José Miguel Alemán's economic proposals

On August 27 Arnulfista Party presidential candidate José Miguel Alemán spoke to the Panamanian Business Executives Association (APEDE) about the economic policies that he would promote if he is elected next year. Alemán is running a distant third in the polls and was picked by and is closely identified with an unpopular president, but there is plenty of time between now and next May’s elections for the presidential race to change.

Alemán began with a one-sentence summary of his general economic goal: “I want everyone in Panama to have a better income.”

Though he didn’t claim that the Moscoso administration has accomplished that, the Arnulfista candidate did point to United Nations development statistics that indicate that Panama’s standard of living improved between 1989 (the disastrous final year of the Noriega era) and 2002 (the third full year of the Moscoso administration).

The former foreign minister highlighted the problem of rural poverty, and said that if he becomes president he’ll make sure that everyone will have access to a health care facility, every community will have a decent school and that electricity, clean water, proper housing and roads will be available to all.

Most of the voters are in the cities, however, and Alemán acknowledged their preoccupation. “The major concern of Panamanians, by far, is unemployment.” To address this problem, which according to official measures hasn’t dipped below 13 percent in many years and according to most economists is and has been even higher than the successive governments have been willing to admit, Alemán offers a six-point plan.

First, he wants to develop education. “How many brains are working behind machetes because there was no other opportunity” he asked. Alemán would extend eligibility for the school nutrition program from its present 12-year-old cutoff through the age of 15. He would bring electricity and computers to all rural schools that lack these amenities. He would carry out the promise made in legislation proposed by National Liberal legislator Arturo Araúz and signed by President Moscoso to extend the teaching of English to all levels of the educational system, so that kids would have a chance in the growing tourism and computer technology sectors. He would use the Internet to redress the shortage of educational materials. On the secondary level, he would emphasize technical education. He would promote sports as a national educational policy.

Alemán’s second point of emphasis is in the field of agriculture. First, he vowed to maintain food import duties at the maximum levels allowed by the World Trade Organization and criticized the Pérez Balladares administration for “unilaterally disarming” our farm sector by lowering or eliminating protective tariffs to a greater extent than was legally required. He wants to build more irrigation projects, make more credit available through the Banco de Desarrollo Agropecuario, maintain a seat for agricultural interests in all international economic negotiations, improve rural roads and develop a national network of farmers’ markets. He said that he would emphasize exports through a stronger marketing effort and otherwise, and pointed to recent increases in pineapple and chicken exports as the sorts of Moscoso administation successes on which he’d like to build.

The third point in Alemán’s economic program is tourism. Citing statistics for the numbers of visitors, especially in the cruise ship category, he hailed the Moscoso administration’s successes. He also said that President Moscoso is making good progress in negotiating an exception to the Jones Act that would allow even more US cruise ships to call at Panama. He expects the new Museum of Biodiversity at Amador to become a major tourist attraction. He noted the ancillary economic benefits to bus drivers, farmers and others that have come with the success of the Decameron resort hotel in Farallon and said that further tourism development along the beaches between Gorgona and Anton would be a priority if he becomes president. On the Atlantic side, he’d promote tourism by improving the coastal roads in Colon province, supporting the Devil’s Beach hotel and Fort Sherman marina developments and building a new bridge over the canal near the Gatun Locks. He’d create a techical institute to teach tourism industry skills and maintain the current $10 million annual budget to promote Panama as a tourist destination.

Fourth, Alemán would encourage small and micro businesses. He would do so through training programs and the extension of credit through the National Bank of Panama.

Fifth, the Arnulfista candidate would encourage the further development of international phone calling centers like the one recently opened by the Dell computer company.

The sixth and final point --- and surely the most costly and ambition part --- of Alemán’s economic action plan is infrastructure development. He’s for the modernization of the Panama Canal. He wants a second major Pacific seaport. Calling Colon’s dependence on a Trans-Isthmian Highway that dates back to World War II “a disgrace,” he promised that he’d widen the road between Colon and Panama to four lanes along its entire route. He again noted his intention to build an Atlantic side bridge over the canal, pointing out that this would not only promote tourism development, but also give Costa Abajo farmers new market opportunities. He said he’d build the sewers and wastewater treatment plants needed to clean Panama Bay.

On othe matters, Alemán promised not to privatize Seguro Social, said he’d continue the government-business-labor dialogues over its management and do something to ease investment restrictions that effectively limits the Social Security Fund to one percent interest income on the billion dollars it has on deposit at the National Bank of Panama.

The Arnulfista candidate said that he’d break with the past and lower unemployment below the persistent 13 percent floor.

Alemán says he’s for constitutional reforms, especially in the judicial and legislative sectors, but didn’t talk about the specifics or the means of accomplishing them.

He promised a more transparent government. “Everything should be on the Internet so that journalists can easily do their jobs,” he said.

In the area of public transportation, Alemán said that bus service to the Interior is generally pretty good but that metropolitan transportation is a problem. He promised that those who now make their livings in the sector will have places in a transformed urban transit system. “I don’t want to take bread from anyone,” Alemán said as part of a thinly-veiled blast against Guillermo Endara’s proposal for a radical restructuring of urban transportation. The Arnulfista candidate also promised new bus terminals for Colon, Panama Oeste and Panama Este.

On the issue of public safety, Alemán’s for longer prison terms for violent offenders and more educational programs to give inmates a better chance to do something useful and legal with their lives once they leave prison.

In general Alemán said that he’s govern by consensus and dialogue, avoiding economic “shock treatments” like the labor law changes of the Pérez Balladares administration and gradually preparing the country to compete in a globalized free market.

In the question-and-answer period after Alemán’s main presentation, APEDE president John Bennett noted two problems and queried the candidate about his ideas on the subjects.

First, Bennett noted the decline of domestic aviation, particularly in air service between the capital and Chiriqui. Alemán said that he supports COPA airlines and is open to suggestions.

Second, Bennett noted the size of government, particularly the growing number of people on a public payroll that accounts for some 90 percent of the national budget, and wanted to know what Alemán might do to address the situation. “We’re jealous of public resources,” the Arnulfista candidate responded, adding that he would run an efficient operation.

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Alemán's economic platform
The problem with investing the Social Security Fund
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Alemán’s economic plan for the next five years