7 | 7566.2 | 8115.7 | 9057 | 8663.5 |
|  Wages and Salaries | 3120.2 | 3210.9 | 3556.7 | 3791.8 | 3899.3 |
|  Goods and Services | 779.5 | 666.1 | 685.9 | 609.3 | 751.6 |
|  Transfers | 2117.3 | 2280 | 2371.5 | 2877.6 | 2615.5 |
|  Interest | 1148.3 | 1258.4 | 1416.1 | 1539.9 | 1317.5 |
|  Others | 100.4 | 150.9 | 85.5 | 238.3 | 79.7 |
|  **Current Savings** | $**1725.1** | $**920.4** | **(1391.7)** | **(1124.4)** | **620.4** |
|  % of GDP | 2.7% | 1.4% | (2.6)% | (1.7)% | 0.8% |
|  Total Savings | 1744.6 | 930.4 | (1390.7) | (1124.4) | 620.4 |
|  % of GDP | 2.7% | 1.4% | (2.6)% | (1.7)% | 0.8% |
|  **Capital Expenditures** | $**3815.9** | $**3692.0** | **3538.1** | **3371.2** | **3728.8** |
|  **Primary Balance** | $**(923.0)** | $**(1503.3)** | **(3512.7)** | **(2955.6)** | **(1790.9)** |
|  % of GDP | (1.4)% | (2.3)% | (6.5)% | (4.4)% | (2.3)% |
|  **Surplus or Deficit** | **(2071.3)** | **(2761.6)** | **(4928.8)** | **(4495.5)** | **(3108.4)** |
|  % of GDP | (3.2)% | (4.1)% | (9.1)% | (6.7)% | (4.1)% |

---

Note: Totals may differ due to rounding.

(P) Preliminary figures.

*Source:* Ministry of Economy and Finance.

------

**<u>TABLE NO. 15</u>**

**Consolidated Non-Financial Public Sector Operations** 

**(in millions of dollars)<sup>(1)</sup>** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2018** | **2019** | **2020** | **2021<sup>(P)</sup>** | **2022<sup>(P)</sup>** |
|  **Revenues:** |  |  |  |  |  |
|  General Government |  |  |  |  |  |
|  Central Government | $8823.3 | $8360.9 | $6588.5 | $7782.3 | $9159.9 |
|  CSS | 3656.4 | 3711.9 | 3055.5 | 3415.8 | 3720.6 |
|  Consolidated agencies | 241.8 | 256.1 | 183.1 | 174.2 | 219.5 |
|  Total | 12721.5 | 12328.9 | 9846 | 11389.5 | 13111.4 |
|  Public Enterprises Operations Surplus (Deficit) | (39.9) | 8.8 | (53.4) | (6.8) | (10.7) |
|  Nonconsolidated Agencies Surplus and Others | 63.2 | 52 | 137.7 | 288.4 | 189.1 |
|  Capital Revenues | 40.2 | 10.9 | 18.8 | 17.1 | 11.3 |
|  Donations | 0 | 0 | 1 | 0 | 0 |
|  **Total** | $**12755.7** | $**12382.8** | $**9894.2** | **11660.8** | **13273.2** |
|  **Expenditures:** |  |  |  |  |  |
|  General Government |  |  |  |  |  |
|  Central Government | 5409.9 | 5456.4 | 6120.1 | 6444.6 | 6537.3 |
|  CSS | 3451.4 | 3629.7 | 3746.2 | 3891.8 | 4001 |
|  Consolidated agencies | 281.7 | 299.2 | 316.5 | 327.7 | 346.4 |
|  Total<sup>(2)</sup> | $9143.1 | $9385.3 | $10182.7 | $10664.2 | $10884.7 |
|  Capital Expenditures | 4316.2 | 3646.1 | 3816.9 | 3801.9 | 4076.4 |
|  Total | $13459.3 | $13031.4 | $13698.9 | $14466.1 | $14961.1 |
|  Debt Interest Paid | 1154.9 | 1264.7 | 1416.1 | 1539.9 | 1317.5 |
|  **Total Consolidated Non-Financial Public Sector Expenditures** | $**14614.2** | $**14296.1** | $**15415.7** | $**16006.0** | $**16278.7** |
|  **Balance** | **(703.6)** | **(648.5)** | **(4105.4)** | **(2805.3)** | **(1688.0)** |
|  **Overall Surplus (Deficit)** | $**(1858.5)** | $**(1913.3)** | $**(5521.5)** | $**(4345.2)** | $**(3005.5)** |
|  Percentage of GDP (nominal) | (2.9)% | (2.9)% | (10.2)% | (6.5)% | (3.9)% |

---

Note: Totals may differ due to rounding.

