C O N F I D E N T I A L SECTION 01 OF 02 PANAMA 000975

SIPDIS


SENSITIVE


DEPT. FOR WHA/CEN/BRIGHAM


E.O. 12958: DECL: 04/26/2014
TAGS: PGOV PREL PINR PM POLITICS FOREIGN POLICY
SUBJECT: PANAMA ELECTION EVE OUTLOOK: LIKELY WINNER
TORRIJOS FACES A PROBABLE SPLIT LEGISLATURE


REF: A. PANAMA 0936

B. PANAMA 0924

C. PANAMA 0875

D. PANAMA 0802


Classified By: Ambassador Linda E. Watt for Reasons 1.4 (b) & (d)


Summary: Torrijos On Top
--------------


1. (C) Martin Torrijos and his Democratic Revolutionary Party
(PRD), well ahead by most indicators, are poised to win the
presidency and a plurality of legislative seats in Panama's
Sunday, May 2, 2004 general elections. The American-educated
Torrijos has marginalized the PRD's "old guard" and has shown
that he intends to work closely with U.S. officials,
especially on bilateral security and law enforcement issues
of mutual concern. Backed by a base coalition of nearly
one-quarter of Panama's two million registered voters,
Torrijos has a solid margin over his nearest competitor,
Panama's 1989-94 President Guillermo Endara. Endara, running
on the Solidarity Party ticket, and Arnulfista candidate Jose
Miguel Aleman, continue to compete for the anti-PRD vote.
Torrijos is a little known quantity in governing style; how
he will reduce corruption, for instance, is far from clear.
Embassy expects a free and fair election and will dispatch 28
volunteer observers throughout the country to watch it
develop. End Summary.


The Numbers Game: Final Installment
--------------


2. (SBU) Recent public opinion polls show Torrijos with a
substantial lead, followed by Endara and Aleman. They
probably correctly rank the candidates but do not reveal the
true margins between them. An April 20 La Prensa poll and an
April 22 El Panama America poll both show Martin Torrijos
well ahead of second-place candidate Guillermo Endara with
third and fourth-place candidates Jose Miguel Aleman
(Arnulfista Party) and Ricardo Martinelli (Democratic Change
Party) well behind:


Candidate La Prensa (4/20) El Panama America (4/22)
-------------- -------------- --------------
Torrijos 47% 45%
Endara 28% 27%
Aleman

19% 10%
Martinelli 6% 6%
undecided 0%* 12%


*La Prensa's poll was based on simulated voting by "probable
voters" who all cast "virtual ballots. Therefore, no one was
"undecided" in the results.


Legislative Head Count
--------------


3. (SBU) All seven of Panama's officially recognized
political parties will likely claim at least one of
seventy-eight total seats in Panama's unicameral Legislative
Assembly when it reopens on September 1, 2004. The PRD on
its own probably will not win an absolute majority of 40
seats. The PRD-PP electoral alliance could have a shot at
controlling the legislature, but the alliance may not survive
election day. Also, several likely PRD winners for
legislative seats are not loyal to Torrijos or other party
leaders. With several races too close to call, Emboffs have
identified the following probable outcomes:


PARTY # Legislators
-------------- --------------
Democratic Revolutionary Party (PRD) 33-38
Arnulfista Party (PA) 17-23
Solidarity Party (PS) 6-9
Natl. Liberal Republican Movement (MOLIRENA) 3-5
Popular Party (PP) 3-4
National Liberal Party (PLN) 3-4
Democratic Change Party (CD) 1-2


Comment: Wild Card?
--------------


4. (C) The wild card in this election is the actual extent
of support for ex-president Endara, who some observers think
could attract far more votes from undecided voters and
Panama's 100,000 government workers than opinion polls
suggest. Some interlocutors, including Endara's foreign
policy specialist and former Foreign Minister Jose Raul
Mulino, have suggested that if Endara were to win the
presidency, he would create a new party, attracting numerous
Arnulfistas. Emboffs expect the substantial Solidarity
contingent noted above to ride into the Assembly on Endara's
coattails, but quickly split rather than forming a unified
front. Most Solidarity legislative candidates were either
originally members of other parties or are newcomers to the
political scene.


Divided Conquerors
--------------


5. (C) A internal PRD struggle for positions and influence
in a new government may quickly become Torrijos' first major
challenge. Torrijos campaign finance manager Ubaldino Real
told POL Counselor April 1 that the Torrijos campaign team
has postponed showing its intentions on job assignments in a
Torrijos government. Real confided that the choices, once
announced, would surprise and anger Perez Balladares
supporters and others of the old guard. Although the
Torrijos inner circle is comfortable shutting out the old
guard after election day, Real denied that Torrijos would owe
political "debts" to them. Real, a management consultant,
explained that the campaign team had defined profiles for key
cabinet positions and had identified at least three people
who fit the profile for each one. He said that Torrijos
probably has names in mind for cabinet appointees, but added
that Torrijos has not shared them with anyone.


The young lions
--------------


6. (C) The emergence of young leaders like Torrijos and
Panama Mayor Juan Carlos Navarro, likely to be re-elected in
a landslide, has not purged the PRD of followers of former
President Ernesto Perez Balladares (1994-99) but it has
rejuvenated party membership and offers much better examples
to follow. Like their closest friends and advisors, Torrijos
and Navarro are US-educated modernists, well-versed in doing
business with Americans. If "change comes from the top" in
Panama's top-down political structure, their leadership from
positions of authority could greatly improve US-Panama
relations in the long run by improving governance in Panama.
But much will depend on how truly committed they are to
change, and how well they can keep the old Guard at bay in
the post-election scramble for plum positions in the next
government.


WATT