Power Shift in the Legislature

On 1 Sep, the Democratic Revolutionary Party (PRD) lost the control of the Legislative Assembly that it had enjoyed for the previous two years, when PRD dissident Carlos Alvarado was elected by a vote of 40 to 31 as president of the Legislator with the backing of the ruling Arnulfista Party (PA) and nine other legislators. Also elected were two vice presidents, Alcibiades Vásquez (PA) and Alberto Magno Castillero of the Solidarity Party.

The PRD, the nation’s major opposition party, now with only 31 supporters in the National Assembly, is showing obvious signs of internal dissention. Founded during the dictatorship of the late Gen. Omar Torrijos in an effort to strengthen and perpetuate his rule, the PRD is now led by Torrijos’ son, Secretary General Martín Torrijos, who expects to be the PRD’s presidential candidate for the national elections in ’04, although he ran for the presidency and lost in ‘01. Another loss in ’04 would push Martín and the PRD further downhill politically.

To show its displeasure with Alvarado, the PRD is seeking to expel him from the party’s ranks, along with two other dissident PRD legislators—Carlos Afú and Tomás Altamirano—who also supported Alvarado’s bid for the presidency of the Legislature. Although the PRD maintains its legislative pact with members of the Popular Party and the Solidarity Party, overall its legislative power has declined by nine votes—the three PRD dissidents in addition to six legislators of other political parties who supported Alvarado’s candidacy. It was the defection of PRD and Solidarity Party members that led to Alvarado’s win and a victory for the Arnulfístas.

President Mireya Moscoso (PA) now has control of the three branches of government—the Executive, the Legislative and the Judicial—for the first time, and she may now have the power to win approval of tax reform measures that the International Monetary Fund (IMF) has “suggested” would be necessary for Panama to qualify for additional IMF loans that the nation needs to improve its economic stability. During the past two years, the PRD and its supporters have blocked tax reform legislation from being passed. Now, Moscoso hopes to win quick approval for her proposed ’03 national budget without any serious modifications by the Legislative Assembly, as well as for other proposed legislation that favors the PA’s own political interests.

Chiquita Brands May Close Its Pacific Operations

On 13 Sep, the Board of Directors of the U.S. transnational Chiquita Brands (based in Cincinnati, Ohio) warned the government that it might have to close one of its two major production facilities in Panama in Dec, if the company is unable to improve banana quality and its overall productivity. At risk are the banana plantations in Chiriquí Province on the Pacific Coast, near the Costa Rican border.

Chiquita Brands, which operates about 67% of the nation’s banana plantations and employs approximately 3,000 workers, experienced $90 million in losses in Chiriquí Province during the past five years for a variety of reasons: poor weather conditions, a series of labor boycotts, an increase in labor and production costs, and a decline in Chiquita banana sales on the world market, specifically to countries of the European Union, because of import restrictions.

Overall, the exportation of bananas from Panama during ’02 has declined by 50% (about 21 million boxes a year) compared to ’90, and income from banana sales has dropped by $100 million a year, reported the Ministry of Commerce on 16 Oct.

On 17 Sep, the Puerto Armuelles Fruit Company (PAFCO), a subsidiary of Chiquita Brands, announced that it is willing to dialogue with the government and its workers “in search of a solution” to avoid having to close down its production facilities on the Pacific Coast. However, PAFCO representatives warned that “the time is short” and that the government and the workers must work together to find a viable solution prior to Dec. If not, then Chiquita Brands will probably cut its losses in Panama and invest elsewhere. Possible solutions include the creation of one or more cooperatives in order to improve labor relations, cut production costs and improve the quality of the fruit produced.

PAFCO claims that its high production costs are the result of having to: (1) pay higher wages to avoid labor boycotts; (2) pay for the high cost of irrigation due to a decline in the average rainfall; and (3) provide its workers with housing, electricity and water. The company argues that in Costa Rica and Colombia the government provides these services to banana workers. Consequently, PAFCO has experienced the loss of competitiveness of its product on the world market. The cost of producing one box of bananas in Panama is about $8, whereas the sale price in U.S. supermarkets is $5 a box, according to company spokesmen.

While the government of Panama has stated that it is “trying to work things out” to avoid the closure of PAFCO, labor union representatives have stated that the workers are unwilling to give up their hard-earned benefits and will not renegotiate their labor contracts.

100 years of Nationhood Celebrated

The ceremonial raising of the national flag on Ancon Hill on 1 Nov, overlooking the Pacific entrance to the Panama Canal, marked the beginning of activities for the Centennial Celebration of the Republic of Panama, which was born in 1903 when the Province of Panama declared its independence from the Republic of Colombia with the support of U.S. gunboats.

Regardless of the historical events that led to the U.S. military intervention and subsequent acquisition of the Panama Canal Zone and the building of the inter-oceanic canal by the U.S. Panama Canal Commission, the people of Panama are proud of their nationhood and have begun to celebrate their political, economic, social and culture heritage. On 13 Feb, the mayor of Panama City formally installed the Centennial Celebration Commission, which has worked with leaders of government, business and private institutions to plan a series of activities that will be held during the coming 12 months, from Nov ’02 to Nov ’03.

—Clifton L. Holland