Panama and Colombia are expected to sign a bilateral free trade agreement in Panama City today, finalizing a commitment that was reached by the two countries last June. Panamanian Minister of Commerce and Industry Ricardo Quijano and Colombian Minister of Commerce, Industry and Tourism Sergio Díaz-Granados will participate in the official treaty-signing ceremony.
During a television interview yesterday, Panamanian President Ricardo Martinelli expressed optimism about the agreement, saying that it is pivotal for Panama’s integration into the Pacific Alliance. Panama currently has free trade agreements with Chile and Peru and seeks to establish bilateral trade agreements with other Pacific Alliance member states—including Mexico, Chile and Colombia.
Martinelli also confirmed that the agreement will end what he has deemed an "unfair and detrimental” aspect of Panama’s trade relationship with Colombia. Currently, Colombia imposes a 10 percent “re-exportation” tariff on Panamanian-produced textiles and footwear before they are shipped internationally from Colombia’s free trade zone, Zona Libre de Colón. Last year, Colombian exports to Panama amounted to $2.857 billion, 80 percent of which was accounted for by crude oil. In contrast, Panama only exported $72 million of goods to Colombia, represented mainly by apparel shipments.
A trade deal between the U.S. and Panama that was negotiated five years ago went into force on Wednesday. The agreement, which will allow increased U.S. exports into the country, was signed by former president George W. Bush in June 2007 and ratified by Panama’s parliament the same year. However, the U.S. Congress held up the agreement with concerns over Panamanian labor protections and tax haven laws. It was finally ratified on October 12, 2011 and signed into law by President Obama on October 21, 2011.
The trade promotion agreement, known in Spanish as El Tratado de Promoción Comercial (the Treaty of Commercial Promotion) will eliminate Panama’s tariffs on 86 percent of U.S. goods such as cars, medical and information technology, chemicals, and electrical equipment. It also eliminates Panama’s tariffs on 50 percent of U.S. agricultural exports. Other tariffs will be phased out over time. The agreement will open the U.S. market to 100 percent of Panama’s industrial and fisheries products, as well as textiles and artisanal items.
Ricardo Quijano, Panama’s minister of commerce and industry, said that the trade agreement would benefit Panamanian consumers, who he said will pay less for products that enter the country without taxes. He argued that the agreement will give Panama the tools it needs to compete in a free market economy while the country is in the midst of a $5.3 billion canal expansion project.
However, members of Panama’s agricultural sector are worried that they are not prepared to deal with a flood of low-priced products from the United States. The Asociación Nacional de Benefactores y Exportadores de Café (National Association of Coffee Benefactors and Exporters) said they were worried about the reduction of tariffs on instant coffee.
“The direct consequence of this measure is the accelerated loss of the national market stocked by national producers, benefitting transnationals with a lot of economic power,” said the coffee producers in a public announcement.
The U.S. is Panama’s principal trade partner, with $163 million of Panama’s $785 million in exports destined for the U.S.
Top stories this week are likely to include: Fidel Castro’s birthday; Buenos Aires subway shutdown continues; public teachers to end striking in Panama; talks to renew in Colombia between the government and the Indigenous Nasa; and a possible dialogue over Venezuela’s detained U.S. Marine.
Fidel Turns 86 Years Old: Cuba’s revolutionary leader and former president, Fidel Castro, turns 86 years old today. He faces health issues, having stepped down from the presidency in 2006 after undergoing intestinal surgery—and has not been seen in public or mentioned in the news since June 19, according to Reuters. AQ Editor-in-Chief Christopher Sabatini notes of the occasion, “Six years ago when Fidel Castro stepped aside to pass the torch to his brother Raúl, people thought the end was near. Give the man's staying power credit, but really, what modern country in the region and in the world remains as centered and fixated on an 86-year-old man? It's a sign of how little Cuba—and U.S. policy toward the island—has progressed. We're all stuck in the past.”
