business & economy

Also in this section:
Doctors' strike prolonged
Mark Boswell's alias Rex Freeman's Costa Rica office raided
Business & Economy Briefs

Business & Economy Briefs

Foreigners' driver license renewals at Multicentro

Belatedly, a chaotic driver license renewal process has been amended to plug one of its gaping holes, the lack of provisions for the issuance of the new, theoretically harder to falsify, licenses to foreign resident drivers. The office for the Panama metro area is in the Multicentro shopping mall on Avenida Balboa in Panama City. After initial reports of long delays and much confusion, most reports are that the process is now going relatively smoothly. The prior "deadline," for which no provisions were made for most non-citizens, was the end of October, but it has apparently been extended to the end of November. Only resident foreigners can get licenses --- those here on tourist visas are not allowed to get Panamanian licenses but can drive on their foreign licenses for up to 90 days. Meanwhile, those who are required to take driver education may do so at the Universidad Especializada de las Americas in Clayton --- the president's aunt's school.

Tax receipts up

Less unemployment, more inflation --- it adds up to a 22.6 percent increase in the national government's tax receipts from January through October of 2007 as compared with the same period in 2006. All told, reports the Direccion General de Ingresos, $1.699 billion came into the tax coffers, much more than had been projected in the budget.

Highest inflation growth in 14 years

The Comptroller General's office reports that in October prices were 5.5 percent higher than in the same month of 2006, and a half a percentage point higher than the month before. This would be the biggest officially recorded increase in inflation since the nation's economy rebounded from the effects of the 1989 US invasion and preceding years of economic sanctions in the early 90s. Higher costs of fuel and housing, plus a US dollar that's weak against other major currencies, are factors driving the inflation rate.

$3.20 for 91 octane gas

Gasoline prices are up again, this time up to $3.50 per gallon for 95 octane premium and $3.20 for 91 octane regular. It's driving the price of just about everything else up, and we're getting warnings from the president of Venezuela that if the United States attacks Iran as propaganda coming out of Washington suggests it might, the prices of petroleum products may spike to double what they are now.

Corredor Sur tolls up, more than ICA said

The Torrijos administration has granted the Mexican company ICA a toll increase on the Corredor Sur, after that company said it was losing money. The hike was billed as 10 percent, but when it went into effect ordinary commuters found that it's closer to 20 percent for them, with smaller increases for heavy trucks. Critics complain that the government accepted ICA's argument based only upon numbers from the toll road, which has increased costs due to shoddy construction and use of improper materials by ICA and which leaves other compensation the company received for the toll road project --- most notably the former Paitilla airport that has been developed into Punta Pacifica --- out of the profit and loss calculation.

Carlos Slim wins canal dig bidding

The second bidding contest for part of the canal expansion digging, this part also on the Pacific side like the first part, has been won by Consorcio Cilsa Minera Maria, a company headed by Mexican billionaire Carlos Slim. The Panama Canal Authority (ACP) can either accept the offer or start the bidding process again.

Four consortia want to design and build locks

Four international groups that include more than 30 companies, including most of the world's major construction companies, are reportedly in the running for contracts to design and build the new locks for the expanded canal. This will not be an ordinary bidding process for a job with set specifications, but a matter of the ACP deciding which groups have the best teams and the best offers. It's a big engineering problem, because there has never been a three-step set of locks with water saving basins of the height and size contemplated here, and it's alreadly known that in Europe the currents caused by much smaller locks of this type cause an increase in accidents in the locks chambers.

ANAM approves canal expansion

On November 12 the National Environmental Authority (ANAM) approved an environmental impact study --- based on incomplete plans and with technical studies still undone --- for the Panama Canal expansion. Work officially began on the project on September 3, but ANAM now routinely allows work to begin on projects without prior approval of environmental impact studies, if the political connections are right.

Proctor & Gamble regional HQ here

Proctor & Gamble is moving its Latin American headquarters from Caracas to Panama City, bringing its Venezuelan management personnel with it. The company is financing the expansion of the International School of Panama to accommodate the kids of the new Venezuelan exiles, a move certain to change the social and linguistic character of that school.

CSS puts 46 real estate parcels on sale

The Social Security Fund (CSS) has decided to sell 46 parcels of real estate, mostly large ones in beach communities of the Interior, to the highest bidders. The aggregate assessed value is $215 million and the fund's directors say that they are taking advantage of the real estate boom to get maximum value. Some labor leaders criticize the move as a too-hasty dissipation of CSS assets, placing them in the hands of speculators without using the fund's powers and assets to actually see that they are developed not only for high income for the fund but also to create jobs in the communities where the lands are located.

Trump bond sale postponed, consummated

The issuance of bonds for the Trump Ocean Tower, a Colombian project that rents the name of the New York developer, was delayed and then two days later carried out, with a quick sale that raised $225 million. The Colombian-owned Newland International will pay 9.5 percent interest on these bonds, which are rated as below investment grade.

ANAM cites AES for violating hydro dam terms

The National Environmental Authority (ANAM) has cited the AES power company for non-compliance with the approved environmental plan for a hydroelectric dam on the Changuinola River in Bocas del Toro. So what are they not doing right? ANAM says that one of the thing that the company is not doing is giving the required relocation assistance to the mostly indigenous families who are being driven from their homes and lands by the dam project. The project has also prompted a dispute between ANAM and the Ministry of Public Works, with the latter arguing that because a proposed access road runs through a protected national forest, ANAM improperly classified the project in the first place and thus improperly approved such an environmental plan as there is.

