Business & Economy Briefs

Torrijos signs island and beach concession law

On January 7 President Torrijos signed the controversial Law 132, now dubbed Law 2 of January 7, 2006. The statute allows for the sale of private concessions on islands and beaches in declared tourism zones, notwithstanding constitutional provisions that Panamanian beaches are public property. It also strips the National Environmental Authority of its role in evaluating tourism developments on beaches and islands and assigns the task of doing environmental impact studies to consultants hired by developers and analysis of these to the Ministry of Economy and Finance. In a broadcast statement he said that the law will allow for more investment in Bocas del Toro tourism. A coalition of environmentalist groups says it will sue to overturn the law on a variety of constitutional grounds.

Lead foundry closed by health officials

PAMETSA, an American-owned foundry that has for a number of years operated a car battery recycling business in Panama City’s Pedregalito neighborhood, has been closed after tests revealed that several dozen people who live nearby have unusually high concentrations of lead in their blood. The company had been working with an expired health permit, which gave officials an excuse to act, but had over the years passed inspections. Panama’s standards about lead emissions from industries are relatively lax, and the subject is difficult to define in any case. Lead is a cumulative toxin that can be dangerous when there has been long term exposure to tiny amounts, and because the bodies of children absorb more lead that is ingested than the bodies of adults do and the metal causes learning disabilities, it’s hard to set a meaningful emissions standard. Plus it would be unlikely that the foundry would be the source of all of the neighbors’ lead exposure: people can get it their drinking water from solder in pipe connections, from breathing automotive exhausts (though not as much since leaded gasoline was banned here a few years ago), from lead-based paints and from diverse other exposures. No charges have been filed against PAMETSA’s owners, but it’s a reasonable bet that the company won’t be allowed to resume operations in an area where there are people living nearby.

Casco Viejo vendors reprieved

The city had decided to enforce a 2004 executive decree banning vendors from the Paseo Esteban Huertas, which runs along the sea wall above Plaza Francia in the Casco Viejo. But attorneys for the 20 or so vendors, many of whom are artists or craftspeople who have been selling their wares in that location for many years, attacked the order that their clients cease and desist as of January 1, citing a 1997 law that guarantees the right of artisans to sell their work anywhere in Panama. Round one of the legal battle went to the vendors, when a circuit judge agreed to hear their challenge to the ouster order and granted a stay of execution.

Five years between textbook updates

In the waning hours of the 2005 legislative session the National Assembly approved legislation on school textbooks. The most controversial part of the proposal, which would have required all texts to be written by Panamanian authors, was amended under strong public criticism (particularly from business groups) so that foreign books may also be used here. An approved book would be authorized for five years, but reviewed after three years. This reform was prompted by parents’ complaints that certain texts would be issued in a slightly different version each year, so that there was no possibility of buying lower-priced used books. The five year term of texts would also correspond to Panama’s political cycles, as particularly in social studies it’s common for each government to put its own ideological stamp on the things that kids are taught in school. The Ministry of Education will be publishing their official list of authorized textbooks at www.meduc.gob.pa.

50 University of Panama profs involuntarily retired

The University of Panama has announced that it will not continue some 50 professors who will turn 75 in 2006, due to the “Faundes Law” that prohibits people over the age of 75 from holding most public jobs. The University Professors Association of Panama (APUDEP), which represents much of the faculty, supports the move as a means to allow younger profs to be promoted.

Agricultural and fishery export subsidies

For 2006 only the government has approved tax exemption certificates (CATs, by their Spanish initials) for producers of such non-traditional agricultural exports melons, papayas, squashes and tubers and for seafood exporters. The CAT program has been existed since 1974, but has been cut back in recent years due to various abuses and because the government has been trying to collect more tax revenue. Access to the Panamanian market for subsidized US agricultural products is a key sticking point in US-RP free trade talks, so this policy may be a bargaining chip in those negotiations or a concession to farmers who may not like an eventual agreement.

Puerto Armuelles may get Oxy refinery

The Ministry of Commerce and Industry and Occidental Midstream Projects (a subsidiary of Occidental Petroleum) have signed a memorandum of understanding to begin feasibility studies about an oil refinery in economically depressed Puerto Armuelles. If things work out it would mean a $3 billion project, with about 10 times the productive capacity of the old refinery in Colon, which closed in 2002. Puerto Armuelles is well situated because it’s the Pacific terminal of the oil pipeline that runs from Chiriqui Grande in Bocas del Toro province, an facility slated to be upgraded in order to handle Venezuelan oil exports to China. Mexico is also looking to build a new refinery in order to serve the needs of the Meso-American Isthmus and the Torrijos administration is hoping to land that facility for Panama as well. Panama produces no oil and only a little natural gas, but there may be some offshore petroleum under the seabed of our eastern Caribbean territorial waters.

BLADEX pays dividend

BLADEX --- the Banco Latinoamericano de Exportaciones SA --- which was the first Panamanian business to trade shares on the New York Stock Exchange, has declared a quarterly cash dividend of 15 cents per share. The bank was founded by nearly two dozen state-owned financial institutions around Latin America and the Caribbean, and over the years has picked up a number of private shareholders. Relatively transparent and conservatively run, the bank’s performance is usually a good indicator of the health of the regional economy, which on the whole seems to be picking up of late.

Albrook overpass still sinking

Earlier estimates that extra shoring up of the soil under the Albrook overpass had solved the problems that have kept the structure from being opened for traffic seem to have been wrong. El Panama America, citing the Ministry of Public Works, reports that the bridge structure, which was built over an old mangrove swamp that was filled in under American guidance in the early part of the 20th century, is still sinking. Now the ministry is saying that another $2 million worth of remedial work is needed.

Marta Matamoros, a former needle trades union leader who was at the head of the fight for maternity benefits for Panamanian workers, died on December 28. She was 96 years old. A member of the old Partido del Pueblo, Panama’s now moribund but formerly stronger orthodox communist party, she was one of the leftists whom General Omar Torrijos attracted into his political camp.