(P) Preliminary figures.

<sup>(1)</sup> Non-Financial Public Sector excludes PCA, BNP and Caja de Ahorros.

<sup>(2)</sup> Excluding interest payments.

*Sources*: Office of the Comptroller General, Ministry of Economy and Finance and other public institutions.

*Administration of Public Funds* 

As of January 31, 2023, the Treasury Single Account ("TSA"), an official bank account administered by the Ministry of Economy and Finance, in which all public revenues will be deposited and from which payment of the obligations of public institutions will be made was in phase III, having incorporated over 80% of accounts holding public funds.

------

*International Reserves* 

As of December 31, 2022, BNP's foreign assets amounted to U.S.$4.0 billion, a decrease of 43.5% compared to U.S.$7.0 billion as of December 31, 2021.

------

The following table sets forth certain information regarding Panama's international reserves at December 31 for the years indicated:

**<u>TABLE NO. 16</u>**

**International Reserves<sup>(1)</sup>** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2018** | **2019** | **2020** | **2021** | **2022** |
|  Foreign Exchange | $1696.0 | $2912.7 | $7878.3 | 6946.9 | 3893.9 |
|  Reserve Position in IMF | 75.7 | 75.2 | 78.4 | 76.2 | 72.4 |
|  **Total<sup>(2)</sup>** | $**1771.7** | $**2988.0** | $**7956.7** | $**7023.0** | $**3966.3** |

---

Note: Totals may differ due to rounding.

(1) In millions of dollars

(2) Foreign assets of BNP in millions of dollars

*Source*: IMF and BNP.

**Financial System** 

In 2022, the financial services sector increased by 5.5% mainly due to local financial services and commissions earned.

*The Banking Sector* 

As of December 31, 2022, two state-owned banks, 40 private sector general license banks, 14 international license banks and 10 representative offices constituted the banking sector. Of the 40 private sector general license banks, 13 were incorporated in Panama and the rest abroad.

As of December 31, 2022, measured by assets, the largest bank based in Panama was *Banco General, S.A.*, with U.S.$17.2 billion in assets, and the second largest bank based in Panama was Banco Nacional de Panamá with U.S.$14.6 billion in assets. Two of the other largest banks, based on assets, are *Banistmo, S.A.* and BAC International Bank Inc. The largest international license banks, based on assets, are *Bancolombia (Panama), S.A.*, ASB Bank Corp. and *Banco de Bogotá S.A.*

As of December 31, 2022, total assets of the banking sector were approximately U.S.$140.0 billion, 5.0% more than approximately U.S.$133.4 billion as of December 31, 2021. As of December 31, 2022, deposits in the banking sector were approximately U.S.$98.4 billion, 1.4% higher than approximately U.S.$97.0 billion as of December 31, 2021.

*Banking Law* 

On February 24, 2023, the FATF, upgraded Panama's compliance rating, noting the completion of 13 of the 15 action items that were established in Panama's FATF Action Plan to improve its framework against money laundering and terrorism financing in June 2019. The FATF urged Panama to quickly complete its Action Plan by June 2023.

------

*Public Sector Banking Institutions* 

*Banco Nacional de Panamá*. BNP offers a wide range of commercial banking services through its 92 branches and 358 ATMs throughout Panama as of December 31, 2022. In accordance with the law that governs BNP, the Republic of Panama is responsible for the liabilities of BNP. BNP is the largest public sector banking institution in Panama in terms of domestic credit, local deposits and savings deposits. BNP's total assets as of December 31, 2022 were U.S.$14.6 billion, its bank deposits were U.S.$4.2 billion, and its net loans were U.S.$5.8 billion.

As of December 31, 2022, BNP's capital and reserves represented 27.2% of its bank deposits and 7.8% of its total assets. BNP generated gross revenues of U.S.$470.0 million in 2022.