Subway Shutdown in Buenos Aires: A strike by union employees of Buenos Aires’ municipal subway system is entering its tenth day today, with no end in sight after talks broke down on Friday with the administration of Mayor Mauricio Macri. The subway shutdown has inconvenienced between 600,000 and 1 million daily commuters. Macri, the most prominent figure of the opposition Propuesta Republicana (Republican Proposal—PRO) party, is blaming the ruling Frente para la Victoria (Front for Victory—FPV) party, to which President Cristina Fernández belongs. Macri is accusing FPV operatives of inciting the union workers, who are demanding a 28 percent increase in pay. Buenos Aires Deputy Mayor Maria Eugenia Vidal stated that the city officials “just don’t have the means to pay for this.” Pay attention to see if there will be any breakthrough in negotiations this week.
Teacher Strike to End in Panama: Leaders of a teacher strike in Panama reached an understanding with the government on Saturday to end the weeklong strike today. Teachers were protesting over issues such as decaying classrooms and insufficient pay.
Santos-Nasa Mediation To Resume in Colombia: Leaders of the Indigenous Nasa group expect to set a date by this Tuesday for the resumption of mediated talks with the government of Juan Manuel Santos. More than 10,000 Nasas marched in the department of Cauca yesterday demanding the government return to the table. Cauca, in southwest Colombia, is home to many rebels belonging to the Fuerzas Armadas Revolucionarias de Colombia (Revolutionary Armed Forces of Colombia—FARC). The Santos administration, therefore, has placed many Colombian soldiers in Cauca as part of the ongoing internal conflict with the FARC, which the Nasa view as a threat to their territorial sovereignty. The Nasas and the government, however, hope to reach an agreement through mediation.
Venezuela-U.S. Showdown Over Detention: After Venezuelan President Hugo Chávez announced late last week that police have detained an American citizen who claimed to be a former U.S. Marine, tensions have flared between the U.S. and Venezuelan governments. According to the Associated Press, a State Department official said that the U.S. authorities were not notified of his arrest. Chávez has openly suspected that the detainee, whose name has not been released, may be a “mercenary” scheming to destabilize Venezuela. Stay tuned to see if there may be more updates on this case in the coming week.
EXTRA, Rio 2016: After yesterday’s closing ceremony of the 2012 Olympic Games in London, the world’s attention turns to Rio de Janeiro for 2016. But is the city ready? Check out AQ’s television segment on Brazil and the Olympics on the “Efecto Naím” program on NTN24.
On March 29, the U.S. Senate confirmed several of President Obama’s diplomatic nominations, many of whom were tapped to serve in the State Department’s Bureau of Western Hemisphere Affairs (WHA). Here’s a brief rundown of the confirmed WHA officials and their new positions: Roberta Jacobson, Assistant Secretary of State for Western Hemisphere Affairs; Larry Palmer, Ambassador to Barbados; Pamela White, Ambassador to Haiti; Phyllis Powers, Ambassador to Nicaragua; Jonathan Farrar, Ambassador to Panama; and Julissa Reynoso, Ambassador to Uruguay.
Not only do these confirmations provide a celebratory sense of relief, as many of these officials waited months for their nominations to proceed through the Senate, but the timing could not be better as the U.S. delegation prepares to depart for Cartagena, Colombia, to attend this weekend’s Sixth Summit of the Americas.
Jacobson was nominated in late September after becoming acting assistant secretary in July 2011 when her predecessor, Arturo Valenzuela, returned to academia. It’s both notable and laudable that a woman is leading WHA for the first time.
Jacobson’s candidature was challenged by Cuban-American Senator Marco Rubio (R-FL), who placed a hold on her nomination last November with a call to the Obama administration to “review abuses in the people-to-people Cuba travel policy.” Rubio dropped his hold on March 22 following guarantees from the State Department that it would require “applicants to demonstrate how their itineraries constitute purposeful travel that would support civil society in Cuba and help promote their independence from Cuban authorities,” according to the senator’s news release.
AQ Online today launches its weekly Monday Memo that looks ahead to what it expects to be the top headline grabbers for the week. The top anticipated stories for the week of February 27 include: Hugo Chávez’ surgery; U.S. Secretary of Homeland Security Janet Napolitano’s current five-country Latin America tour; U.S. Vice President’s forthcoming visit to Mexico and Honduras; the search for a new prime minister in Haiti; and FARC suspending kidnappings in Colombia.
