business & economy

Also in this section:
Colombia to resume restrictions on Colon Free Zone
Ocean Embassy dolphin park folks say they're misunderstood
Questions about Odebrecht autopista contract
The Panama News readership figures
Business & Economy Briefs
 

Business & Economy Briefs

ACP announces toll hike plans

The Panama Canal Authority (ACP) has announced its plans to raise tolls. The projected hike this year would be 10 percent, followed by a 17 percent rise in 2008 and a 14 percent hike in 2009. There will be a March 14 public hearing on the increase, at which shipping executives and representatives of some of the countries most dependent on the canal like Ecuador are expected to register their objections. Lee Johnson, who runs Maersk operations in Central America, summed up the reaction of many in the industry by commenting at an industry gathering that "We users know that we'll have to pay more, and thus we're looking at other alternatives to move cargo." On some routes and with some cargoes the higher Panama Canal tolls will likely drive shippers elsewhere, but for many key customers, like those who ship electronic goods from northeast Asian ports to the Gulf and east coasts of North America, our canal will still be the most economical route. During the canal expansion referendum the ACP projected a 3.5 percent per year toll increase every year for 20 years. The front-loading of the toll increases is a way for the canal to collect as much as possible before some possible alternatives like the improvement of the North American multimodal system or the construction of a South American one can be accomplished.

$200 million expansion at cement plant

The Mexican-based multinational cement giant CEMEX has announced that it's building a new kiln at its Bayano cement plant here in Panama. The improvement will cost about $200 million and be complete sometime in 2009, and will nearly quadruple the plant's capacity. Lots and lots of cement will be needed for the Panama Canal expansion project, and Panama is a good location from which to ship cement by sea to many other countries where it is needed.

Vásquez resigns second ACP job

Minister of Canal Affairs Ricaurte Vásquez will now only be collecting one paycheck from the Panama Canal Authority. He has resigned as the authority's deputy director but remains the minister and the chairman of the ACP board of directors. He told La Estrella that it's part of a planned reorganization at the authority. The propriety of whether it's OK to be the subordinate of your own subordinate and collect two paychecks for being such didn't come up.

RP asks IMO to audit its fleet

According to a Reuters news report, the International Maritime Organization, a branch of the United Nations, has announced that at Panama's request it will audit the 7,000 or so ships flying the Panamanian flag to help improve environmental and security standards. There have over the years been many incidents with unseaworthy Panamanian-flag vessels, some of which have fouled coastlines around the world with spilled oil. As a result a number of countries' coast guards and port authorities have imposed special inspections or other restriction on ships registered in Panama and the aim of the audit is to ease such measures, which can cause costly delays to shippers.

Prosecutor: bus fire victims' families have no recourse

At the insistence of officials at the National Bank of Panama who granted the loan for the Ortega Justavino brothers to buy their city bus, the men purchased a bus of Guatemalan manufacture that had no emergency escape and that used an explosive chemical in its air conditioning system. The bus owners had insurance to protect the vehicles or people with whom it may have collided, but none to protect passengers on their bus. On October 23 the air conditioning system exploded and 18 passengers who were trapped inside were burned to death. Now prosecutor Zuleika Moore has told the families of the victims that there is no law against importing exploding buses without emergency escapes, nor is it prohibited for officials of state-owned enterprises to steer purchasers toward such death traps and thus only the bus driver, its owner and a mechanic who worked on it will face any criminal or civil legal consequences for the fire. And of course, these three men are uncollectable. The Torrijos administration has reacted to the fire by cracking down on bus drivers whom it planned to put of out business anyway and carefully avoided all questions linking the scandal to the National Bank of Panama, the bus manufacturer and the Transito Authority that allowed the unsafe vehicle on the road in the first place. Part of the problem may be a hesitance to raise the issue of bus safety standards when the administration has already decided on particular manufacturers of buses with which the present owner-operated vehicles are intended to be replaced.

New taxi zone map

When there was the Canal Zone, the Panama City taxi fare maps didn't include that part of metro area. It was figured that Americans were fair game for as much as cabbies could get them to pay, and the system continued after the Canal Zone ended in 1979 because there were still a lot of Americans in the area, particularly on the military bases. But those closed years ago, and meanwhile urban sprawl has continued. So now taxi syndicates and the Transito Authority have worked together to draw a new metro taxi zone map for the first time in decades. The way it works now, the basic cab fare is a dollar and it goes up a quarter each time a zone line gets crossed. A fare increase will come with the new map, both by raising the fee for crossing each zone line to 35 cents and adding extra charges for Sundays and late at night, and also by breaking the metro area into more zones and thus putting more zone lines between many points A and B.

