In a decision timed to hit the news on New Year's Eve, the Public Services Regulating Board (Ente Regulador) approved electric bill increases ranging from 3.49 to 5.45 percent. Electra Noreste's rates will rise 5.45 percent and the Spanish-based Union Fenosa's Edemet and Edechi subsidiaries are going up 4.75 percent and 3.49 percent respectively. Higher petroleum prices, due largely to instability in the Venezuelan oil industry, were cited as a key factor in the board's decision to grant the increases. The rate hike has been criticized by business leaders and in the daily newspapers. Rafael Stanziola, the president of the Panamanian Industrialists' Syndicate, told El Panama America that the increases make our electricity the sixth most expensive in the world, which he says keeps investors away from Panama.

Due to the Ente Regulador's decision to allow a collusive price structure for interconnection fees, Cable & Wireless has in effect retained its monopoly on fixed-line phone services past the date of its expiration. C&W first reached an "accord" with Galaxy, a small new company whose CEO is a relative of Cable & Wireless Panama's CEO, at rates which all of the other companies interested in providing fixed-wire services say is ruinous. Then the Public Services Regulating Board (Ente Regulador) approved this interconnection rate as the base price from which other companies would begin their negotiations with C&W. Only Telecarrier and Advance Communications agreed to an interconnection rate under these circumstances, but neither is yet ready to begin offering services because they got a late start installing their equipment. Several other companies are in appeals processes before the Ente Regulador, and probably will be in the courts after that, over the interconnection fees. Meanwhile, BellSouth is appealing the Ente Regulador's decision to bar them from using their cell phone infrastructure as the backbone of a national wireless fixed-phone network.

BellSouth has announced special low prices for international cell phone calls now that Cable & Wireless's monopoly on international telephony has ended. Calling the United States on a Bell South phone costs 5¢ per minute above the price of the local call, plus the $1 international phone call tax. Cable & Wireless has responded with a 4¢ rate.

One Panama Canal Authority employee has been fired and a company has been barred from doing further business with the canal for an alleged $33,821 overcharge and kickback scheme in purchases for the authority's Maritime Operations Department. Prosecutors have begun a criminal investigation in the matter.

On January 3 Panama City's moratorium on penalties for overdue tax payments expired, but city treasurer Ventura Vega is asking for it to be extended. The city had expected to collect about $6 million of the $100 owed to it, but only took in about $300 under the 2002 moratorium. Under consideration is a discount for those who can pay their entire past-due tax bills.

The health ministry says that six companies have qualified to submit bids to design a system of sewage treatment plants for Panama City. Bids will be opened January 27, but money to actually build the facilities is not in the 2003 budget.

Panama and Russia have signed a maritime agreement that will end the special inspections of Panamanian-flag ships calling at Russian ports. The Russians began the special checks after a scandal about the Panamanian consulate in the Philippines selling seamen's certifications to unqualified persons was publicized in the international press. The scandal has never been resolved by Panamanian authorities, which makes ships bearing this country's flag suspect to coast guards in many countries.

The Interoceanic Regional Authority (ARI) has had very little success attracting investors to the old Howard Air Force Base - Fort Kobbe - Farfan Naval Housing Complex area, and is now suggesting a special economic zone where taxes, regulations and labor laws that apply in the rest of Panama will not be enforced. The National Confederation of Labor Union Unity (CONUSI) doesn't like this idea at all, but it seems that some of the leaders of the National Council of Organized Workers (CONATO) are willing to accept the exceptions. A CONATO delegation recently visited the former US military base in Subic Bay, the Philippines, which has such a special development system in place, and came back with a favorable report. The more militant CONUSI objects to any exceptions from the protections of Panama's labor laws, and is calling on CONATO take a similar position.

The port "equalization" deal by which the Moscoso administration renounced more than $1 billion in rents, taxes, container handling fees and revenue sharing payments from the nation's privately run ports --- originally an agreement with Hutchison Whampoa subsidiary Panama Ports, which triggered contract provisions in the charters of other port companies --- is facing a second challenge before the Supreme Court. An earlier challenge by a legislator, arguing that the Cabinet Council cannot change the terms of a contract approved by the Legislative Assembly without legislative approval, was rejected by the high court last year. This challenge, brought by Administrative Prosecutor Alma Montenegro de Fletcher, challenges the constitutionality of a 1996 law which the Moscoso administration used as the basis for is "equalization" adjustment.

Panama Catholic university, the Universidad Santa Maria la Antigua (USMA), has changed from a more traditional semester schedule to a school year based on quarters. According to the APROUSMA professors' union, this cuts back on profs' vacation time and has resulted in the layoffs of five professors.

Radio Caracol, the Panamanian link in a Colombian-based and largely Spanish-owned network, has changed its format to reduce news and increase music, and that has led to the layoffs of seven journalists. Omayra De León de Watson, Israel Lizondro, Lester Burton, Alberto Pinto, Nicolás Pineda, Eduardo Iriarte and Máximo Olaya were informed on January 10 that effective immediately they were out of work. The change is a cost cutting move in a national advertising market that's about half the size that it was three years ago.

The Supreme Court has declared a garbage collection and disposal contract between the city of Santiago and the private CREDESOL waste company illegal. The 15-year contract, which was signed in 2000, was apparently never properly published and recorded. It was challenged by several local residents, and in the meantime CREDESOL has been suffering economic problems and giving service that has led to a lot of citizen complaints.

On January 5 members of SITRACHILCO, the union that represents banana workers at the Puerto Armuelles Fruit Company (PAFCO, a subsidiary of Chiquita Brands), re-elected José Morris as their secretary general. However, Chiquita's December 31 deadline for a deal that would allow them to close PAFCO and have the Panamanian government cover the expense of severance pay came and went without any agreement and it seems that talks between the union and company aren't going anywhere.