Poll shows drop in free market support

According to the polling firm Latinobarometro, Panamanians are increasingly unimpressed by arguments that development should be left up to market forces. In 2005 the company found that 56 percent of Panamanians believed that reliance on the market is the best way to get out of underdevelopment, but now only 31 percent believe that.

Endara not lamenting treaty stall

Most opposition leaders are criticizing the PRD for making Pedro Miguel González president of the National Assembly and thus turning the US Congress against the US-Panama Trade Promotion Agreement. Former President Guillermo Endara, leader of the Vanguardia Moral de la Patria party, runner-up in the 2004 presidential contest and a potential 2009 candidate, differs from his colleagues in that respect. Not that Endara has much use for González, but he says he's happy that the treaty is not going through. Endara cites the duty-free imports of subsidized US farm products driving Panamanian farmers out of business and Panama giving up the right to its own food safety standards as his major objections to the proposed treaty.

Martinelli accuses PRD of wage manipulation

The labor - management talks over minimum wage levels are at an impasse and supermarket baron Ricardo Martinelli is blaming the PRD. Martinelli, the owner of Super 99 stores and the Cambio Democratico party and a possible 2009 presidential candidate, says that members of the ruling Democratic Revolutionary Party's business owners' group, the Frente Empresarial, are the intransigent ones who are stalling the talks in an attempt to keep workers' wages low. If the impasse continues, by law the president will set the minimum wage by decree.

Developer sues government over litigation delay

Ignoring its own land use plan (which had the force of law) and procedures required by law, the former Interoceanic Regional Authority (ARI) sold a wooded parcel of the former Fort Clayton that had been set aside as park land and moreover included a recognized historical site to Inmobilaria P&P, a company owned by Carlos Eduardo Pasco Henríquez, for a housing development. An alliance of neighbors, historic preservationists and environmentalists sued, and the courts suspended work while the litigation was pending. Finally the Supreme Court ruled that ARI's land use plan and the law under which it was created are not binding and lifted the suspension. Now the developer has sued the government for more than $10 million for the delay caused by the litigation.

Mariano Rivera accepts $45 million over three years

Yankees closer Mariano Rivera didn't have such a great season (by his standards) in 2007, but he's good enough that the team wanted to keep him. After briefly declaring his free agency, Rivera accepted a three-year, $45-million contract to continue pitching with the Yankees.

Hotel owners resist music royalties

Under a decree enacted earlier this year hotels at which music is played must, depending on their size, pay the Panamanian Society of Authors and Composers (SPAC) $17 to $20 per month. The society has sued three hotels in the Interior to enforce this, but with the backing of the Panamanian Hotels Association (APATEL) the businesses plan to challenge the decree in court.

Tico truckers close the border

On November 12 Costa Rican truck drivers blocked the border crossing at Paso Canoas for 10 hours. Their complaint was that Panama is requiring them to buy a $25 insurance policy in order to drive their rigs into this country. There is a reciprocal Central American treaty to allow truckers from Panama and the Central American countries to haul loads across borders, but the Costa Ricans say that Panama's insurance requirement is unilateral and discriminatory and violates the agreement. The Panamanian government says that under this country's revised transit code, everyone has to have insurance in order to drive on our roads.

Cattle deaths attributed to cold wave

The Ministry of Agricultural Development (MIDA) says that a mid-November cold wave in the mountains along the western part of the Azuero Peninsula killed at least 235 cattle in Veraguas, Herrera and Los Santos provinces. This is unusual and the ministry has put several veterinarians on the job of investigating the problem. It might also be a case of interest to climate change researchers.

Former utility workers on hunger strike

Back in 1990, workers at the then state-owned IRHE electric company went on strike and were fired by the government, then headed by Guillermo Endara. They sued. By treaty the court of last resort in such cases is the Inter-American Human Rights Court, which meets in San Jose, Costa Rica. Almost a decade later, the court ruled in the workers' favor and ordered the payment of damages. However, the Moscoso administration insisted that the workers take pennies on the dollar of the award. A few accepted, but 270 did not and the Torrijos administration is completely ignoring the verdict --- while telling members of the US Congress that labor laws are respected in Panama. As of November 19 two former IRHE workers, Rodolfo Vence and Javier Muñoz went on hunger strike in front of the courthouse in the Costa Rican capital to press their demand that Panama's government respect the decision in their favor.

Let's guess --- a woman does his grocery shopping?

Agriculture Minister Guillermo Salazar made an astounding announcement in La Estrella on November 20. "Production of Grade A milk is going up." No shortage here, just producers selling to competitors of those to whom they were selling before, he tells us. In the stores, the price of shelf-life milk is up substantially and fresh milk is in short supply but Salazar, also a big promoter of the stalled US-Panama free trade deal, assures us that there is no problem and it's up to the companies to decide where to sell milk.

Also in this section:
Doctors' strike prolonged
Mark Boswell's alias Rex Freeman's Costa Rica office raided
Business & Economy Briefs