Chávez' Cancer: As the Venezuelan president heads to Cuba for a second surgical operation, the rumor mill on his real health status will continue as will the discussion about what its implications will be for Venezuela's October presidential election. Christopher Sabatini, AQ editor-in-chief, observes: “While it may translate into sympathy support, President Chávez' lack of transparency about his illness and treatment will likely raise fears among some Venezuelans about their future and a potential successor—irrespective of what the president says upon his release.”
Napolitano on Latin America Tour: U.S. Secretary of Homeland Security Janet Napolitano begins a five-country tour today through Wednesday in Mexico, Guatemala, El Salvador, Costa Rica, and Panama. According to a Department of Homeland Security (DHS) press release, Secretary Napolitano will be accompanied by Acting Commissioner of U.S. Customs and Border Protection David Aguilar and DHS Assistant Secretary for International Affairs Alan Bersin. Her visit is likely intended to reiterate support for security measures like the Central America Regional Security Initiative and reinforce counter-trafficking efforts to interdict narcotics through key transit points.
Biden to Mexico and Honduras: U.S. Vice President Joe Biden will visit Mexico and Honduras on March 4-6, meeting with both Presidents Calderón and Lobo. Why is the Vice President going to Honduras? While Mexico remains an important economic, diplomatic and strategic partner in the war on drugs, the trip to Honduras is a mystery. Since the 2009 coup, Honduras has become the murder capital of Central America. Two weeks ago, a fire at a Honduran prison left 350 inmates dead—an incident that Human Rights Watch blamed on poor and overcrowded conditions in Honduran prisons.
Haiti Prime Minister Watch: The abrupt resignation of Haitian Prime Minister Gary Conille on Friday culminated weeks of disagreement between him and President Michel Martelly. The departure of the former UN diplomat and favorite of the international aid community is a blow for both political stability in Haiti and for donor nations that had great hopes in a government that included his technical skills. Jason Marczak, AQ senior editor, says: “Expect President Martelly to move quickly in naming a successor, with a candidate likely announced this week.” Foreign Minister Laurent Lamothe is one possibility as is Chief of Staff Ann-Valerie Milfort. However, both would face a tough confirmation by an opposition-controlled legislature.
FARC Hostage Release: Colombia's FARC announced on Sunday that it will suspend all kidnapping and free remaining prisoners. Is this a political ploy or a true change in tactics? Given the group's decentralized nature, it is unclear whether the FARC secretariat can actually enforce the order, if it chooses to do so. Expect renewed debate this week on whether this may help to clear the way for an eventual peace dialogue or if the current strategy should continue without talks.
Panamanian President Ricardo Martinelli signed a pledge on Tuesday stating that he will not seek reelection in the country’s 2014 presidential elections. According to media observers in Panama, Martinelli made the pledge in response to controversial rumors of his desire to run again in a country with strict constitutional prohibitions against consecutive presidential terms. Until recently, President Martinelli's approval ratings hovered around 80 percent, but recent actions to quell protests by the Indigenous Ngabes Buglés people regarding mining and hydroelectric activities has brought his job approval and likability figures to around 33 percent—their lowest levels ever.
Martinelli challenged members of the opposition to sign a similar document and accused opposition parties of spreading false rumors about his seeking reelection. However, opposition party leader Francisco Sanchez of the Partido Revolucionario Democratico says the president’s move “shows that no one believes him,” and only serves to underline the Martinelli administration’s desperation to improve its job approval figures.
The latest poll, released Tuesday by research firm Dichter & Neira, questioned 1,200 people and found that 80.3 percent of respondents disapproved of how Martinelli handled the Indigenous strike. In addition, 71.8 percent believed the administration authorized excessive force against the protesters.
As the global marketplace becomes increasingly competitive, the pressures of manufacturing costs have risen to the forefront. These challenges drive the locations of manufacturing, where products are transported and where investors look to spend their capital. It seems that the days of faulty, substandard major projects in Central America are over as individual governments take seriously the attractions for businesses to manufacture in other world regions.
