The Legislative Assembly has passed a law that would erase individuals' credit records after seven years, except in cases where coute cases have been brought. The measure is opposed by most of the business community and almost all of the banks, who have asked President Moscoso to veto it. Proponents say it would ease credit for people who have been ruined by the current economic crisis or who were wiped out in the troubles preceding the 1989 US invasion, but critics say that the law's likely effect would be to reduce credit possiblities for everybody. The law also would ban the inclusion of information about telephone, water and electricity bill payments in credit histories. President Moscoso hasn't said whether she will sign or veto the measure.

At this year's CADE business executives' summit, the theme of which is the future of Panama's financial sector, Foreign Minister José Miguel Alemán said that one of the government's principal tasks is strengthening institutional controls to keep criminals from using Panamanian financial services. The country was placed on the International Financial Action Task Force's blacklist of countries that don't cooperate against money laundering in 2000, after President Moscoso backtracked on Panama's treaty commitment to ban the laundering of the proceeds of political corruption, but as Alemán pointed out, the money laundering laws were strengthened and Panama was removed from the list in June of last year. Now it's illegal to launder money from a wide range of criminal activities in this country. Since the changes were made, Panama has assisted in several international investigations of money laundering connected to non-drug crimes, including searches for the ill-gotten fortunes of corrupt Mexican and Peruvian former public officials. The current controversy in Panama is whether to cooperate with the United States and other developed countries in their efforts to track down tax evaders --- the Organization for Economic Cooperation and Development has Panama on a blacklist of countries whose bank secrecy makes tax evasion easier, and banking and political leaders disagree about a proposed tax information sharing agreement with the United States that would effectively end Panamanian banking secrecy.

The Catholic Church's Inter-Diocese Commission has called upon the Panamanian government to stop its studies for the Panama Canal's expansion and have asked for the repeal of the 1999 legislation providing for the addition of a western watershed project that would create new lakes in wester Colon and northern Cocle provinces. The church argues that the plan and the ongoing studies to implement it have created needless tensions in the communities that would be affected. The canal expansion plan has prompted public protests from a number of sectors, and is recently under strong criticism from business experts who say that the project probably could not be paid for by increased canal toll revenues.

The Ministry of Education is refusing to recognize the validity of diplomas and professional titles awarded by Panama's leading academic center the Catholic Santa Maria la Antigua University (USMA). The ministry claims that USMA's diplomas are illegal because the Catholic university is not run by the University of Panama, which by all but the most partisan accounts has far inferior academic standards. The law in question permits diplomas that are by universities that have either been approved by the University of Panama or by law. USMA degrees had previously been approved by law, but apparently the administration of Mireya Moscoso --- whose higher education consists of several credits toward an associates' degree in interior decorating from Dade College, a two-year institution in Miami --- is not convinced that Catholic educators are competent.

The Panama Canal's toll receipt for the first quarter of 2002 were $294.4 million, down $6.6 million from the same period of 2001. The decline corresponds to a general worldwide economic slowdown, which was underway most of last year and became more acute after September 11.

Alberto Vallarino's Banistmo empire is continuing to expand, most recently with the approval of its acquisition of the Banco de Latinoamerica, SA (Bancolat) by the boards of directors of both institutions. Shareholders in Bancolat's corporate parent, Inversiones Latinoamericanos, SA (Inverlat) will receive Banistmo shares in exchange. The deal is subject to approval of shareholders of both banks and Panama's banking superintendent.

The Interoceanic Regional Authority's (ARI's) $3.7 million contract with the International Finance Corporation (IFC) to promote the development of the former Howard Air Force base has been suspended. ARI says that the events of this past September 11 have wrecked the chances of international investments of the size that Panama seeks for Howard for the time being. It also seems that the Moscoso administration has other plans for Howard, as part of her controversial Governmental City project to sell Albrook Field to private developers and then rent it back from them. The IFC, a World Bank agency, had recommended the creation of a special economic zone, with various tax breaks and other business incentives, to promote Howard's development.

Unless a new labor contract is signed by the Panamanian Construction Chamber (CAPAC), the militant SUNTRACS construction workers' union says its members will walk off their jobs on April 24. The weak economy has affected construction, which in turn weakens SUNTRAC's hand in contract negotiations. The union has a reputation for talking tough but settling for what the market will bear.

The Legislative Assembly and the Moscoso administration don't agree on much these days, but one thing about which they are in accord is that they want to finance mega-projects with real estate in the former Canal Zone. However, ARI says that the legislature's and administration's expectations are wildly inflated, both as to the amount of land available and especially as to its price. ARI says that much of the land that the politicians want is commited to the Panama Canal Authority, and that other areas are ecologically protected zones. Moreover, while a legislative committee has valued the real estate at $300 per square meter, ARI's estimate is $12.50. In a national dialogue about the economy, the political parties and business representatives agreed on the use of former Canal Zone real estate to finance new projects, but the labor representatives are opposed to this.

