business

With a few weeks left in the fiscal year that ends on September 30, the Panama Canal has broken the $1 billion barrier in annual ship toll revenues, the first time it has done so. It seems that the gradual recovery of the South American economy, which has increased the number of large container ships traveling between Asia and the Atlantic side of South America, is the main factor behind the increased traffic and tolls.

In one of his first acts as the director of the Panama Maritime Authority (AMP), Second Vice-President Rubén Arosemena has cancelled his predecessor Bertilda García Escalona’s grant of a monopoly on approval of ship security plans to an obscure Florida company. Actually, García Escalona had as the July 1 implementation deadline approached also authorized two other companies, one in Singapore and one in London, to review security plans, but as a practical matter the Florida company retained a near-monopoly. The cost of security certification for Panamanian-flag vessels was driven substantially higher by the Mireyista regime’s policy, which drew criticism not only from shipowners but from the principal author of the ISPS code itself. Now the world’s 16 principal ship inspection agencies will be allowed to both review ship security plans and do the inspections to ensure that these plans are implemented.

Fish meal executive George Novey, who is also said to be a sports fishing advocate, has been named as the Panama Maritime Authority’s (AMP’s) director of marine and fisheries resources, replacing Arnulfo Franco. The AMP has been severely criticized for selling too many commercial fishing licenses to foreign vessels, and the first reactions to Novey’s appointment from the national fisheries sector have been positive.

The Colombian government has banned the import of items from Panama except for those coming through the port of Cartagena and those arriving at Bogota’s El Dorado Airport. The resriction, described by the Colombians as an anti-smuggling measure, took effect on September 20 and is a matter of concern to both Colon Free Zone merchants and to small-time exporters of coconuts, seafood and produce from Kuna Yala to Colombia.

Having had its approval of an electricity rate hike effective this past July 1 voided by the Supreme Court for violating public notice and hearing requirements, the Public Services Regulating Board (Ente Regulador) is planning to start the process over again. The move to legalize the voided rate hike will begin with an October 15 public hearing, according to El Panama America.

A few weeks before they left office, Mireya Moscoso and her cabinet approved a concession to let a local subsidiary of CODERE, a Spanish gambling company, take over the management of the state-owned José Remón Hippodrome. Now one of the executives and leading shareholders of CODERE, Joaquín Franco Pérez --- the grandson of Spain’s late dictator Francisco Franco --- has been arrested in the state of Arizona for allegedly skimming proceeds of a gambling operation, falsifying business records and trying to bribe a state gaming commission employee. The local subsidiary, Empresa Hipica de Panama SA, also obtained bingo, slot machine and sports betting licenses from the Moscoso administration. So far the new administration has taken no action with regard to the company, or for that matter the case of Betpanam, a Panama-based online betting operation that went out of business earlier this year owing more than half a million dollars to bettors.

By law, the Interoceanic Regional Authority (ARI), which was created to handle the assets Panama received under the 1977 Carter-Torrijos Treaties, is set to go out of business next year. However, its life may be extended by legislation. Meanwhile, whether it’s for five-year terms or for less than one year, economist Julio Ross Anguizola has been named as the new ARI director and engineer Olmedo Alfaro has been appointed as the new deputy director.

At the moment it doesn’t matter, because the second bridge over the Panama Canal is not connected to any roads that are open to the public. Also, depending on studies by the Ministry of Public Works and the Panamanian Society of Engineers and Architects of the bridge’s structural soundness, all questions could be rendered moot. However, presuming that the bridge can be safely used and is eventually connected to roads that people can use, there is another problem. Mireya had decorative lighting installed on the bridge, but not the kinds of lights that are needed for night driving or crossing the bridge when it is shrouded in fog. The post-inauguration cost overrun is but one more bill that was left for the new administration to pay.

COPA Airlines has ordered four new Boeing 737 jets --- which will increase the size of its fleet to 25 planes --- and plans to add new flights to Buenos Aires and São Paulo early next year. COPA is mostly Panamanian-owned (by members of the Motta family), but US-based Continental Airlines holds a 49 percent stake in the company.

Ricardo Martinelli’s supermarket empire is expanding and the Mangravita family’s is contracting. The Casa de la Carne stores on Tumba Muerto and in Los Pueblos are being sold to Super 99, and Casa de la Carne is reducing its labor force by about 100 people as part of the move.

On her penultimate day as president, Mireya Moscoso inaugurated a kidney dialysis clinic in Chitre, which she named after her mother. It would be the only such facility in the Azuero Peninsula, where there are about 45 patients suffering from chronic kidney failure who need to have their blood filtered twice a week in order to live. The clinic, however, was not ready for business when inaugurated. It needs equipment, and according to La Prensa the prior administration had put in a no-bid $900,000 order with Ultramed Corp SA for NIPRO brand dialysis machines. The Social Security Fund, however, has determined that NIPRO machines are of low quality, and thus the new Minister of Health Camilo Alleyne has decided to put that contract on hold and review the situation. The clinic was also unready to begin work when Mireya dedicated it because no nephrologist (physician who specializes in kidney problems) had been assigned to it. While the ministry is sorting out the various problems and questions, patients in the Azuero will continue to travel to Aguadulce for their treatments.

The Ministry of Agricultural Development is warning that the S. spinki rice mite is infesting rice fields all over the country, having spread from El Caño in Cocle province where it was first detected a year ago. The mites, which are invisible to the naked eye, spread a fungus, Sarocladium oryzae, which shows up as a reddish rust on the rice plants. Both the mites and the fungi are immune to all known pesticides.. Between the S. spinki and the infection they carry, the damage done to a rice crop can amount to a 40 percent reduction in the yield. S. spinki have a life cycle of 15 days, and one suggested measure to fight the blight is a moratorium of about one month in which all Panamanian rice fields would have to remain fallow, denying the mites a host upon which to live and reproduce. That would entail substantial financial losses to the nation’s rice growers, but then so does this blight.



Also in this section:
Business & Economy Briefs
Blades at AMCHAM
Torrijos planning austerity measures
The problems with the Albrook-Balboa overpass
Luciani tapped to head Seguro Social

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