Not just a canal, but a keystone

The bridge nation speaks up

Earlier in the month the Panamanian president, Ricardo Martinelli, gave a talk at Canning House (, @Canning_House) in London called ‘Panama and Central America: Challenges and Opportunities’.


Mr Martinelli spoke at length and was questioned afterwards on the more difficult topics. The president has Italian roots and he was keen to point to them in the talk, spending nearly half his speech praising immigration to the country and the economic benefits of foreign fingers in the Panama City pie. He told us that 7% of the population was from the US but he also stressed that his nation must not to be seen as a tax-sanctuary and that overseas citizens had pay their homeland due as well as the Panamanian ones.

Martinelli eulogised about his 2% budget deficit and national high standard of living and claimed the only rival to his country in Latin America for economic competition was Chile. He boasted of the 12% growth forecast for next year. He assured the collected that he would try hard to save Panama from becoming embroiled in the financial crisis: “we are almost immune, through being so far away and not relying on one commodity or product.”


Panama is famous for its canal but Mr Martinelli admitted that widening and modernising works were behind schedule. He confirmed the companies involved would lose their cash incentive if they miss the July deadline, (which he confessed was likely), saying “the impact on the economy would be great.” He wanted to show us that there was more to the country’s infrastructure than the inter-oceanic waterway and highlighted the investment in rapid building of cruise-liner ports and the improvements to the capital’s public transport system he had approved.


After his talk, the president was pressed on slightly less comfortable issues than easy national promotion and talk of bilateral trade deals. I wanted to steer him towards talking about his neighbours and pointed out that Nicaragua had recently re-elected Daniel Ortega after the president’s party had secured a modification to the constitution. When Manuel Zelaya, the former Honduran leader, had tried that in his country in 2009 the army flew in during the night and carted him off to Costa Rica. And the intentions of Hugo Chávez, the Venezuelan head-of-state, are clear: he would like to stay in power until 2031.

The response of Mr Martinelli was also simple: he is not in favour of re-election – “you should go home after one term”. He was at pains to point out that he was not describing the situation in Nicaragua, but he saw being voted back into office and changing constitutions to allow re-votes as undemocratic moves in a (largely) growing region of democracies. Re-election is outlawed in Panama and Martinelli confirmed it would remain so.


He was also pushed on tax treaties, eco-tourism (a field in which Costa Rica has done particularly well) and security, the most worrying topic in the region. Panama is the link between the north of South America, where the internal problems with criminal gangs are largely subsiding (although international cocaine production continues) and Central America. Here the murders, extortions and abductions are worsening, especially in the ‘Northern Triangle’ of Guatemala, Honduras and El Salvador.

Panama is a transit country, with gangsters flying over it to land in jungle airstrips or sailing along its mosquito-riddled coasts, bubbling through the mangrove swamps in mini-submarines or speedy launches on their way to Mexico. Martinelli was adamant that his country would not be put at risk by encroaching gangs and outlined the security measures – namely the training of more police and the expansion of surveillance procedures – he was taking to ensure his people (and the foreigners and their multi-billion-dollar businesses in Panama City) were safe.

Mr Martinelli’s country is going places but it needs to shout its little voice louder on the regional stage to confront this problematic issue of criminal violence with its Latin partners. The rising violence is a disease that is borderless that requires international treatment. That Panama is comparatively successful is good for the region but Mr Martinelli must not solely focus economic efforts on the foreign-dominated capital. He must remember the villages and small-holders of the countryside. But he is not doing badly.

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