Panama Ports, a subsidiary of Hutchison Whampoa that runs the ports of Balboa and Cristobal, is asking the government for revisions to its contract to run these facilities. The company's contract has a clause that grants them the right to the same terms granted to other ports, and the Manzanillo International Terminal, Coco Solo Norte and CEMIS developments all get benefits not specified in Hutchison Whampoa's contract. The request is likely to be the first of several similar moves, as the Consorcio San Lorenzo's CEMIS deal includes extraordinary tax breaks and government subsidies that the Colon Free Zone and the nation's ports will all probably demand for themselves.

Despite commitments to international lenders and as plea from Minister of Economy and Finance Norberto Delgado, there won't be any tax reform legislation this year. The suggestion prompted loud protests from business leaders and President Moscoso agreed that now is not the time to touch the controversial and potentially economically disruptive subject.

The TRICOM trunk radio telephone system, which is more or less like a cell phone operation using slightly different technology, has begun operations. Lawsuits by BellSouth and Cable & Wireless, who allege that their concessions are violated by TRICOM's existence, are still pending.

Relations between Canada and the United States are strained after a federal court convicted Canadian businessman James Sabzali under the US Trading with the Enemy Act for selling water treatment chemicals to Cuba. The transactions all took place in Canada, where the law prohibits discrimination against Cuban customers on account of US embargo laws. Sabzali and two American business executives who supplied Sabzali's Canadian company with US-manufactured chemicals face possible 200-year prison terms (though prosecutors are asking for only five years behind bars), and Canada has lodged diplomatic protests about it. If the prosecution stands up on appeal, the precedent would exist to jail any Colon Free Zone merchant who sells US-made products to Cuba.

The Cabinet Council has authorized the government's IPAT tourism agency to solicit bids for a 20-year private concession to run the ATLAPA convention center. A number of previous privatization attempts have failed, as successive governments have wrongly presumed that the Chamber of Commerce would rather pay an inflated price than see this key economic asset disappear. The chamber and two other entities have been declared qualified to submit bids.

Comptroller General Alvin Weeden has announced that in 255 audits his office has conducted with respect to the functioning of public ministries, agencies and semi-autonomous entities during the Moscoso administration, unspecified irregularities have been uncovered in nine ministries, the National Bank Panama, the Agricultural Development Bank, the Caja de Ahorros and the Social Investment Fund (FIS). He says that he has referred 115 cases to prosecutors for possible criminal charges and 140 to the Directorate of National Patrimony for possible civil actions to recover public property. Weeden did not release the names of those suspected of misappropriating public property or the types or amounts of property involved. According to the comptroller, the most abuses were found in housing, government and justice and education ministries.

The Comptroller General is investigating FIAFOR, a supposedly non-governmental agro-forestry research foundation whose directors are government officials and much of whose money comes from the government. Alvin Weeden wants to know where the money has gone, and apparently the books have not been well kept.

On April 3 the Ministry of Commerce and Industry announced a 7¢ per gallon increase in the price of gasoline. The hike is attributed to a worldwide petroleum price hike that's mainly caused by increased political tensions in several of the world's main oil producing regions.

The Free Trade and Consumer Affairs Commission (CLICAC) has brought price fixing charges against two supermarket chains and four slaughterhouses, alleging an illegal scheme to fix the prices of several cuts of meat. One of the supermarket chains accused, Super 99, is owned by Canal Affairs Minister Ricardo Martinelli. The other, Casa de la Carne, was affected by a scandal last year arising from its sale of illegally imported Uruguayan beef. The slaughterhouses named in the complaint are also associated with supermarket chains, so that a monopolistic agreement among the accused businesses would cover the majority of Panama's retail market.

The Panama Canal Authority has signed an agreement with the US Emergency Response Team, which is composed of the Federal Emergency Management Agency and several other American governmental institutions, that would permit US assistance in the event of a disaster in the Panama Canal. The agreement was announced while there's a pending debate over legislation that would ban the transit of nuclear cargoes through the canal. Now, if Osama bin Laden's minions crash an airplane into a nuclear waste ship as it is passing though the locks, Panama can be assured that the best American experts will rush to the scene to tell us that there is little or nothing that can be done. The agreement does, however, promise Panama some more useful assistance in the event of a lesser and more likely disaster.

Panama's post office will be taking the unusual step of issuing a stamp bearing the image of a living person --- none other than one Mireya Moscoso Rodr’guez. The president's mug will grace letters as part of a series of stamps honoring outstanding Panamanian women.

