The mayor of Panama City, Bosco Vallarino, finally found some luck when a Panamanian judge decided that Vallarino did not have to make a sworn statement in front of the anti-corruption prosecutor over how a $4,000 check from the municipality of Panama was issued to his wife. The mayor has had so many difficulties since taking office – budget problems, trash collection problems, criticism from the president – that he was hospitalized for a few days for exhaustion.
So far the mayor’s much anticipated Christmas project - La Vía Navideña – has received a mixed reception, with some praising the effort – very few - and others lamenting the loss of the Christmas Parade – very many. Certainly La Vía Navideña does not have the excitement and enthusiasm of the Christmas Parade, and it is placed right along a major highway and therefore is not the safest place for children to run around at night. But the mayor did successfully finish the project and people who live in the city center seem to like it.
Panama City will soon have a new metro system. A number of possible routes for the metro are now being discussed with the favored route running from Cinco de Mayo to San Miguelito. This route has been confirmed by the government but a final decision has not been made as to where the metro might begin and end. The project will be carried out in stages with the first stage covering about 14.5 kilometers at a cost of $1 billion. The really important question surrounding the new rail system is whether it will be a subway, monorail or light train system.
The metro project has the support of the Taiwanese and Brazilian governments who are offering credit as well as the Inter-American Development Bank and Andean Development Corporation. A Swiss-Mexican consortium is carrying out the design, consultation and bidding process for the new metro – they won the initial bid on the project in October 2009. The construction contracts will be awarded in July of 2010 with actual construction beginning sometime after that. The government of President Martinelli is determined to modernize the Panamanian transportation service and the new bus system combined with the new metro system will bring about much needed modernization.
The old U.S. Embassy on Avenida Balboa is about to be knocked down after 69 years. The old U.S. Embassy, which was not a favorite to most Panamanians, who thought it resembled something out of Fascist Germany, will be replaced by 70-story government office building – the building will be one of the tallest in Panama City. The new U.S. Embassy is located on the old Fort Clayton U.S. Army Base.
Panamanian Minister of Government and Justice, Jose Raul Mulino, announced the opening of a new naval base in Darien Province at Piñas Bay on the Pacific coast of Panama, just a few miles from the Colombian border. Mulino reported that the Panamanian government plans to open a new naval base every 3 months as a way of trying to stop the transportation of drugs through Panamanian waters.
Colombia and Panama are on track to sign a new trade agreement that will increase economic integration between the two countries. Currently Colombia exports about $319 million in goods to Panama. Panama exports about $147 million to Colombia, but those numbers will dramatically increase as trade tariffs and barriers are taken down with the new agreement. Traders in the Colon Free Zone are especially excited about the new agreement as they have lost access to their traditional export market in Venezuela because of the Chavez government.
The departure tax at Tocumen International Airport will increase on January 1st, 2010 from $20 to $40 per person. The increase will be used to modernize the airport, especially the construction of the Northern Concourse which will cost about $100 million. The increase will add an extra $60 million to the airport’s revenue. It’s estimated that about 4.8 million people pass through Tocumen International Airport every year.
The economic forecast for Latin America is very positive for 2010 according to the UN Economic Commission for Latin America and the Caribbean (ECLAC). It looks as though the region will see increased growth, especially Brazil which is expected to see 5.5% growth in 2010, Peru and Uruguay at 5% growth, and Panama, Chile, and Bolivia at 4.5% growth. Latin American economies have been slowly moving from manufacturing and industrialization back to commodity industries like mining, agro-business and oil and gas. Of course, China and India have begun to invest in Latin America in these high value commodity industries.
The Panamanian government has not announced what the increase to the minimum wage will be in Panama. The Panamanian minimum wage is currently $325 per month. Workers would like to see the minimum wage rise to $625, while business owners would like to see the minimum wage set at $360. The government wants something in-between; hopefully a number that won’t dramatically increase inflation.
Container traffic through the Panama Canal is down by 6.8% according to Panama Maritime Authority. The downturn is due to a global decrease in demand.
Panama’s foreign Minister Juan Carlos Varela traveled to Chile recently to deliver financial compensation to the families of Chileans that died a year and a half ago when a Panamanian government helicopter crashed into downtown Panama City killing the head of the Chilean police, Jose Bernales, among others.
The Breezes Resort at Santa Clara opened to guests this past month. Santa Clara has one of the best beaches on Panama’s Pacific coast. To see more on the resort Click Here.
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