In a very rare contested election, on August 26 Rafael Stanziola ousted Juan Francisco Keiner as head of the Industrialists' Syndicate of Panama (SIP). The vote for the new head of one of Panama's more important business groups was 94-65. Stanziola put top priority on lobbying for new legislation to encourage Panamanian industrial development.

The Free Trade and Consumer Affairs Commission (CLICAC) reports that its August 26-30 survey of market prices for the "canasta basica" --- a collection of basic staple items in the typical Panamanian household budget --- shows the cost of living only went up from $211.60 to $212.04 from July to August, with meat prices up a little, fruit and vegetables down and rice holding steady. The commission discounted published reports that Panama is facing an imminent rice shortage.

According to a report in El Panama America that cites an Arden & Price Consulting study as its source, gasoline sales fell 42 percent between January and July of this year. It seems that due to the economic crisis people are driving their cars a lot less.

Former Foreign Minister Ricardo Alberto Arias has resigned as publisher of La Prensa and been replaced by Federico Humbert, hijo. Arias took control of the daily in 2001 with the support of PRD and Christian Democrat shareholders, promising to increase profits. He purged the staff of its foreigners and generally lowered salaries, but the slow advertising market did not allow his economic promises to be met. During his tenure La Prensa had to admit that it had inflated its claims about the paper's circulation, was faced with multiple copyright piracy claims and was denounced as "a shadow of its former self" by the New York-based Committee to Protect Journalists. The new pro-PRD and Christian Democrat editorial orientation was not enough, however, to prevent civil and criminal complaints against the paper's cartoonists Julio Briceño and Víctor Ramos by former Vice-President Ricardo Arias Calderón (Partido Popular, formerly the Christian Democratic Party) and former President Ernesto Pérez Balladares (PRD), respectively. Arias, a lawyer, has expressed interest in becoming one of the PRD's vice-presidential nominees in 2004.

Labor Minister J.J. Vallarino III says he'll serve as an intermediary in talks between the Puerto Armuelles Fruit Company (PAFCO, a subsidiary of Cincinnati-based Chiquita Brands) and its unionized workers. PAFCO is threatening to cease operations unless the unions give up wage, benefit and working condition concessions that they have gained through collective bargaining agreements.

After complaints by a rival bidder, the state-owned IDAAN water and sewer utility has vacated its award of the contract for improvements to the metro Panama water system to Enel.Hydro. The stated reason for the move was an allegedly falsified document certifying that it had contracted a particular expert as one of its inspectors. The contract will be the subject of at least one more round of bidding. Arcane and changing bidding procedures and weird prerequisites for submitting bids are typical in Panamanian government contracting, and are frequently used to steer government contracts toward certain companies, often for corrupt purposes.

On September 12 an 11-day construction workers' strike, which was accompanied by road blockages by sympathetic members of other unions and student militants, was settled. In a six-point accord, the government agreed to send inspectors to assure that the contractors who have the contract to build a public water treatment plant in Changuinola and their subcontractors pay back wages, contributions to the Social Security Fund and legally mandated overtime pay. Although theoretically stringent bidding procedures are sometimes defended as a way to guarantee that contractors on public works projects will meet legal obligations, in this case the state-owned IDAAN water and sewer utility's choice was cutting corners, causing the SUNTRACS construction workers' union to walk out.

At the September 11 opening of the ExpoHabitat construction trade show at ATLAPA Vice-President Arturo Vallarino was on hand to represent the Moscoso administration at the ribbon cutting, but politeness did not keep Panama Chamber of Construction (CAPAC) president Manuel González Ruiz from saying unpleasant things about the government. Arguing in his opening remarks that the current administration must bear some of the blame for Panama's weak economy, González Ruiz blasted the lack of transparency in many government contracting procedures, the absence of the rule of law and President Moscoso's failure to follow the recommendations of her own anti-corruption commission, arguing that these things prevent many private sector investments in Pamana.

The neighbors --- including the national Ombudsman's office --- are complaining about an enormous hole in ground on Calle 50 near Via Brasil, in which stagnant water has collected and mosquitoes are breeding. The site, which was supposed to be the Generali Tower, Latin America's tallest building, was abandoned by developers who allowed their consortium to go bankrupt. The limited partnership consortium's general partner, Grupo Fotokina, has likewise gone belly-up. Citibank, which has the security interest in Grupo Fotokina, says it has given title to the property to the developers, who say they don't want it and won't accept it. And thus this enormous hole continues to pose a significant public health hazard while lawyers quibble.

Architect Ignacio Mallol, whose firm did the designs for the ill-fated Generali Tower as well as some of Panama's most renowned landmarks, has announced plans for Punta Canal, a $20 million, 53-hectare medium-density residential condominium and commercial project on Cerro Farfan, near the former US Navy housing area. The project, for which groundbreaking is set to take place in January, is financed by Genoa International, Inc.

The Fitch bond rating service has lowered its rating of Panamanian government bonds from "stable" to "negative," but is sending a team of analysts here to do a more thorough review of the situation. Analysts for First Boston/Credit Suisse say that the change in Fitch's rating is based on figures from earlier this year, but opine that the market has already taken those factors into account and point to signs that Panama's economic crisis has reached its bottom.

