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business & economy

Also in this section:
Central American free trade talks to start again
Electric bills going up
Third US mad cow case hasn't prompted the RP reactions that prior ones did
Business & Economy Briefs

Business & Economy Briefs

RP-Cuba trade talks

On March 18 a Panamanian delegation headed by Vice President and Foreign Minister Samuel Lewis Navarro paid a visit to Cuba's Ministry of Foreign Trade in Havana to talk about stronger economic ties between the two nations. Cuba in part gets around the US trade embargo by purchasing things in the Colon Free Zone, but this has meant that the Cubans run a large trade deficit with us, buying a lot more than they sell. The Castro administration wants to change this negative balance by boosting Cuban sales to Panama, particularly in the service sector and also by using the Free Zone as a warehousing and wholesaling center for Cuban goods. Cuba has to date mainly exported cigars, alcoholic beverages, music recordings, pharmaceuticals and medical equipment to Panama, and has provided mainly health care, educational and sports training services to this country.

Banana strikers win subsidy

As a means to pressure the government to pull them out of a deep financial hole, starting on March 16 members of the COOSEMUPAR banana cooperative closed the Paso Canoa border crossing into Costa Rica for 59 hours until the Cabinet Council approved an $850,000 subsidy. Earlier the government appointed a commission to review the terms of a contract by which a Chiquita Brands subsidiary devolved its Puerto Armuelles plantations to the co-op subject to a contract by which Chiquita would be the exclusive buyer of the fruit. The company is paying well below market prices and the co-op is insolvent. That's a problem for the Panamanian government not only because of the social problems it causes in Chiriqui's banana growing regions, but because the state is the co-op's biggest creditor.

EXPOCOMER claims big jump in transactions

The Chamber of Commerce has announced that at this year's the EXPOCOMER trade far transactions worth some $125 million were made, an increase of $25 million over last year's figures. This year 452 sellers exhibited their wares to buyers from 32 countries, the chamber said.

Back to school

The twice a day school bus parades are once again taking place on the street where The Panama News office is located, the juvenile unit of the National Police is again watching bus stops near Artes y Oficios and some 30,000 new students have begun classes at the University of Panama. The 2006 school year is underway, with fewer problems than has been the case in recent years. A few rural schools delayed their openings because teachers hadn't been appointed, and a number of classes in schools that did open were awaiting teachers to be assigned, even as there were huge lines of teachers seeking work at Ministry of Education offices. A few schools couldn't open because repairs were still underway. However, all through the Moscoso administration and for the first two years under Torrijos those problem were much more severe. The school year began with a number of kids being excluded from classes for wearing their hair in banned styles, most of them more common among black people, such as corn rows, dreadlocks or short with designs razored in. The government appealed to teachers and students to avoid strikes like the ones that plagued the 2005 school year and led to a higher than usual failure rate.

Carnival Commission established

It appears that we won't have a repeat of the government's IPAT tourism bureau's estrangement from Panama City's Carnival celebrations next year, but whether IPAT will make much of an effort to encourage foreigners to come here for Carnival in general is still to be seen. On March 14 President Torrijos issued a decree creating a Panama City Carnival Commission, to be headed by Mingthoy Giro as was the 2006 organization, but also including representatives of IPAT, the municipal government and private businesses. Commission members include Giro, Tourism Minister Rubén Blades, the mayor's representative Iván Arrocha, the city council's representative Carlos Pérez and businessmen Bruno Tamburelli and Domínguez. This commission will serve through the Carnival of 2009, allowing some longer range planning.

Finning banned in RP waters

President Torrijos has signed legislation to prohibit the practice of finning sharks --- catching the fish, cutting off the fins to sell for use in Chinese soup, and throwing the rest of the fish away --- in Panamanian waters. While people who are overly impressed by old Steven Spielberg movies might think it's a good thing to drive sharks to the border of extinction, actually it harms the marine environment by making schools of fish upon which sharks normally feed more vulnerable to diseases. In a marine food chain with a healthy balance, the predators remove the sick and injured fish which otherwise might spread diseases among their schools. On hand for the signing ceremony was French environmentalist Alexandra Cousteau, the granddaughter of scuba developer and underwater explorer Jacques Cousteau. It will still be legal to catch sharks, whose meat is edible if not the most popular choice, but woe to owner of the fishing boat which the National Maritime Service stops and finds to be in possession of shark fins but not the rest of the fish.

CARICOM again objects to nuke shipments

Another highly radioactive cargo is headed this way, and the Caribbean Community of nations is renewing its protest against such shipments. On March 14 in Port-of-Spain, Trinidad-Tobago, CARICOM's secretary general, Prime Minister Patrick Manning, said that the organization "wishes to reiterate that any accidental or deliberate spill of nuclear or toxic waste in the Caribbean Sea could pose a serious threat to the economies of the region and is concerned that despite its repeated opposition to the shipments, the practice continues.” The occasion for the remark was an imminent shipment of nuclear reactor waste from France to Japan via the Panama Canal. In Japan the waste is processed into plutonium pellets, which are then used as fuel in other reactors and sometimes shipped to Europe via our canal. The Panamanian government and the Panama Canal Authority have supported such shipments, alleging that the treaty-mandated neutrality of our waterway obliges us to accept them. That interpretation of international law is hotly disputed within the Panamanian legal profession, by environmentalists worldwide and by virtually all of our Caribbean neighbors.