As of December 31, 2022, BNP's foreign assets were U.S.$3.9 billion, a decrease of 44.0% compared to U.S.$6.9 billion as of December 31, 2021.

*Caja de Ahorros.* Caja de Ahorros, the state-owned savings bank, had 62 branches and 308 ATMs throughout Panama as of December 31, 2022. Caja de Ahorros is primarily a mortgage lender specializing in financing medium-income customers. Due to its liquidity position in recent years, however, Caja de Ahorros has begun to promote personal loans. Total assets of Caja de Ahorros as of December 31, 2022, amounted to U.S.$6.1 billion (a 19.6% increase from December 31, 2021) and total deposits amounted to U.S.$4.9 billion (a 25.6% increase from December 31, 2021). Total net loans held by Caja de Ahorros as of December 31, 2022 amounted to U.S.$3.9 billion (a 11.4% increase from December 31, 2021). Caja de Ahorros had net income of U.S.$17.3 million for 2022, compared to net income of U.S.$13.7 million for 2021. In accordance with the law that governs Caja de Ahorros, the Republic of Panama is responsible for the liabilities of Caja de Ahorros.

*Other Public Sector Institutions.* The Panamanian public sector includes two other significant institutions that are not part of the banking sector: the agricultural development bank, *Banco de Desarrollo Agropecuario* ("BDA"), and the national mortgage bank, *Banco Hipotecario Nacional* ("BHN"). Panama created BDA to provide a source of financing for agricultural development. BDA's activities have mainly focused on providing financing to medium and small producers. As of December 31, 2022, figures indicate that BDA had U.S.$244.2 million in net loans on its books. As of December 31, 2022, the total assets of BDA were U.S.$424.5 million. BDA had a net loss of approximately U.S.$1.0 million in 2022.

BHN was established in 1973 to provide a source of financing for national housing projects and to foster the development of savings associations. As of December 31, 2022, BHN's net loan portfolio was U.S.$90.6 million and its total assets amounted to U.S.$335.5 million. BHN had a net loss of U.S.$9.5 million in 2022.

*Other Financial System Components* 

*Stock Exchange*. In 1990, a private stock exchange, la Bolsa de Valores de Panamá, was created. The stock exchange recently changed its name to *Bolsa Latinoamericana de Valores* ("Latinex"). While it has had considerable growth, with aggregate trades increasing from U.S.$30.6 million in 1991 to U.S.$6.1 billion in 2022, Latinex remains a small portion of the financial services sector. Equity trades represented 6.7% of trading volume in 2022. In 2022, local secondary market transactions (which include both equity and debt trades) in Panama totaled U.S.$1.3 billion.

*Interest Rates*. In 2022, the average interest rate paid by Panamanian banks for one-year deposits was 2.72%, while the interest rate for personal credit transactions averaged 8.54%. In general terms, the differential between borrowing and lending interest rates for Panamanian banks was 5.82% in 2022.

*Insurance*. As of December 31, 2022, there were 23 insurance companies and 3,325 insurance brokerages. The 3,325 insurance brokerages consisted of 2,803 individual brokers, 407 brokerage companies and 115 temporary permissions. The total registered assets of the insurance companies as of December 31, 2022 equaled U.S.$3.7 billion.

*Financial Services*. A small non-deposit-taking financial services industry provides leasing, consumer durables financing and other small-scale lending. As of December 31, 2022, there were 181 locally incorporated companies participating in this industry.

------

**Foreign Trade and Balance of Payments** 

*Composition of Foreign Trade* 

In the nine-month period ended September 30, 2022, Panama's exports of goods (FOB), excluding the CFZ, recorded a preliminary total of U.S.$2.8 billion, an increase of 8.8% compared to U.S.$2.6 billion in the same period of 2021, mainly due to increased exports of shrimp, unrefined sugar and other goods. In the nine-month period ended September 30, 2022, Panama's imports of goods (CIF), excluding the CFZ, recorded a total of U.S.$11.4 billion, an increase of 40.0% compared to U.S.$8.2 billion in the same period of 2021, in part due to higher imports of consumer goods, specifically fuels, lubricants and related products.

