Panama Business & Economy Briefs

Business & Economy Briefs

Singaporean port company out of Farfan competition

The bidding to build and run a "mega-port" at Farfan, a former US Navy housing area adjacent to the former Howard Air Force Base, may be off. One of the three qualified bidders, Singapore PSA Corporation, which is already developing a commercial port at nearby Rodman, has dropped out of the competition. The other two companies, the partially Chinese state-owned China Overseas Shipping Corporation (COSCO) and the San Francisco-based Marine Terminals Corporation, are, according to La Prensa, considering teaming up to present the Panama Maritime Authority (AMP) with a joint proposal. Many economists are predicting that the US economy is going to be in recession and that US imports from China will stagnate or decline for awhile, notwithstanding the Panama Canal Authority's referendum campaign predictions of a constant and steep growth over the coming 20 years. This is already reflected in a slight decline in US-bound containers going through the canal so far this year. That, plus the thawing of the Northwest Passage long before anyone had expected it, have the world maritime industry hedging its bets about the Panama Canal's importance. The bottom line may be that Panama won't get as good a mega-port investment deal as had been contemplated.

Panama to Paris by way of Guadeloupe

US visa restrictions in particular and hostility to foreigners in general are again making it easier to travel to and from Europe without dealing with the Americans. There is now Air Caraibes air service between Panama and France that consists of Wednesday and Friday Panama to Guadeloupe flights, connecting to flights from that French Caribbean island to Paris.

Howard gets its first charter tourist flight

On January 16 the former Howard Air Force Base, now a special economic development zone, saw the first arrival of a charter flight full of tourists. A Boeing 737-800 from Miami Air International came loaded with 171 vacationers flying in from North Carolina.

Deal on cheap Venezuelan diesel for buses

Panama's bus driver/owner syndicates, battered by high fuel prices, are demanding higher fuel subsidies and fare increases from the government. The Torrijos administration, already into the 2009 election cycle in which it hopes to maintain the PRD in power, doesn't want to do something so politically unpopular and profoundly inflationary as raising bus fares. What to do? One of the things it has done is struck a deal with Venezuela's state-owned PDVSA oil company to get relatively cheap diesel fuel to keep the buses running. The plan is to be able to provide the bus drivers with diesel at $2 per gallon.

Fitch raises Panama's bond rating

The Fitch debt rating service has raised Panama's bond rating from BB+ with a "stable" rating to BB+ with a "positive" rating. That still leaves the bonds that are issued to finance the debt that the Torrijos administration has run up and for the Panama Canal expansion at less than investment grade. Thus the Panamanian people will have to pay higher interest rates on these debts than more credit-worthy countries would, but probably slightly less than before.

Criminal complaint against Elektra Noreste

The families of two bomberos who were killed and a third firefighter who was injured by electrical shocks this past November when the power was not shut off during a fire in the Colon Free Zone have filed negligent homicide charges against the Elektra Noreste power utility. Lawyers for the families of Dimas Sanabria and Manuel Ábrego, and for the injured Alberto Machado, allege that the company didn't turn off the electricity as ordered by the fire department and that the two firefighters died and several others were injured when a fire truck touched a live power line. Shortly after the incident the company gave several versions of what happened and why it is not responsible for the deaths and injuries. It does appear that in any thorough examination of what happened in that tragic fire the issue of unsafe design --- congested loading and unloading areas that made it hard for firefighters to maneuver, lack of fire hydrants, and maybe an electrical system that had the company thinking it had cut the power at the scene of the fire when it hadn't --- is likely to be raised.

Three bidders approved for two cell phone concessions

A Panamanian subsidiary of the Irish company Digicel; Telemovil El Salvador SA, which is itself a subsidiary of the Luxembourg company Milicom International; and Mexican billionaire Carlos Slim's Claro de America Movil all received the National Public Services Authority's permission to bid on two new cell phone concessions that will be awarded this year. A fourth company did not qualify to bid.

Gambling up

The Gaming Control Board (JCJ) reports that the amount of money legally bet in Panama in 2007 added up to $948.1 million, which is a little more than 19 percent higher than in 2006.

Environmentalists hit light fine

Grupo Isla Viveros, one of whose principals is President Torrijos's campaign manager Héctor Alemán, has previously issued death threats against construction union members, had the National Police actually shoot and kill an unarmed union member, destroyed more than a half-dozen archaeological sites and received a nominal fine for that. Now, for the second time, been fined for deforesting part of the Perlas Archipelago island that they intend to turn into a luxury resort community for foreigners. This time it was about two hectares of trees they illegally cut, and for this the National Environmental Authority (ANAM) imposed a $9,214 fine, which includes the costs of fixing the damage. A number of environmentalist groups have protested the favored treatment. Alida Spadafora, the director of the National Association for the Conservation of Nature (ANCON), alleging that the runoff from the deforestation has harmed sensitive coral formation, called the fine "laughable" in La Prensa.

Cabinet, meeting in David, met by anti-dam pickets

On January 18 the president and his cabinet met at the Casa de Gobernacion in Chiriqui, while outside a crowd from the Comite de Defensa de Rios picketed to protest plans to dam the David River in Dolega for hydroelectric generation. President Torrijos left the meeting via the back door to avoid the protesters, while National Environmental Authority (ANAM) director scolded the group for picketing the president and cabinet instead of filing their objections with her agency.

