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business & economy

Also in this section:
Preparing for the canal expansion announcement
Upscale water thieves?
Venezuela quits the Andean Community
Business & Economy Briefs

Business & Economy Briefs

Swiss seize teak business that Torrijos promotes

Not content with pumping the stock of a company promoted by Richard Fifer, a former Cocle governor who's facing Panamanian charges for embezzlement of public funds, it seems that President Torrijos and the first lady have now used the presidency as a stage prop to plug a teak business whose assets have been seized by Swiss authorities for alleged fraud and its CEO's past participation in other frauds and his ties with the New York-based Genovese organized crime family. The business is Prime Forestry, and according to a story on the Noriegaville website, Switzerland acted against the Zurich-based company only after the governments of Italy, the United Kingdom, France, Norway, New Zealand and Australia had either banned its activities or warned investors about them. Essentially Prime Forestry is an international boiler room operation that used various misrepresentations in the course of selling some $60 million in investments in Panamanian teak that on their faces turned out to be at most the right to grow teak on land that other people own for more than the cost of owning that land outright. So why do President and Mrs. Torrijos appear in advertisements praising Prime Forestry? For one thing, one of the directors of Prime Forestry, SA, the company's Panamanian subsidiary, is Minister of Agricultural Development Guillermo Salazar.

Legislative committee looks at Bocas

The National Assembly's Environmental Committee recently took a field trip to Bocas del Toro, after which it passed a resolution calling for an intergovernmental commission to address transportation, water quality, solid waste disposal, sewage, beach access and land tenure problems that affect the area, and to review the boundaries of Bastamientos National Marine Park with a view toward expanding them to include sensitive coral reefs that are currently unprotected. Most of the problems that the committee wants to see addressed are related to the boom in tourism and the influx of foreign residents that have characterized the Bocas islands in recent years.

Electric companies ordered to repay $29 million

The Public Services Regulating Board (Ente Regulador) has ordered Elektra Noreste and Union Fenosa to repay some $29 million in overcharges that they allegedly imposed on their customers by means of incorrect information upon which electric rates were calculated. Both companies deny any wrongdoing and have asked the Ente Regulador to reconsider. If that recourse fails, the dispute could go to the courts, and there is also a possibility that criminal charges could be filed against the companies or some of their managers. The order does not require cash rebates, but instead contemplates discounts from future electric bills.

Police record legislation on hold

For several years it has been illegal for the police to release the criminal records of individuals to people who would like to know these things about those whom they are thinking about hiring. The ban on revelation of these files was proposed by a member of the PRD caucus in the last legislature and signed by the Arnulfista president of that time, under a consensus that such records can unfairly subject a person who has paid his or her debt to society to a lifetime of discrimination. But since then there have been a number of spectacularly gruesome crimes involving people with long criminal records who were hired as security guards or household employees by those who did not know of their pasts and could not have due to the law. So Jorge Hernán Rubio, a deputy from the PRD's junior coalition partner the Partido Popular, proposed legislation repeal the ban on revealing police records and the measure passed first reading in committee. However, On April 19 the debate on the measure before the entire National Assembly was tabled because the Catholic Church's Justice and Peace Commission and other civic groups wanted to see some changes in its provisions.

La Estrella - El Siglo merger

Panama's daily newspapers will be concentrated into fewer hands with the announced acquisition of La Estrella by The Cima Group, the company that owns El Siglo. La Estrella, a broadsheet daily, is one of Latin America's oldest newspapers, having been founded in 1853. For most of its history it was owned by the Duque family, and for much of that time it published the English-language Star & Herald. However, several generations of Duques earned reputations for political treachery that was often reflected in their papers' editorial stances, and when they identified themselves with the Noriega regime in the 1980s it led to the failure of the Star & Herald and La Estrella's decline. In the late 90s there was a bitter brawl within the Duque family for control of the company, which ultimately led one faction to leave and found El Universal, which did not survive. Its last Duque publisher, a PRD legislator who broke with his party's caucus to support Mireya Moscoso's Supreme Court nominations, sold the company to a group dominated by Arnulfistas. After Martín Torrijos was elected there was another shift in ownership and editorial stance that allowed it to continue receiving government advertising. El Siglo, a sensationalist tabloid, was founded in 1985 and had an anti-PRD editorial stand until 2001, when it was bought by a group generally aligned with the PRD-Partido Popular coalition. Its editor in chief is Ebrahim Asvat, the former National Police chief who also served briefly in the Torrijos administration. This move puts the nation's seven daily newspapers into the hands of three companies, two of them aligned with the PRD-Partido Popular ruling coalition and the other owned by the descendants of President Harmodio Arias and taking a generally conservative editorial stance.

