Envío Digital
Central American University - UCA  
  Number 460 | Octubre 2019



The new government’s first steps

Panama has a new President,. but he has inherited some serious pending issues: medicine shortages in the Social Security Administration, arms expenses, narco-political connections, a water problem, large lumber exports at the cost of the country’s deforestation… There seem to be no clear and concrete plans for all of this. 

Jorge Sarsanedas

Laurentino Cortizo Cohen’s new government took office after almost two months of more or less friendly “gatherings” between its new officials.

A member of the Democratic Revolutionary Party ((RD), he was elected President on May 5 with 33.27% of the vote. Nonetheless, the PRD has a majority in the .Supreme Court and the legislative branch, in which Cortizo was one of its representatives between 1994 and 2004, serving a year as its president in 2000. The PRD also has the majority of municipal mayors. Cortizo’s new Cabinet combins two old PRD cadres from the Martín Torrijos government, of ten years ago and new figures with technocratic backgrounds. Some ministers have a “good rep” (those in Economy, Education, Environment and Culture), while little is known of the others.

The Legislative Assembly
ended up like this…

Cortizo didn’t offer anything new in his inaugural speech, just the same campaign promises, the same discourse of “firmness,” “teamwork” and “incorruptibility.” The PRD, took over the Assembly’s directive, making a small concession to Democratic Change (CD), the party of the imprisoned former President Ricardo Martinelli (2009- 2014).

Only 19.7% of the 71 legislative representatives are women and only four (5.6%) are indigenous, two from the Guna people (formerly known as Kuna) and two from the Ngäbe people, even though together they make up 13% of Panama’s population. The PRD lost votes in the Ngäbe-Bugle zone, which is why the new President made promises during his visit there tp create an indigenous university, grant some scholarships to women, promote the planting of special coffee there, provide text books to the schools and install electricity.

The country with the
best average salary

At the end of the last government, so Varela, of the Panameñista party, can be seen. The country’s average annual economic growth was 5.3%. Foreign direct investment increased 21.4% and public investment 19%. And according to official figures, poverty was reduced by 19%, though that difference isn’t visible.

During Varela’s administration, there was an increase in salaries. Teachers now earn US$1,200, doctors $1,700, and police $900, while the average monthly salary on the state payroll is S$1,445. The average monthly national salary
in 2018 was $744, making Panama the country with the best index in Latin America. By comparison Argentina’s average monthly salary is $513 and Nicaragua’s is even farther away, at $115. Nonetheless, 61% of Panama’s economically active population has precarious jobs and unemployment is 6.5%.

The Martinelli case…
and the others?

One of the citizenry’s big questions about the new government is what will happen with all the accused and their trials. There has already been an answer in the Martinelli case, the best known one, in which he was accused of spying on the communications of at least 150 people and of misuse of public funds to buy the equipment to conduct the espionage.

The under-the-table agreements between the government and the CD confirmed that the absolving ruling was cooked up there. The judicial argument to declare him “not guilty” was so long it took five hours to read. The short version is that not enough evidence was found to convict him due to technical errors in the indictment. Even though many voices were raised in protest, too much money is involved so it won’t go on.

Besides that case, other “high profile” ones under investigation since 2012 allegedly involving the public coffers
to the tune of over US$922 million are still pending resolution. Several of these cases have also been acquitted due to insufficient evidence, bad investigation and/or absurd decisions by judges. Where will all this corruption end up, with so much swindling, all the hidden bodies in the closet, all the ill-gotten gains…?

The priority is austerity
with efficiency

The new government kicked off its administration demonstrating new energy. Its first Cabinet meeting was held with a conflict over the fact that the province of Veraguas felt abandoned, but the main objective was to improve the agricultural problems. A new touch is that after the ministers meet each time, they hold a press conference, which improves public access to information.

