Mr. Varela goes to Washington

JC and Christine
Perhaps the most important part of President Juan Carlos Varela’s trip to Washington was his meeting with International Monetary Fund director Christine Lagarde. The Presidencia did not play this up and the IMF was also cryptic and brief about what happened. But Panama has a rapidly expanding public debt and the IMF and other international financial institutions have been urging a politically toxic brew of tax increases and austerity measures to deal with the debt situation. The IMF tweeted that the two met “met … to discuss Panama’s economy and its efforts to enhance financial integrity [and] tax transparency.” The Presidencia’s website said that on the first full day in Washington Varela and Vice President and Foreign Minister Isabel de Saint Malo, Minister of Economy and Finance Dulcidio de la Guardia and Panama’s ambassador in Washington Emmanuel González Revilla met with Lagarde and then with Inter-American Development Bank president Luis Alberto Moreno “to review the state of affairs in Panama.” Photo by the IMF.

A deadpan reply about canal construction, sundry bland and vague assurances

by Eric Jackson

As President Juan Carlos Varela, First Lady Lorena Castillo de Varela and their entourage took off for five days of meetings in Washington the headlines here involved speculation over whether US President Donald Trump would ask for or demand US military bases in Panama. The American Embassy assured that this topic would not be broached, a range of various Panamanian nationalists insisted that it better not be, but the actual US forces who are here and have been for years — mercenaries attached to the US Southern Command flying out of Albrook, several drone bases around the country that may be at Panamanian installations but are run by Americans, US military advisers with diplomatic immunity attached to police units — were studiously ignored and left out of the conversation.

So is the United States going to get militarily aggressive against, say, Nicaragua, El Salvador, Ecuador, Bolivia, Venezuela or Cuba and use Panama as a base to do this? We don’t know. We are told that Panama’s relationship with the United States has been “completely renovated.” We are told that the two countries will “look for an exit from regional conflicts and fight the climate of insecurity in which certain regions of Central America live.” We are told that Varela shared with Trump his views about Venezuela and Cuba.

The meetings dedicated to economic subjects were also only sketchily reported. A few days after the trip, however, the OECD upgraded Panama’s status by way of one of its subcommittees finding progress toward transparency and an end to money laundering. Is this about real changes that have happened, or a reward for undisclosed undertakings about these or other economic matters?

There were meetings with congressional leaders of each party. A Panamanian cultural night was put on by the Panama Tourism Authority. There were declarations that Panama has maintaining a warlike stance on the matter of drugs, and bizarre claims that most of the drugs that come through Panama get intercepted. Varela gave his assurance that Panama will be part of an unspecified solution, rather than presenting an unspecified problem.

What made the US news? Trump could not resist congratulating himself and the USA for building the Panama Canal, and Varela responded “Yes, 100 years ago.” Neither acknowledged that the great majority of the canal builders back then were black men from the West Indies, which prompted some comments from academic and activist circles, and in turn elicited vitriolic responses from various alt-right and white supremacist circles.

It was announced that US Vice President Mike Pence will visit here sometime in August.

All in all, it seems that Panama will grin and bear whatever comes out of Washington into these latitudes, or at least almost anything. In a structural sense, that would mean little change in the relationship. In a substantive sense it would appear to be more volatile, given Trump’s unpredictability. It depends on what Donald Trump might decide to do next, which in turn is likely to be driven by US domestic politics.


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