Things simmer down, sort of, with mixed economic news

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Gung Ho
The China card: this is the first batch of Panamanian students to get scholarships to study Mandarin in China. President Varela says that when they come back they will by and large get good jobs with Chinese-owned companies that are moving operations to Panama. Photo by the Presidencia.

Headache reductions

by Eric Jackson

Yes, the SUNTRACS folks were out on the streets of Panama City on Tuesday, March 20, most notably blocking traffic on Via España in front of Ricardo Martinelli’s NexTV television station. But that morning the same construction workers’ union also concluded a marathon negotiation with Minera Panama, the local subsidiary of First Quantum, to end a 12-day strike at that company’s copper mine in western Colon province.

The previous day, Colon teachers agreed to go back to work after a week-long strike, with government and community leaders beginning four sets of negotiations, about education, health, transportation and housing in the troubled Atlantic Side city. Matters were eased by two factors from the previous week. First, that nobody was killed in the protests or the burning and looting by people, many of them masked, who were not part of the protests. Second, that among Panamanians in general and Colon residents in particular there was a general consensus that the several dozen people arrested for looting or vandalism and the small group of people injured when the police moved in deserved it.

But also the previous day, it became internationally known (athough workers here had already been told) that Caterpillar’s regional training facility here was shutting down forever. At its peak it was a source of employment for about 800 people, who learned repair, assembly and sales skills and did bits of that sort of work in the process. The move was part of a general downsizing of the company that entails the loss of some 9,000 jobs in at least three countries, most of them in the United States.

Panama has new lines of credit from China and in the short term that calms foreign investors and ratings agencies. But Panama’s debt is at record levels and rising. Any reckoning for that probably happens after President Juan Carlos Varela leaves office in the middle of next year — unless other processes force him out earlier — but the strategy of a party retaining power via an election year spending spree has never worked in Panamanian politics.

Shipping is a mixed bag, with the Panama Canal becoming an important new route for liquid natural gas and some brighter prospects for Brazilian grain, but with container shipping and the import/export business in the doldrums. Plus the competing Arctic shipping routes are opening years before the Panama Canal Authority ever admitted was possible.

The political crises do not abate. Nor are there large howling mobs in the streets, looking to take governmental scalps. However, any compromise solution that the voters are likely to accept is not a matter of public discussion at this time.

The pressure goes down, but the heat isn’t turned off.

 

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