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Business & Economy Briefs
Old Panama Canal dredging record broken
Anatomy of a scam, Part 1
Our March web statistics
Business & Economy Briefs
Social Security amnesty doesn’t bring in much
In the first month of the two-month window of amnesty granted for those with debts to the Social Security Fund who pay the full amount of the principal that they owe, the fund only collected a little more than $2 million, according to El Panama America. The total arrears owed to Seguro are some $128 million, much of it by businesses that went bankrupt or were forced into the informal sector during the economic free-fall that prevailed during the first three years of the Moscoso administration and the generally sluggish business climate since the recession bottomed out in about the middle of 2002. There are some 15,500 businesses on Seguro’s debtor list, a select few of which have been criminally prosecuted for their debts.
Police rout banana pickets with shotguns and tear gas
On April 3 riot squads from the National Police used tear gas and birdshot to break up banana workers’ picket lines that were preventing the movement of several truckloads of fruit from farms around Divala. Workers at four banana farms are on strike for unpaid wages, but were blocking shipments from not only those farms but also three others that were not on strike. All the farms are theoretically independent, but produce for distribution through Chiquita Brands.
Competitors call for public hearing on
C&W monopolistic practices
Representatives of BellSouth, Telecarrier, Inter.Net, System One World Communications, Claro.Com, Advanced Communications, Ayaiyai.com and Tutopia have called for public hearings on what they say are Cable & Wireless’s illegal monopolistic practices. More than 15 months after the UK-based C&W’s monopoly on fixed line telephone services legally ended, the company and the Public Services Regulating Board (Ente Regulador) have teamed up to maintain the old monopoly by way of using a “sweetheart” contract between an obscure company headed by a relative of a C&W exec to set ruinous interconnection fees for phone links with the C&W system, and the government then declaring that “contract” to be the baseline that sets the price that all other companies wishing to enter the market must pay. Cable & Wireless has also been repeatedly fined for closing down connections for companies wishing to compete in the long-distance national and international calling business. The Panamanian government owns 49 percent of C&W Panama --- the local subsidiary of the British multinational --- and several government ministers and relatives of Mireya Moscoso serve or have served on its board of directors. Cable & Wireless issued a public response that accused some of the companies involved of having ulterior motives that don’t involve fixed line phone service and complained that the competition hasn’t picked up a share of maintaining unprofitable rural pay phone services.
University entrance exams indicate failing schools
After nearly five years of the Moscoso administration treating our public schools as a political patronage plum for the Rosas family, the University of Panama’s entrance exams show the result. According to El Panama America, of 17,665 youngsters who took the test, only 11,594 passed.
CAPAC complains about Tocumen remodeling specs
Tocumen Airport, which the Moscoso administration devolved to a quasi-private government-owned corporation, is planning to do a major expansion and remodeling of its terminal. However, that’s bringing protests rather than praise from Panamanian Chamber of Construction (CAPAC). It seems that Tocumen SA has written the bid requirements in a way that excludes all Panamanian companies --- in order to bid a company has to be experienced in airport terminal remodeling, and only a few companies in the world --- none of them Panamanian --- meet that standard.
Argument between Weeden and international lenders
International financial institutions are looking askance at requests to fund Panamanian government contracts that appear to be rigged to go to Mireya’s friends, and Comptroller General Alvin Weeden is accusing them of corruption. The argument goes that since international lenders prefer big multinational companies whom they know and have dealt over the obscure contractors that the current administration prefers, Panama is unfairly and corruptly the victim of an international good old boy network.
Contaminated gas warning
The Automobile Distributors Association of Panama warns that in recent weeks the mechanics at their member businesses have encountered a lot of engines that have been damaged by contaminated gasoline. No particular gas station of chain of gas stations was identified. Almost universally, sellers of contaminated gas deny it, but in many places there are government inspectors whose job is to detect and document such problems. Panama isn’t one of those places. Ramón Tapia, the director of hydrocarbons for the Ministry of Commerce and Industry, told La Prensa that the government has no legal power to investigate fuel contamination. Actually, it appears that by the letter of Panama’s consumer laws such power does exist but the Moscoso administration prefers not to exercise it.
Letter of intent to sell racetrack
The Ministry of Economy and Finance has signed a letter of intent with a Spanish and American consortium to sell the Hipodromo Presidente Remon. The Grupo Codere - Merit Management Group consortium will pay $8 million down and take over the track’s horse racing and gambling operations. The down payment represents about four month’s worth of the gross amount of wagers placed at the track.
ProFuturo - Bipan merger
The Banking Superintendent has approved the acquisition of Bipan Management Inc by Profuturo Administradora de Fondos de Pensiones y Cesantias SA, the latter one of two main companies that deal with private pension plans in this country.
BNP files insurance claim for theft by its employees
The Banco Nacional de Panama has filed a $1.654 million insurance claim with Internacional de Seguros for losses caused by an in-house embezzlement ring that allegedly involved several dozen bank employees, including several managers, and a few individuals from outside the state-owned bank.
Panama seafood scam doesn’t go over well in the USA
George W. Hood Jr., of Greenville, Mississippi and Robert Picou, a Panama native who is believed to be hiding in Panama or Nicaragua, have been indicted by a US federal grand jury for 35 counts of securities fraud, mail fraud and money laundering. The two men, who prosecutors say were part of a swindling ring with Jackson, Mississippi securities dealer Victor Nance and Memphis, Tennessee attorney Louis Hamric, allegedly conned investors into putting up some $2.5 million for a business that was supposed to fly seafood from Panama to US markets. There never were any seafood shipments. Nance and Hamric have been convicted for separate frauds.
Pet food shortages
After one animal with mad cow disease was detected in the United States, Panamanian agricultural authorities quickly imposed a ban on US beef imports. For people it hasn’t been much of a problem, as this is a beef producing country. However, the ban has included many brands of dog and cat food, which are imported into rather than processed in Panama. This has led to shortages on the pet food counters of most supermarkets. For the time being that has Leoncito, the cat who hangs out around The Panama News office, living on seafood and chicken. He doesn’t seem to be upset about it.
Duques maintain their hold on lottery ticket printing
By many accounts, renegade PRD deputy legislator Tomás Gabriel Altamirano Duque’s vote for Mireya’s high court nominees was about the lottery ticket printing contract, which has been in the Duque family’s hands for many years. On March 30 the lottery held its first bidding process for the contract in 10 years and --- surprise, surprise --- Impresora Tecnica Especializada, which is owned by the Duque family, won the bidding.
Local Xerox subsidiary sold to Guatemalans
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