Panama's post offices have begun to return letters addressed to subsidiaries and employees of businesses through businesses' mailboxes. Under the new policy, letters addressed to The Panama News, which had come through for the more than seven years of our existence, are now being returned to senders rather than deposited in the mailbox of our parent company, Sun Publishing. (We intend to pay extra to get The Panama News also listed on the box, if the bureaucrats allow this.) The new practice, which had not been announced in advance, has meant headaches and waylaid checks for many of Panama's small businesses.

On April 1 some 170 farm families blocked the road that connects Bocas del Toro with the rest of the country for six hours, because their land was taken for the construction of the Punta Peña - Almirante road and the compensation that they are owed has not been paid. The total overdue bill for all of the affected farmers is $364,000.

The collection, sale and consumption of shellfish taken from the Aguadulce area has been temporarily prohibited by the National Maritime Authority, due to a bloom of the toxic red tide algae. It seems that red tide has been making its was east along the Pacific coast since it made its appearance in Chiriqui a few months ago.

The annual 60-day moratorium on shrimping is over, but due to dwindling ocean shrimp stocks the National Port Authority is now considering a second annual pause in shrimping activities. The problem is part of a worldwide collapse of ocean fisheries, but bodes well for the future of Panama's relatively new shrimp raising industry, whose tank and pond production is not subject to the regulations on the taking of wild ocean shrimp.

The Ministry of Health has lifted is prohibition against the importation of salt for the food processing industry. The ban had been imposed under the argument that industrial salt is not iodized, as the ministry requires with table salt. Iodine is added to table salt in order to prevent goiter, an iodine deficiency disease. The ministry's application of the regulation to industrial salt was supported by the nation's salt producers, who don't like the competition from imports. However, Panamanian food processing companies didn't like the higher prices that came with the ban and international salt vendors probably would have forced Panama to back down on the regulation had the issue come before a World Trade Organization tribunal.

Canal Affairs Minister Ricardo Martinelli has become embroiled in a dispute with National Police Chief Carlos Barés over the police department's decision to contract with a single source to buy meals for officers. The contract specifications that the department wrote were designed so that only the Niko's restaurant chain --- and not, for example, Martinelli's supermarkets --- would qualify to take part in the bidding process.

Former Bolsa de Valores president Gilberto Sucre has resigned as editor-in-chief of La Prensa, alleging that the board of directors headed by former Foreign Minister Ricardo Alberto Arias has not been giving him the support that he needs. During Sucre's tenure the paper suffered financial setbacks like all of Panama's advertising-dependent media, completed a purge of foreign journalists that harmed La Prensa's international reputation, was embroiled in a number of copyright piracy disputes, and was forced to admit that it published bogus inflated figures for its daily circulation. It seems, however, that Sucre's argument with Arias was about profitability, not ethics.

Rosario Arias de Galindo has retired as president of EPASA, the media company that publishes Panama's largest-circulation newspaper, the sensationalistic tabloid La Critica, and the far more respectable broadsheet daily El Panama America. The daughter of the late Panamanian President Harmodio Arias, who founded El Panama America, Arias de Galindo rebuilt the family media business, whose major properties were expropriated during the time of the military dictatorship, into Panama's most profitable newspaper enterprise. Though Harmodio Arias was the brother of the late President Arnulfo Arias, who is the namesake of the Arnulfista Party, El Panama America and La Critica do not have a pronounced partisan alignment like most of Panama's other media. Their editorial stands, however, are generally conservative. Francisco Arias has taken over as EPASA's chief executive.

The Social Security Fund has partially frozen the assets of the daily newspaper El Universal, which has been losing money and owes the fund more than $500,000. The newspaper, which is continuing publication and looking for a way out of its hole, employs more than 200 people. Social Security director Juan Jované says that he's not interested in taking over the paper, which is subject to a Moscoso administration ban on government advertising due to its Partido Popular - PRD editorial slant, but says that the social security system needs its money. The Panama News is also in arrears to the Social Security Fund, as are nearly half of all businesses in Panama during the present economic crisis. El Universal has complained that La Prensa's coverage of its economic troubles has exaggerated the problem in an attempt to drive away advertisers. "What's at stake is whether the country will be hijacked by the opinion of just one daily," El Universal editor and publisher Carlos González de la Lastra said in a front page editorial.

The Social Security Fund has moved to take over two independent Chiriqui banana plantations, the Santa Librada and Santa Teresa farms, for debts of $70,000 and $35,000 respectively. The debts are largely the result of a worldwide drop in banana prices that have forced most producers into or to the brink of bankruptcy.

Residents of Nombre de Dios have formed a foundation to create a new museum to house the remains of a ship found in nearby waters that may be Christopher Columbus's Vizcaina. People in that community on Colon's Costa Arriba are not pleased with the possibility that the find may end up in a museum at Portobelo or elsewhere, thus depriving the hard-pressed community of tourism revenue that it wants for itself.

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