From Guatemala to the end of the isthmus at Panama, Central American nations have all realized that the only way their countries can be competitive in the modern global economy is by building a first-class infrastructure. These outputs must offer sufficient capacity to handle the demands of the movement and delivery of goods, people and services in a cost-effective and efficient manner. Every country is pouring significant funds into infrastructure, with Panama, Guatemala and Costa Rica leading the pack.
Panama, which is often considered to be the “hub of the Americas” in terms of maritime and aviation, has spent over $3 billion in projects related to the widening of the Panama Canal, and another $3 billion in the construction of a metro-rail transportation system, among other initiatives. Meanwhile, Costa Rica has posted an impressive growth rate in recent years due primarily to tourism and producing high-value products. However, Costa Rica has been criticized for its lack of infrastructure and for the bureaucratic delays that surround the approval of any major project. With hopes of sustaining its current growth, Costa Rica has responded to this criticism by reforming its concessions law to further attract investment as well as signing a historic free-trade agreement with China, aimed at attracting heavy infrastructure-related foreign direct investment as it recently did.
For the second day in a row, Indigenous groups protesting mineral resource extraction and hydroelectric projects in Panama shut down parts of the Pan-American Highway yesterday. Hundreds of Indigenous Panamanians from the Ngabe Buglé comarca in the country’s northwest placed tree branches and rocks at points along the highway in Chiriquí and Veraguas provinces, as well as on the highway between Chiriquí and Boca del Tora. All locations are part of the comarca, a type of reservation for the Ngabe and Buglé Indigenous groups with a high degree of administrative autonomy.
The demonstrators were protesting mining activities and the construction of hydroelectric projects in the region. Their leader, Toribio García, told local press that “we don’t want transnational companies to take over our natural resources and [cause people to] lose their lands.” Specifically, the Indigenous protesters were incensed over the approval last week by the National Assembly’s Commerce Committee of a bill, Ley 415, which addresses the protection of mineral, water and other natural resources in their region. They said they were not consulted during debate over the bill, and demanded that Article 5 of the original bill, which was dropped in the approved version, be reinstated. That article had called for an immediate suspension of all active concessions to national or foreign companies interested in mineral resource extraction or the development of hydroelectric plants within Ngabe Buglé and neighboring territories.
Representative Raúl Hernández, president of the Commerce Committee, said all groups had been invited to contribute, and the bill as it was endorsed “fulfills its obligations from all sides.” Before becoming law, the bill will go through two more rounds of debate and, possibly, further modifications.
In March 2011, faced with strong opposition and protests by Indigenous groups, the Panamanian government was forced to repeal a law that would have opened mining activities in Panama to private and foreign investment.
¡Bang! ¡bang!. Viene un tipo, viene otro, luego serán más. Drogas, dólares y mucha sangre. Aquí todos matan a todos. ¡Bang! ¡bang! Una típica película hollywoodense del hampa chicana. Aunque esta vez el escenario es Panamá, la película es panameña y su autor es Panamalo.
Panamalo no cuenta su película. La actúa. Tiene ese idéntico gesto de matón de barrio turbio. Cambia la postura sacando un poco la panza, echando los hombros para atrás, abriendo los brazos, ostentando un par de pulseras y un reloj demasiado grande para su estatura. Tuerce los labios hacia abajo, burlón, y habla en un tono Caribe veloz, do mayor, casi ininteligible (por aquí diríamos que tiene una papa caliente en la boca). Los ojos le brillan. Casi, casi quisiera que eso que imagina fuese real. Pronto dirá, enfático: “Es real”. Es más, su protagonista, el malo, el corrupto, es—dice Panamalo—el vicepresidente. No se sabe si se refiere a la ficción o habla del gobierno actual de su país. Aunque al mismo tiempo, y a estas alturas, todos sabemos que Panamalo sabe lo que dice.