Representatives of several companies whose shares are bought and sold on the Bolsa de Valores de Panama are opposing a National Securities Commission (CNV) proposal to require that corporate directors certify the figures that they disclose about their businesses. Representatives of several firms argue that it's the management and not the board of directors that knows the day-to-day situation of a company, while representatives from the big accounting firms say they only know what their corporate clients tell them and thus should not be responsible for the financial statements they prepare. Panama, like the United States, has seen a number of high-profile bankruptcies in which it turned out that shareholders and the public were fed false data. The public disclosure requirements for our stock and bond exchange are minimal compared with those in other countries and even then frequently ignored or circumvented, which is why the Bolsa de Valores is not taken very seriously in the world of financial markets. The CNV has been trying to improve Panama's reputation by enforcing and tightening standards and by excluding some of the more notorious crooks from the securities business here. The commission has not yet announced whether and how it will change the disclosure certification rules.

The Banking Superintendent has approved the proposed buyout of Banco Aleman Platina by Banco Continental. The deal continues a trend toward the reduction in the number of banks doing business in Panama, in some cases by foreign banks closing their branches here and in others by way or mergers and acquisitions. Panama City currently has 86 banks, down from about 120 a few years ago.

Next May Panama will host the annual gathering of Afro America 21's Caribbean Festival, a combination trade fair, private-sector development summit, cultural festival and sporting games that will attract participants from the island of the West Indies and several mainland countries with Caribbean coastlines. Afro America 21 is a coalition of some 150 groups of people of West Indian descent throughout the Americas.

Japan has pledged $3.8 million for a program to develop small-scale fishing activities along the coast of the Azuero Peninsula. The Japanese have for many years assisted Panama's fishing industry, with some notable examples being assistance to build Panama City's municipal fish market on Avenida Balboa, grants for the International Tropical Tuna Commission's research lab in El Achotines and studies about the marine environment around Coiba Island.

The Ministry of Agricultural Development (MIDA) has created an office to deal with farm affairs within the Panama Canal watershed. With the watershed's westward expansion and tentative plans to expand the Panama Canal through a series of dams and lakes that would flood many farms, the resulting land tenure and land use issues have given MIDA more work in the area.

In Panama City condominiums it is fairly notorious that when a new roof is needed, many owners will refuse to pay, saying that it's the problem of those who own apartments on the top floor. Resistance to payments for condos' common expenses will not end with a new law, but under amendments to the 1993 condiminium legislation, which were signed by the president and publiced in the Gaceta Oficial in August and will be in effect shortly, there will be no ambiguity about the speciousness of such arguments. The amendments also create an office at the Housing Ministry (MIVI) specifically to deal with condominium problems.

Grupo Bavaria, the Colombian-owned consortium that bought the Cerveceria Nacional (Cerveza Balboa, etc.) earlier this year but was turned down by CLICAC in its bid to buy Cerveceria Baru (Cerveza Soberana, etc.) and create a brewing monopoly in Panama, is now suing one of the companies it tried to buy for monopolistic practices. Part of the package with Cerveceria Nacional was the Pepsi-Cola bottling concession, while Coca-Cola Panama is part of the Cerveceria Baru family of companies. The plaintiffs allege that the defendants are offering and signing contracts with retailers by which the stores agree to sell Coca-Cola soft drink products only, to the exclusion of Pepsi. This sort of tactic in the cola wars is a very old story, but in recent years Panama has enacted anti-monopoly laws. Coca-Cola Panama may soon be purchased by South African Breweries, along with the rest of Cerveceria Baru, which will place the two beer and soft drink companies that once fielded their own political parties (Baru-Coke-JJ Vallarino-MORENA and Nacional-Pepsi-Samuel Lewis Galindo-Solidaridad) into foreign hands.

The Supreme Court has held unconstitutional a Social Security Fund regulation that denies old age or disability pension payments to persons who are gainfully employed. The court found that this conflicts with a constitutional provision that guarantees the right to work. The ruling will increase costs for the Social Security Fund, but it's not certain how much. Social Security director Juan Jované criticized the ruling because he said it will encourage people who should retire to continue working and deny jobs to younger people.

Comptroller General Alvin Weeden has nullified a contract between the city of Penonome and Guayzteca Corporation SA, by which a plant to rot garbage and collect the resulting methane gas for fuel would have been built. The neighbors hated the idea, and Weeden said that the use of sanitary wastes is the exclusive domain of the IDAAN water and sewer utility. Weeden also noted a lack of proper environmental studies and a failure to obtain various required permits.

The bidding process to privatize the ATLAPA convention center was called off when only one of three companies that qualified to bid actually submitted a bid. The Ministry of Economy and Finance and the government's IPAT tourism bureau will now try to negotiate a privatization deal without a bidding process. The government has been trying to privatize the management of ATLAPA since 1997. One of the big stumbling blocks has always been the demand that any concessionaire must pay off a lot of IPAT's workers, may of them political patronage hacks, as part of the deal.

Nestle has raised the price of its Klim and Nido baby formulas by 30 percent. The company cites an increase in the import duties imposed on milk products it imports and uses in its mixes. The government has over several administrations urged mothers to breast feed rather than use formula, so the increase is not seen as a big crisis.

A spat between Panama and Colombia that resulted in the latter's suspension of the bilateral agreement regulating Panamanian landing rights in Colombia and Colombian landing rights in Panama has been resolved by the signing of a new memorandum of understanding. COPA airlines will continue to be allowed 28 flights per week to Colombia, while Colombian airlines will be able to fly into Panama 56 times per week.

The Interoceanic Regional Authority (ARI) may hire Airco, SA, one of several companies under investigation for major overcharges for equipment and installation work at Albrook airport, to renovate Howard's air traffic control systems. ARI still hasn't decided what it wants to do with Howard, but despite the problems at Albrook Airco won a $1.197 million bid for the work at Howard. The bidding procedure may be set aside as the result of media coverage and public condemnation.

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