As part of the commercial talks that accompanied the visits of several Latin American presidents to the EXPOCOMER trade fair, Panama's President Mireya Moscoso and El Salvador's President Francisco Flores signed a bilateral free trade treaty and these heads of states plus representatives of five other Central American countries agreed that the Panama - El Salvador agreement would serve as a benchmark for the negotiation of a regional free trade zone. The agreement, which covers more than 80 percent of each country's exports to the other, eliminates import duties. The main exceptions are in the area of agricultural commodities. Central American free trade has received mixed reviews from the business communities in all countries concerned, with vigorous opposition from those who enjoy national monopolies, exclusive distributorships and government subsidies on the one hand and general support from the manufacturing and financial services sectors on the other. Farmers and labor unions tend to oppose free trade.

On March 7, Panamax freighter Diana Z began taking on water through a rupture in its hull as it was leaving the Gatun Locks. Canal firefighters and tugs came to the rescue and the ship was towed to deeper water and the hole was patched. The Panama Canal Authority says that there was no collision in the locks, which would mean that the vessel must have struck an underwater obstacle in the shipping channel of Gatun Lake that should not have been there.

Though there is an ambitious plan to expand the Panama Canal's watershed by way of several dams and a new lake in western Colon and northern Cocle provinces, another way to increase the canal's water supply is to make Gatun and Madden lakes deeper. That project began with a blast on March 8, when the guest of honor, Brazilian President Fernando Enrique Cardoso, pushed a button that set off a blast near Gamboa. Cardoso expressed his country's support for the canal's expansion and modernization.

As the product of a joint venture in investigative journalism by La Prensa and the Guatemalan daily Siglo Veinteuno, the two newspapers reported that Guatemalan President Alfonso Portillo and several of his political associates and relatives have set up a network of Panamanian bank accounts and corporations into which large sums of money that would not have come from legal sources have been transferred. The Guatemalan daily also reported that large campaign contributions were made to Portillo's warchest via a Panamanian company, and that Panamanian public officials were involved in setting up the alleged financial network. The denials made by Portillo and various others who are accused have been vehement, but have generally not addressed the central details that the newspapers' reports allege.

The IDAAN public water and sewer utility has announced that it will begin shutting off the water flow to customers who are two months or more in arrears in their bills. Some $60.4 million is owed by consumers to IDAAN. In some areas, many people haven't paid a water bill in years. Labor leaders warn of epidemics and riots if the country's poorer neighborhoods lose their water supplies.

Panama City's mayor, Juan Carlos Navarro, has cancelled the liquor licenses of some 2,033 stores, bars, restaurants and clubs with unpaid municipal taxes, and has ordered the city's corregidors to proceed to close the businesses. The most affected part of the city is Bella Vista, where more than 400 establishments have had their licenses cancelled.

On March 8 the Interoceanic Regional Authority (ARI) published a list of 342 tenants of buildings that it owns in France Field, Coco Solo, Margarita, Mindi, Davis, Espinar (Gulick) and Arco Iris (Rainbow City) who are between five and 124 months in arrears in rent payments. Some of the listed tenants are actually landlords who sublet the houses or apartments that they obtained from ARI. On the list were a number of members of well connected political families (Escalona, Chiari, Boyd, Ford, Brenes, etc.), most of whom haven't paid rent in years.

On March 7 Customs agents seized 1,001 cartons of cigarettes from Juliety Import and Export in the Colon Free Zone. The smokes bore the markings of Philip Morris's Marlboro brand, but in fact were pirate copies of the leading tobacco product.

The National Association for the Conservation of Nature (ANCON) has belated joined most of the nation's other environmental groups in calling for changes to the Multimodal Industrial and Service Center (CEMIS) project, which would expand France Field into an international freight airport, create a container handling link among the airport, the Coco Solo Norte and Manzanillo International Terminal seaports and the Panama Canal Railway, and develop commercial and industrial projects in the adjacent areas. Like the Audubon Society and other groups, ANCON objects to the destruction of mangroves and other project features that it said would harm the area's important coral reefs and bird habitats. However, ANCON is not opposed to the project in principle, if modifications are made.

While the Inter-American Development Bank is delaying its loan decisions to see the results of investigations into allegations that legislators were bribed to approve the Multimodal Industrial and Service Center (CEMIS) project and some critics are calling for the rescission of the government concession that authorizes it, in Colon there's still widespread support for the project because it's seen as a way to create jobs for the economically depressed province. According to CEMIS president Louis Sola, one recent manifestation of that support was a decision by the Cooperativa de Ahorro y Credito Cristobal to invest some of its funds into the project.

Cable & Wireless has announced that its Internet customers can now use the Net Filter service to block access to sites featuring pornography or reports about crimes or drugs. In the past, the company has blocked its Internet customers' access to The Panama News and a number of other small businesses as well, posting messages that these sites are "illegal."

The Health Ministry has ordered two brands of bottled water, "Agua Purissima" and "Agua de la Montaña," off the market. Repeated inspections found that the water was contaminated with bacteria. If the companies clean up their acts and start producing sterile bottled water, they can apply to return to business in two months.

The cash-strapped city of San Miguelito has found another source of income, or so the city council hopes. Dog owners will now be required to buy dog license, and to equip their canines with collars with up-to-date dog tags. The measure isn't just to collect revenue: dogs will have to get their proper vaccinations to qualify for a license, and the dog tag requirement will make it easier for the city to control the proliferation of packs of stray animals.

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