Foreign Ministry kickbacks probe

El Siglo reports an investigation of a kickback scheme in the Ministry of Foreign Relations. The ministry is headed by Vice President Samuel Lewis Navarro, who is mentioned by the first lady as her favorite for president in 2009 but garners 0.9 percent public support in his most favorable poll results. According to documents obtained and published by the tabloid, ministry employees solicited campaign contributions from the institution's suppliers, to be offset by higher prices that would be paid for what the businesses would sell to the ministry.

How do you lose those?

La Prensa reports that a Comptroller General's audit of the semi-autonomous public authority that runs Tocumen Airport has found 11 boarding ramps missing. Usually someone who steals one of those finds it difficult to conceal. If the audit's accuracy holds up, color this one "open corruption."

No bids on presidential slush fund contracts

It used to be that the legislators had circuit funds to be spent on projects in their districts. Those were eliminated by President Torrijos, who instead created the Community Development Program (PRODEC) to do essentially the same thing except under his control. Both PRODEC and the old circuit funds are and were respectively basically political patronage slush funds. Now the cabinet has issued a decree that PRODEC contracts, because they address "urgent needs," will be awarded without the bidding procedures ordinarily required of government contracts. Of course it's urgent --- we're into an election cycle.

Flight school operations ordered to move

The Civil Aeronautics Authority (AAC) has ordered flight schools that had been operating out of Albrook to move their flight lessons out to Calzada Larga airstrip near Las Cumbres. The schools can still keep their aircraft at the hangars in Albrook, but the AAC decided that the capital's domestic commercial airport and main general aviation center was becoming dangerously congested and students had to go elsewhere to practice their takeoffs and landings in order to relieve the pressure.

FSU buildings transferred to UMIP

Florida State University's Panama campus move is closer now that La Boca buildings 980 and 982 have been officially transferred to the International Maritime University of Panama (UMIP, by its Spanish initials). The actual move comes later this year, but FSU hasn't announced specifically where they're going.

Land invaders resist eviction

Some 60 families that had invaded privately owned land in the Loma Linda neighborhood of Pedregal, Chiriqui fought a pitched battle with police who came to evict them on January 24. After a spirited exchange of rocks and bottles on the one side and tear gas on the other, the two sides fought closer combat, hitting one another with sticks, but after a few arrests and the destruction of the squatters' shacks the police ended up in control of the battlefield.

Torn-up streets lead to a blocked highway

Minister of Public Works Benjamín Colamarco was much more effective at beating up dissidents when he was the head of General Noriega's Dignity Battalions goon squad than he is at keeping the nation's public works in a reasonable state of repair. All across the country there are streets with massive holes, sewers and storm drains overflowing into the streets, bridges that people fear will collapse, highways with crumbling edges and rural roads that are impassable. In keeping with Panama's political culture, people who have become exasperated and have no political influence to wield are increasingly reacting to the situation by blocking the nation's main traffic routes. On January 24 it was the turn of Nata residents, who blocked the Pan-American Highway in that Cocle town near the Nestle plant. The complaint was that a government contractor, Servicios de Mantenimiento y Construcciones SA, had torn up the local streets for a sewer line replacement job and left them that way, with the Ministry of Public Works, the IDAAN water and sewer utility and the company then playing a triangular finger pointing game about why it wasn't their responsibility to restore the streets. Eventually the riot police came in and reopened the nation's main drag to traffic.

Attacks on buses lead to a blocked highway

Bus drivers from 37 routes in the eastern parts of Panama province blocked the Pan-American Highway in front of the La Doña shopping center on January 23, to protest a crime wave affecting them, particularly in the 24 de Diciembre neighborhood. They complain that in the past couple of months there have been dozens of attacks on bus drivers and passengers in that corregimiento, mostly robberies but also assaults and homicides. Mostly it has been the work of armed juvenile gangs.

Balbina approves 22-story buildings in Clayton

Forget all that sales hype of yesteryear about Clayton being a "garden community." Forget about a neighborhood relatively safe from city traffic. Forget about sewers that only occasionally overflow. Balbina Herrera's Ministry of Housing has approved 22-story apartment towers for the former Fort Clayton, without any corresponding expansion of the infrastructures to support such development. Neighborhood activists will fight the zoning change in court, but that seems like a long shot. A legal challenge that creates sufficient delay, however, may run out the clock on Balbina Herrera and Martín Torrijos and there is a chance that the next administration might not be so securely in the developers' pockets.

Health Ministry tickets food establishments

In a wave of surprise inspections of food selling establishments, the Ministry of Health ticketed 80 restaurants, stores and bakeries for violating health regulations and ordered two bakeries and a restaurant closed. The cited establishments will be given a chance to clean up their premises and practices and continue in business.

You mean arroz con gusanos isn't an Interior delicacy?

The Consumer Protection and Free Competition Authority has seized more than half a ton of rice in five-pound packages from supermarkets in Chitre. The rice was infested with caterpillars and some customers who didn't appreciate the extra protein complained.

News \| Business \| Editorial \| Opinion \| Letters \| Arts \| Review \| Community \| Fun \| Travel Unclassified Ads \| Calendar \| Outdoors \| Dining \| Science \| Sports \| Español \| Front Page Archives	Volume 14, Number 2 Jan. 20 - Feb. 2, 2008

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