The government has decided to prioritize the central concept of “austerity with efficiency” by public officials: fewer trips, less spending on cars and other privileges, a demand for effectiveness, efficient use of resources and the like. In short, an “expense containment” policy,.but Incongruences are already surfacing. Although education was proclaimed the “star” of the new government, its budget was cut by US$153.6 million and several million more was cut from the state universities. Education is obligatory in Panama up to 11th grade, but average schooling is 7 years and in the indigenous areas only 4.4 years.

In the Assembly, where Cortizo’s PRD used its majority to push through legislation, there seems to be no financial restraint: –a monthly salary of US$20,000 for legislators has already been approved, along with financing for their vehicles. Meanwhile, those reelected are stonewalling on submitting their expense sheets from the previous period. Everything suggests that they are trying to deluge us with declarations of their alleged transparency, accusations left and right and religious invocations, all to avoid actually being accountable.

Immigration and environment

Among the bills presented by the new legislators, accompanied by shouts, threats and insults, appeared one to put immigration in Panama “in order” but It ended up being a hysterically xenophobic tirade.

This issue of immigration came and went at the beginning of the new government. In 2018 only 9,022 people entered from Colombia, through Darién, the majority coming from Asia and Africa. There are no figures of how many were undocumented—called “irregulars.” There are reportedly now also 280,000 Colombians and 350,000 Venezuelans living in Panama. There are no numbers of the other nationalities.

Environmental issues are being sidelined, despite the urgencies. In Panama, 575 of its 1,731 animal species (33%) are endangered and 16% of our 10,444 plant species, are on the way to extinction. As for the forests, 11.6 hectares of those in Darién, along the border with Colombia, are deforested daily, about 4,000 a year. So, even though we don’t have an Amazon in flames, Darién’s forests are coming to an end.

It is said that the so-called “fourth line of electric transmission” will cost US$500 million to start working in 2023. It will reportedly “serve to develop the Atlantic coast,” even though the line runs all along the Central American Biological Corridor.

And then there’s also Panama Mining, which will exploit copper and gold. This Canadian company, which also has mines and other interests in Argentina, Peru, Zambia, Congo, Mauritania, Turkey, Spain and Finland, not to mention a big problem in Alaska, has already started to export copper concentrate. It proclaims that it engages in “inclusive, regulated and responsible” mining, but it has occupied 13,600 hectares of primary forests that were part of the Mesoamerican Biological Corridor, and has announced that it will work there for 40 years.

The PPPs are coming

The new government’s priority economic focus is on tourism and attracting investment... The rest will come later. The minister of public works in the first Cabinet has already announced that Public-Private Partnerships (PPPs) will play a central role during this government’s term. But he denied that it’s a privatization mechanism, and was echoed by the new Vice President and the president of the Panamanian Chamber of Construction.

In a broad study, Juan Jované, associate professor in the Economics Department of the University of Panama, analyzed what PPPs are and concludes that “we are facing a privatization situation when, as in the case of the PPPs, the State’s responsibilities are transferred to private businesses, even without the sale of assets.” To buttress his statement, he quotes 2001 Nobel Prize winner in Economic, Joseph Stiglitz, who has noted that while there has been a great deal of hyperbole over public-private partnerships in recent years, there has been disappointment in practice. PPPs often entail the government taking the risk and the private sector taking the profits.

Jované also points out that “PPPs are prone to corruption in each and every one of its various phases: the period of decision-making; the timing of the offer and the selecting; and the hiring and operation stage.” Knowing the nature of PPPs and the costs they represent for the wellbeing of the population as a whole, he concludes that “this project must be rejected by the population.”

Serious pending issues

There is some good news, however: there will be a Ministry of Culture; agriculture is taking off; the government will start to pay its overdue debts of US$250 million...

The country is starting to walk with a new government, but it’s like a person coming out of a serious illness, or thinks he is, but still sees no clear future… The reason is that there are several serious pending issues: the arms expenses, the tlack of medicines in the Social Security Administration, he narco-political connections, the nationwide water problem, the deforestation and the huge lumber exportation… It seems that there are no clear and concrete plans for all this.

Jorge Sarsaneda, sj, is a member
of the indigenous pastoral team
of the archdiocese of panama

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