Panama Update Archives
Number 23, June/July 1998On March 23, Panamanian President Ernesto Pérez Balladares announced his intention to run for reelection. On May 18, the Panamanian Legislative Assembly approved a constitutional amendment permitting immediate presidential reelection, and set a national referendum on the issue for August 30, the final stage in legalizing his proposal. Since then, the debate over "immediate presidential reelection" (the reelection of an incumbent president) has taken over the public arena. A poll quoted in the New York Times showed the "No" side ahead with 57%, but support for the "Yes" is growing.Pérez Balladares' campaign thus far has focused on the "successes" of his first term, and the need to maintain his leadership position in order to complete his economic plan. The Panamanian president told people at a rally in Colón in May that those who could not appreciate his economic reforms were "either blind or idiots." On a trip to New York City the same month, he met with Citibank executives and spoke at a luncheon of bankers and investors hosted by the Chase Manhattan Bank-funded Americas Society, "promoting the country."
Earlier this year, the reelection movement's strategy had appeared to "marry" the question of the Multilateral Counternarcotics Center (CMA, by its Spanish initials) being negotiated bilaterally between the United States and Panama. However, the opposition of nationalist elements within Pérez Balladares' own Democratic Revolutionary Party (PRD) to the proposal, in addition to U.S. concerns with hinging the CMA's success in Panama on Pérez Balladares' own popularity, made this "marriage" politically unviable.
Despite the president's recent stalling of negotiations with the United States and apparently more nationalist stance, a split appears to be developing within the PRD. PRD supporters of former Panamanian President General Omar Torrijos' "popular power" policies announced they would meet on June 20 "to study the problems of popular power, the current political situation, and 'guarantee' the existence of Torrijo's works."
These consituents will most likely support the candidacy of Alfredo Oranges for president in the next elections, who began his campaign for the presidential primaries on May 1, promising he will "rescue the Torrijista project and make a more human government." Oranges lost the PRD's internal contest for the presidency to Pérez Balladares in 1993.
Opponents Speak Out
Opposition to Pérez Balladares' reelection proposal has come from various sectors of Panamanian civil society. The president of the Christian Democratic Party, Rubén Arosemena, voiced the concern of many critics that immediate presidential reelection would affect the independence of powers in the state, creating a facade of democracy in which the president would "control everything." La Prensa's Washington D.C. correspondent Betty Brannan Jaén has argued that in Panama's democracy neither the electoral process nor the concept of alternating power are well enough established for immediate reelection to be viable.
In late April, the Ngobe-Buglé Territory Coordination Council issued a resolution against Pérez Balladares' immediate reelection, saying reelection's goal was to strengthen the ruling party's power. The Council further criticised Pérez Balladares' labor code reforms, privatization of state companies, and increasing Panama's foreign debt as examples of anti-popular reforms enacted as part of agreements with international financial institutions. Panamanian organized labor has also announced its opposition to Pérez Balladares' economic policies and reelection campaign. Some critics say the incumbent president aspires to consolidate political and economic power for himself and his supporters with the turn-over of the canal area on December 31, 1999. Several opposition leaders have accused the PRD of illegally using state funds in campaigning for the August 30 referendum, despite restrictions defined by Article 30 of the Electoral Code and a recent decree by the Electoral Tribunal. MOLIRENA Assemblymember Arturo Vallarino accused the incumbent president of buying support by providing scholarships and creating an emergency plan in Colón that will generate 500 temporary jobs.
The political opposition has also been concerned with the possibility of electoral fraud. Opposition leaders have for months called for international monitors to be present during the August 30 referendum, and the Foreign Ministry finally issued an official request for monitors to the Organization of American States in the first week of June. The Electoral Tribunal has also requested an international presence and invited political parties and NGOs to bring their own observers.
Pérez Balladares' Economic Program
During his presidency, Pérez Balladares has worked to integrate Panama into the global economy. He has marketed the nation to international investors and lending institutions, privatized state-owned companies and properties, rented recently regained canal territory as concessions to mainly Asian investors, and "flexibilized" labor laws. He has held negotiations on bilateral free trade agreements with Chile, Mexico, and Costa Rica, and has expressed interest in joining the Andean Community trade block.