Trump to build here

Donald Trump, whose previous high-profile involvement in Panama was the holding of a Miss Universe pageant here, plans to get into the capital's real estate scene. The Trump Ocean Club, International Hotel & Tower, which has as its centerpiece an 855-foot hotel and condominium apartment building, is planned for the upscale Punta Pacifica neighborhood. The development, situated next to the Corredor Sur, is to include a dock and marina, which, given the area's tricky mud flats and rocks, would probably require either a landfill out into Panama Bay or substantial dredging. The 1.8 million square foot development, to be built according to plans by Colombian architectural firm Arias Serna y Saravia by a partnership including the Trump Organization and developer Roger Khafif's K Group.

Customs dispute with Colombia to the WTO

Panama has sued Colombia over customs duties and regulations imposed on merchandise from the Colon Free Zone. In June of last year the Colombians set special duty schedules for certain items --- including the important categories of household electronic devices, textiles and shoes --- coming from the Colon Free Zone and furthermore restricted the importation of such items to only a few ports of entry in Colombia. Since the measures were enacted Colombia's imports from the Free Zone have dropped by nearly two-thirds. Bilateral talks begun this past February failed to resolve the dispute, so Panama has filed a complaint about discriminatory practices before the World Trade Organization. The Colombian government, for its part, defends the measures on the basis of a long history of smuggling, fraudulent billing and money laundering involved in transactions between Colombia and the Free Zone.

Impasse in banana talks

Chiquita has made the COOSEMUPAR banana growers' cooperative an offer it can refuse --- or at least, did refuse. The insolvent co-op, formed when Chiquita spun off its Puerto Armuelles Fruit Company subsidiary, has an exclusive marketing agreement with Chiquita that obliges it to sell fruit at well below world market prices. The Panamanian government has been subsidizing COOSEMUPAR and, according to the http://www.freshplaza.com website Chiquita was offering a $3 million payment and demanding more public subsidies and guarantees of no further demands in return, while refusing to budge on the marketing arrangement. The cooperative is sticking to its demand for the right to sell its produce to other buyers.

Progress in trade talks with Hondurans

On April 21 a new round of trade talks between Panama and Honduras was concluded without reaching the goal of a free trade pact, but with both sides saying that progress had been made. Agreement was reached on such key issues as definitions about the country of origin of products and the identification of rice and sugar as commodities that each country will be allowed to protect. There are still a number of sensitive products that one country or the other wants to be able to protect whose status is yet to be agreed. In general the Panamanians are looking to sell more services, particularly financial services, in Honduras, while the Hondurans want to sell more manufactured items here. Agriculture has tended to be a stumbling block because the two countries produce similar things.

Canal Once back on the air?

Panama's state-owned educational television station, Canal Once, has for some time been mainly available to those who use MEDCOM's Cable Onda cable TV system. Its broadcast signals, theoretically with a nationwide reach, don't even come it at The Panama News office, which is about a mile from the station's main broadcast tower. However, that may change soon because the Cabinet Council has approved a $2,035,300 contract with Btesa America SA to rehabilitate the network's transmission facilities. Canal Once, which once belonged to the University of Panama, has largely become a propaganda outlet and a bowl of political patronage plums for successive national administrations. In the Moscoso administration's division of spoils it was given to the Rosas family and was severely looted of funds and equipment. After the Torrijos administration took office the former director fled to Costa Rica and asked for political asylum, which was denied.

Bocas power outage due to cable theft

On April 13 residents in the Bocas del Toro corregimientos of Las Tablas and Guabito went without electricity for several hours. The reason? Maleantes stole 1.2 kilometers of the copper wire that brought these areas power from the Bocas Fruit Company plant in Changuinola. So far no suspects have been apprehended. Panama has seen its long standing problem with thefts of utility cables become much worse lately, largely because increased demand in China has raised world prices for scrap metal. Every once in awhile some individual thief gets caught in the act, but the intermediaries who deal in stolen metal are almost never sought, arrested or prosecuted, even though it's a big business.

Panama Canal expansion update

Also in this section:
Preparing for the canal expansion announcement
Upscale water thieves?
Venezuela quits the Andean Community
Business & Economy Briefs