Traffic signal coordination delayed by complaint

A French consortium, SEMEX-Gertrude Saem, has filed a complaint against the Transito Authority, which is at the moment headed by General Noriega's old adjutant Severino Mejía, for allegedly rigging the specifications for bidding on the contract to install a computer-controlled system to coordinate Panama City's traffic lights to steer the contract to a pre-determined winner. That has put the project, which was announced when President Torrijos took office in 2004, on hold once again. El Panama America reports that it is expected that the issue will be broached at a March meeting between Torrijos and French President Jacques Chirac.

Bus drivers support urban monorail system

The National Chamber of Transportation (CANATRA), the umbrella group for most of the country's bus syndicates, has endorsed a metro area monorail system to be served by owner operated buses working feeder routes as a solution to the Panama City - San Miguelito mass transit problems. The Torrijos administration has other ideas that include specific companies that manufacture "articulated" buses and most probably a specific company to run them in an urban bus system that would put the owner-operated buses out of business.

Brits win bidding to develop Howard

London & Regional Properties, a British company, appears to have won the bidding to do the master plan to develop the former Howard Air Force Base into a duty free industrial, import/export and transportation center. The bids were opened on January 30, but the government can still reject the winner and start the process over again.

Caribbean business forum to accompany EXPOCOMER

This year's version of EXPOCOMER, Panama's main trade fair and the biggest event of the year for the Chamber of Commerce, will be accompanied by 8th Business Forum of the Greater Caribbean. Both events take place at ATLAPA from March 7 through 10. Other than the regular participation of Cuban and Puerto Rican delegations, there hasn't been a lot of Caribbean participation in the EXPOCOMER events in years past. However, Panama is increasingly if not yet fully recognizing its identity as a nation on the Caribbean littoral that has a large number of citizens with Antillean roots. We still have immigration laws that discriminate against the non-Hispanic Caribbean countries, but on the other hand Panama is now an active member of the Association of Caribbean States.

Shrimping moratorium underway

The year's first ocean shrimping moratorium began on February 1 and will last until April 11. There may or may not be a second one later in the year, depending on the state of wild shrimp stocks. The ban includes a prohibition on fishing nets with a mesh finer than 3.5 inches, which will be confiscated and destroyed if encountered by the National Maritime Service during the moratorium. The moratorium does not apply to river shrimp or those commercially raised in tanks or ponds. The sale of ocean shrimp is prohibited along with the capture while the ban is in effect.

CSS medicine shortages

Remember the Torrijos administration's promise that there would be no more medicine shortages at the Seguro Social pharmacies? Never mind. Such things as aspirin and the most common high blood pressure medications --- some 49 drugs in all --- have been unavailable from the public health care system. Critics from the labor unions and the left point to the situation as one more example that the Torrijos administration is privatizing health care as they allege and the government denies.

Resort developers fined for destroying archaeological sites

La Prensa reports that Viveros Development Inc., which is building a golf course community and marina for foreigners on Viveros Island in the Perlas Archipelago has been fined $50,000 --- a nominal amount for a project of that size --- for the destruction of eight pre-Columbian archaeological sites. The developers had earlier been fined for building without an environmental impact study or permit from the National Environmental Authority, and has been a target of criticism and lawsuits by environmentalists and historic preservationists. The company is appealing the fine because it claims that there wasn't an archaeologist readily available for it to hire to save the sites, which are of the Coclean culture and possibly others.

Panama Viejo work stopped over archaeological destruction

Work on the 29-story Icon Tower project in Panama Viejo has been halted because the apartment building construction site is atop historical ruins and the required environmental impact study has not been done. The stop work order came from the National Environmental Authority (ANAM) but the complaint that led to the action came from the National Institute of Culture's (INAC's) Office of Historical Patrimony.

English-language med school to open here

The Xavier University School of Medicine, which is located in the Caribbean island nation of Aruba, is planning to team up with the Universidad Latina to open an English-language medical school in Panama. Universidad Latina already has a health sciences program, and a press release by Xavier lauded its "state-of-art information technology and... virtual Health library with more than 60,000 journals and books." The school is recruiting for its first class, which will start this coming May.

2008 minimum wage arguments start

Under Panama's minimum wage laws, there are negotiations between labor and employer representatives for periodic changes in the minimum wage. If the two side can't agree then the president makes an adjustment by decree. The next revision of the minimum wage is due next year and heading the labor contingent is radical SUNTRACS construction workers' union leader Genaro López. The management side is proposing to tie the minimum wage to labor productivity, but López is arguing that productivity depends for the most part on the investments that business owners make in more efficient technologies. What usually happens in these talks is that both sides make strident ideological statements and in the end settle for what the market will bear, which usually has some relationship to the rate of inflation.