In late March, the World Bank issued a statement commending Pérez Balladares' progress, and calling for further reforms in this direction. The Interamerican Development Bank (IDB) has also shown confidence in his presidency, announcing investments in health, education, and social services, and in youth training programs, in order to prepare them for the "demands of the market." In early May, the Business Front of the PRD gave $5 million to his reelection campaign. Meanwhile, Pérez Balladares' relationship with the United States is less clear. While in New York, he received moral support from assembled financial leaders in his bid for reelection to continue Panama's development and integration into the world economy. On the other hand, the abrupt shifts in Panama's position and delays in negotiating the proposed CMA have led U.S. officials to indicate they do not trust him.
Domestic criticism of Pérez Balladares' economic plan has been strong. Government spokespeople point to increasing growth in the Panamanian economy, a relatively low cost of living, and low inflation, but unemployment continues around 13.7%. Panamanian businessman Juan Planells pointed out recently that while the current level of unemployment appears stable, it is maintaining itself only through new investments that counteract the effects of privatization and downsizing, which will be unsustainable in the long run. Current levels of unemployment are allowing the growth of poverty and extreme poverty in the country. This threatens national development, creating a cycle in which a lack of employment leads to unskilled workers, leading to their inability to find work and contribute to the economy.
In spite of reforms designed to encourage international investment in Panama, Colgate-Palmolive recently announced plans to close its Panamanian operations. General Secretary of the Central Labor Union Mariano Mena called on the Labor Ministry to deny Colgate-Palmolive's request for authorization to lay off 205 workers in October of this year, since it had not fulfilled the legal requirements for closing operations. He worried that a weak stance by the government in this case may encourage more transnationals to follow suit.
Reelection Campaigns in the Region
Like Panama, "most Latin American countries barred presidential reelection in the 1980s following transitions to civilian rule, but Argentina, Peru, and Brazil have [already] amended their constitutions to allow an additional term," according to the Resource Center of the Americas. These leaders have followed similar patterns, instituting what some analysts have called civil-authoritarian models of leadership, while following development plans favored by international lending institutions, suggesting a tendency in the region.
After forcing changes in the Peruvian constitution in order to hold office for a second term from 1995-2000, President Alberto Fujimori now plans to seek reelection to a third term, claiming the 1993 constitution which allows one reelection still applies to him. The Constitutional Court has supported this position, and court justices who dissented were subsequently dismissed. On May 29, the Democratic Forum, a collective of groups opposed to Fujimori's reelection bid, announced it had collected the 1.2 million signatures necessary for a referendum to nullify the law which allows him to seek reelection.
In the course of his tenure, Fujimori has complied with the demands of the new world economy by reducing tariffs and other forms of trade protection, "flexibilizing" the market by further eroding workers' rights, privatizing most state companies, and lifting controls over foriegn investment. While hyperinflation has been controlled and growth encouraged with the help of the International Monetary Fund, World Bank, and IDB, the number of Peruvians below the poverty level has increased, and Peruvian society has seen increasing disparities of income distribution.
"In 1988," says the Peru Support Group, "the [Peruvian] armed forces elaborated a document known as the 'green book,' which put forward the view that a neoliberal 'revolution' could only be achieved in Peru if underpinned by a stable and enduring government with full military support, lasting for as long as 15 years if necessary." Fujimori turned to the Peruvian military for support during the palace coup of 1992, and the hostage crisis of 1997. Peruvian opinion polls rate Vladimiro Montesinos, the head of the National Intelligence Service, as the most powerful man in Peru.
Argentine President Carlos Saúl Menem is also seeking a constitutional ammendment to allow him to run for a third term -- an intention he announced March 14 -- despite low popularity ratings. Through the course of his presidency, Menem has sold off state water, electricity, gas, and telephone services totaling close to $30 billion, while the country's debt has doubled. In addition, 500 Argentine-owned companies have been sold to transnationals, the largest foreign buyer being U.S.-based Citicorp Equity Investment. This trend has been encouraged by new labor laws that reduce job stability and wages. The International Monetary Fund has required the adoption of a new labor bill by July 1998 in order for the country to receive new credits.
Sources: La Prensa 3/23, 3/30, 4/1, 4/5, 4/6, 5/6, 5/17, 5/19, 5/20, 5/24, 6/1, 6/8; El Panamá América 5/10, 5/27, 6/6, 6/8; Connection to the Americas, 4/98; CNNenEspanol 5/29; New York Times 5/29; Los Tiempos del Mundo 5/28; Panama News 5/22; Consejo de Coordinación Comarcal y Congreso General Ngobe-Bugle Resolución #3, 4/27; Peru Support Group Briefing, December 1997; Rolando Ames and Susana Villarán presentations at Peru Peace Network meeting, 2/98.