Regional water tribunal upholds challenge to nuke ships

On March 14 the new Latin American Water Tribunal held a hearing on a lawsuit brought by a coalition of environmentalist, civic and labor organizations, against the Panamanian government  The plaintiffs included the Panamanian Ecologist Association, the United Civic Associations (ACU), the Popular Legal Assistance Center (CEALP), the Panamanian Center for Social Studies and Action (CEASPA), the Panamanian Human Rights Committee (CPDH), the National Confederation of Organized Workers (CONATO), Defensa Ambiental, the Foundation for the Development of Citizens Liberties and the Foundation for the Wholesome Development of Cerro Punta (FUNDICCEP). The Panamanian government did not participate in the hearing or respond to the suit in any way. The lawsuit is based on claims that the passage of highly radioactive cargoes through the Panama Canal endangers the supply of potable water to most Panamanians, violates a number of maritime, environmental and human rights treaties to which Panama is a party and conflicts with this country's constitution and laws. On March 21 the tribunal issued a ruling upholding these claims. However, even though Panama is by treaty subject to the panel's decisions they are treated as advisory only by this country's government.

SUNTRACS leaders re-elected

Genaro López will get another two years as leader of the militant SUNTRACS construction workers' union. It was the ninth such election that he has won. The secretary general, who has said that he tries to be "a good communist," faced opposition but won in an overwhelming landslide despite setbacks in last year's struggle against Seguro Social reforms. Also re-elected were the union's number two leader Saúl Méndez and the incumbent slate of directors. Last year's month-long strike against the Torrijos administration's social security changes, which ultimately forced a few concessions but failed to stop some cutbacks in benefits and the partial privatization of the Social Security Fund's management, left López as Panama's most prominent labor leader and gained him the respect and support of a lot of people who do not share his leftist political views.

Banco DISA fraud trial put off again

On March 14 the fraud trial of three former directors of the failed Banco DISA got underway --- but just briefly. Joaquín José Vallarino, Rafael Endara Jiménez and Jorge Eduardo Endara Paniza was scheduled for that morning but the attorney for one of the accused presented the judge with a doctor's note claiming that her client was ill and the hearing was put of without a new date being announced. There have been multiple civil and criminal cases arising from the collapse of the successor enterprise Desarrollo Internacional, SA, a company originally founded on US loan guarantees granted largely on the strength of Vallarino having at the time held the Coca-Cola bottling franchise here. Food wholesaler Haralambos Tzanetatos has brought the fraud charges in this particular case, alleging that the accused cheated him of $10 million. He won the case in a separate civil action, which was appealed. Among the criminal actions involved have been a criminal defamation charge brought by Vallarino. The bank collapsed not long after it was revealed that it had been financing a pyramid scheme, but Vallarino has always protested that it was never insolvent and that the Banking Superintendent acted improperly in shutting it down. There is no bank deposit insurance in Panama, and it appears that when all the litigation is done and the lawyers have been paid, depositors will get about 70 cents on the dollar for their deposits.

Changes in government contracting on the way

As part of the process of negotiating a free trade deal with the United States, it has been evident for some time that Panama would have to reform its public contracting system to get a deal with the Americans. The days of rebidding eight times for a government contract until the "right" bidder wins would have to end in any deal which the United States would accept. But regardless of what any possible agreement might provide, the Torrijos administration is changing the public contracting rules in advance. The Cabinet Council has come up with a draft of a public contracting reform law that would among other things require the government to publish bids on the Internet and create a new tribunal for quicker resolution of grievances over public contracts and concessions. It does not appear, however, that the most frequent form of bid rigging, the writing of specifications that only one person or company can meet, would be affected by the reforms. However, some of the restrictions that have up to now prevented small businesses from bidding for government contracts will be eased. The administration is taking the draft around to business groups for comments and may make adjustments before sending a formal proposal to the National Assembly.

Indian company gets big break here

Infosys Technologies, a software company from India, got its biggest break so far in the Latin American market by signing a $20 million contract with Banco Continental to install and maintain its Finacle operating specialized operating systems and programs for banking computers, customer service call centers and Internet commerce.

Lottery sold more tickets in 2005

According to a report in El Panama America, the national lottery sold some $360 million in tickets in 2005, some $10 million more than the previous year. From that gross the lottery paid some $64 million into government coffers.

Panama Maritime Authority hires Spanish consultant

The Panama Maritime Authority (AMP) has hired Spanish consulting firm Grupo Soluziona to do a $300,000 study about ways to strengthen the institution, which was created during the Pérez Balladares administration and was plagued by scandals during that and the succeeding Moscoso presidencies. The Spanish government is picking up the tab for the study.

Vietnamese to help RP establish acupuncture center

Acupuncture has been part of the Panamanian health care scene for some time, mainly by way of doctors trained in Taiwan or China and practicing mainly in Panama City. Now it's becoming more likely that our acupuncturists will be trained here. Nguyen Tai Thu, the director of Viet Nam's Central Acupuncture Hospital, recently came to Panama and signed a memorandum of understanding with the Ministry of Health, whereby the Vietnamese will open an acupuncture clinic that will gradually expand to become an acupuncture institute. The traditional Asian therapy, in which thin needles are inserted at key points in the body, is used as a form of anesthesia, for the treatment of addicts' cravings and for other medical conditions. It is based not on Western science but on an ancient theory of the flow of "qi" through the body. However, acupunctures efficacy has been verified using scientific methods generally accepted in the West, regardless of the lack of an agreed way to detect and measure qi.

Also in this section:
Central American free trade talks to start again
Electric bills going up
Third US mad cow case hasn't prompted the RP reactions that prior ones did
Business & Economy Briefs