No fue difícil llamarlo Panamalo. Un joven panameño aspirante a director de cine. El caso es que Panamalo reniega y no se tapa la boca. Se sienta y me cuenta que allí donde estamos, en Ciudad del Saber, vivían los norteamericanos. Esos insoportables que ocuparon desde el siglo pasado 16 kilómetros de territorio panameño, ocho a cada lado del Canal de Panamá. Y que todo “su” territorio era inviolable y al que los panameños no podían entrar—¡en su propio país!, Panamalo alza la voz y sus ojos se inflan—, pero que los gringos podían, libremente, pasar y pisar la ciudad. Ellos tenían todo—relata Panamalo torciendo la boca, como cuando cuenta su película: sus supermercados, sus escuelas, sus centros médicos, sus cines, sus parques de diversión, sus viviendas, todo. Se llamaban y hasta ahora se llaman “zonians”. Es decir, nacidos en la zona—entonces norteamericana—del Canal. Ciertamente no eran panameños, no. Eran norteamericanos, aunque…tampoco. Eran “zonians”.
Y Panamalo pronuncia esta palabra como si hablase inglés. Habla. Es más, su esposa es norteamericana. Ajá.
Desde que los norteamericanos habitaron Panamá desde 1914 hasta 1999, los panameños tienen un conflicto de identidad. (Lo mismo que los “zonians” en los Estados Unidos quienes se reúnen anualmente en la Florida, “dominan los dos idiomas, bailan como panameños y actúan como gringos”. De hecho, John McCain es un “zonian”). Panamalo nos lleva a su bar preferido en el Casco Viejo de la ciudad cuyo dueño es un neoyorquino que dice no hablar español pero que cuando nadie lo oye, habla a la perfección. Allí está Felix que dice “hola” queriendo decir “hi”. Porque inmediatamente después comienza a hablar en inglés. Lo interpelo un poco bromeando y entonces saca del fondo de su memoria sus orígenes panameños—nació en Panamá—pero Felix tiene el corazón partido porque se crió en Puerto Rico. So, tú sabes. Y de ahí a Nueva York, no es nada. Entonces, Felix recupera la pose y dice “I am the boss, you know?” y mira a Panamalo pidiendo aprobación.
Panamalo tiene un país atorado en la garganta. Y cada que puede, escupe. Porque sólo él ha podido responderme ¿por qué en un país con 20 mil millones de dólares anuales de producto interno bruto para sólo 3 millones de habitantes, hay 37 por ciento de pobreza? La anécdota son aquellos hermosos edificios que se yerguen en la ciudad más promisoria de América Latina pero que están deshabitados porque—dicen las malas lenguas—son fruto del lavado de dólares del narcotráfico y la corrupción interna y la de los vecinos más próximos. El resto de la respuesta es casi previsible. ¡Bang! ¡bang! Panamalo.
Cecilia Lanza es una bloguera que contribuye a AQ Online y vive en La Paz, Bolivia.
From Americas Society/Council of the Americas. AS/COA Online's news brief examines the major—as well as some of the overlooked—events and stories occurring across the Americas. Check back every Wednesday for the weekly roundup.
Floods Hit Central America
Rainfall of as much as 47 inches fell in Central America this week, three times the average for this month. The rains caused heavy flooding and destruction of infrastructure, resulting in the displacement of 700,000 people and a death toll of more than 90. The governments of El Salvador and Nicaragua declared national states of emergency, and Honduras declared one in its southern region. Aid from Spain, Taiwan, the United States, and Venezuela poured into the region amid local pleas for humanitarian assistance.
Guatemalan Prez Declared Fugitive of Justice
A court in Guatemala declared former President Óscar Mejía a fugitive of justice after police failed to locate him in Guatemala City. Mejía is wanted for ordering massacres of indigenous peoples during his time as military chief (1982-83) under former dictator Efraín Ríos Montt. The trial of another general facing human rights abuse charges during the civil war (1960-1996), Hector Mario López, was delayed for the third time when the general arrived sedated. Central American Politics Blog questions if these are tactics to delay proceedings until after next month’s presidential election, when a former military official, Otto Pérez Molina, may win.
Obama to Sign FTAs on Friday
The White House announced that President Obama will sign the Colombia, South Korea, and Panama free trade deals this Friday. The signing will take place in the White House Rose Garden, where the president will be joined by workers, as well as business and labor leaders.
In a blog post for Americas Quarterly, COA Vice President Eric Farnsworth explores the roles played by members of the Obama administration and the U.S. Congress in passing the long-pending free trade deals.
An AS/COA Online Congressional Update covers the legislative process behind the trade pacts’ approval.