For the nine-month period ended September 30, 2022, exports of copper ores and concentrates recorded a preliminary total of U.S.$2.2 billion, a 6.3% increase from U.S.$2.0 billion in the same period of 2021, primarily due to growth in export volumes from increased demand.

For the nine-month period ended September 30, 2022, banana and pineapple exports recorded a preliminary total of U.S.$99.9 million, a 15.3% decrease from U.S.$118.0 million in the same period of 2021, primarily due to lower exports of banana.

For the nine-month period ended September 30, 2022, shrimp exports recorded a preliminary total of U.S.$39.7 million, a 110.2% increase from U.S.$18.9 million in the same period of 2021, primarily due to higher sales in Taiwan.

For the nine-month period ended September 30, 2022, exports of frozen yellow fin tuna and fresh and frozen fish filets recorded a preliminary total of U.S.$38.80 million, a 0.1% decrease from U.S.$38.85 million in the same period of 2021.

For the nine-month period ended September 30, 2022, fishmeal exports recorded a preliminary total of U.S.$25.4 million, a 20.8% increase from U.S.$21.0 million in the same period of 2021, primarily due to growth in export volumes from increased demand.

*Foreign Direct Investment* 

On December 15, 2022, President Cortizo, together with the Cabinet Council, instructed the Minister of Commerce and Industry, the Minister of Environment and the Minister of Labor and Labor Development to adopt administrative measures in order to comply with the 2017 judgment of the Supreme Court of Justice that declared the contract between the Panamanian State and the company Minera Panamá S.A. (formerly Minera Petaquilla, S.A.) unconstitutional. President Cortizo stated that the decision came after Minera Panamá failed to fulfill its January 2022 commitment to work towards a reasonable and satisfactory concession contract that establishes fair benefits for both parties.

On January 26, 2023, the Panama Maritime Authority issued Resolution No. 007-2023 requiring Minera Panamá S.A. to suspend copper concentrate loading operations at the port of Punta Rincon until the company demonstrates the certification process of the calibration of the scales by an accredited company.

On February 23, 2023, First Quantum Minerals Ltd. announced that its subsidiary, Minera Panamá S.A., was suspending ore processing operations at the Cobre Panama mine as a the result of the refusal by the Panama Maritime Authority to allow copper concentrate loading operations at the mine's Punta Rincón port.

On March 8, 2023, the Government of Panama and Minera Panamá S.A. announced that they had reached agreement on the final text of the concession contract that will govern the long-term operation of the Cobre Panama project. The proposed new concession contract will have an initial 20-year term, with a 20-year extension option, and meets the Government's objectives with respect to equitable sharing of royalties and taxes

------

for Panama's natural resources, with expected minimum revenues for the Government of U.S.$375 million each year (approximately 10 times more than the Government received under the 1997 concession contract). The proposed concession contract is subject to a 30-day public consultation process and approvals by the Panamanian Cabinet, the Comptroller General and the National Assembly.

In 2022, Cobre Panama produced 350,438 tons of copper concentrate, 139,751 ounces of gold and 2.8 million ounces of silver, and generated gross sales of U.S.$2,959 million.

**Public Debt** 

As of February 28, 2023, total public debt totaled U.S.$44,163.4 million, an increase from U.S.$42,879.3 million as of February 28, 2022. As of February 28, 2023, internal public debt accounted for 16.8% of total debt (a decrease from 17.8% as of February 28, 2022), while external public debt accounted for 83.2% of total debt (an increase from 82.2% as of February 28, 2022). The average maturity of the debt portfolio as of February 28, 2023, was 14.9 years, with an average duration of 9.3 years. The average maturity of the debt portfolio as of February 28, 2022, was 15.5 years, with an average duration of 9.9 years. As of February 28, 2023, local secondary market transactions in treasury securities reached U.S.$79.4 million, a increase from U.S.$26.7 million as of February 28, 2022.

*External Debt* 

*Global Notes and Bonds* 

On November 21, 2022, Panama issued U.S.$1,500,000,000 aggregate principal amount of its 6.400% Global Bonds due 2035 as a prefunding transaction for the 2023 budget. Shortly thereafter, on December 1, 2023, Panama repurchased U.S.$484,948,000 aggregate principal amount of its 4.000% Global Bonds due 2024.