PANAMA CITY MAYOR PESSIMISTIC ABOUT CANAL

UNCLAS PANAMA 001072 SIPDIS SENSITIVE SIPDIS DEPARTMENT ALSO FOR WHA/CEN, INL AND INR/B SOUTHCOM FOR POLAD E.O. 12958:N/A TAGS: PGOV PREL PINR PM SUBJECT: PANAMA CITY MAYOR PESSIMISTIC ABOUT CANAL REFERENDUM SUMMARY -------------- ¶1. (SBU) During a brief but intense conversation on May 22, Panama City Mayor Juan Carlos Navarro told Emboffs that possibilities for the GOP to win a potential Canal referendum in 2006 are close to null. Navarro, a usually cheerful and positive character, was pessimistic when explaining why he, and many Democratic Revolutionary Party (PRD) members and GOP officials, believe President Torrijos will embarrassingly fail in getting a "yes" vote in the yet- to-be scheduled Canal widening referendum. Navarro cited poor political strategy, including clumsy political patronage on one hand, and unemployed and disgruntled party members on the other. For example, he criticized GOP slowness to repair local social and infrastructure problems. In his frustration Navarro feels that the Canal referendum may have to wait. End summary. Torrijos Pays No Attention -------------- ¶2. (SBU) Navarro claimed that last March while flying together to the western province of Chiriqui, he told President Torrijos of his concerns about the possibility of losing the Canal referendum. According to Navarro, Torrijos was surprised by his worries and ignored him. PRD board members Balbina Herrera, Hector Aleman, and Navarro began making field trips to meet local PRD leaders to survey them on the referendum. Navarro said that the group issued a detailed report for Torrijos explaining internal PRD disenchantment with his government and suggesting solutions, but Torrijos has taken no action yet. Ham-handed Patronage Committee -------------- ¶3. (SBU) One of the suggestions included in the report was to give jobs to key unemployed party leaders, which Navarro thought could be easy to do. "We would only need to hire around 2,500 more people but nothing has been done," Navarro complained. Early in his administration, Torrijos established an unofficial committee ran by his personal friend Felix "Pille" Gonzalez to screen and approve new GOP/PRD hiring. Navarro confided that Torrijos once complained that the GOP had already hired 40,000 people but that he couldn't "find them." Navarro wondered if those 40,000 PRDs were the right ones to hire and stated that the patronage committee is feathering its own nest. For instance, two Cortizo siblings still hold GOP jobs, despite their brother Laurentino Cortizo's public resignation as Agricultural Minister on the eve of the FTA's ninth round. Cortizo's flamboyant walkout embarrassed Torrijos but most importantly ruined the conclusion of the FTA, a firm GOP goal at the time. Unreasonable Expectations -------------- ¶4. (SBU) Navarro claimed that Cocle provincial PRD Governor Dario Fernandez recently confided his increasing worries about having to promote the referendum in his province when their own party members were not behind them supporting the cause. Lack of much-needed infrastructure solutions concerns Navarro as well. "How do they expect our people to go to the communities and ask them to vote with us? The people will ask `where is the bridge you promised us?'" Navarro stated. Many rural communities in Panama face the same problem. Navarro believes that it is already "too late" to think that small social projects would prompt a "yes" Canal expansion vote. Even the $50M that the GOP put aside last January for this purpose won't help, he said, and "anyway, where are those $50M? I haven't seen it!" Navarro added. Running for president -------------- ¶5. (SBU) Navarro, who confirmed that he will run for the sensitive but largely ceremonial job as PRD president in 2007 and for PRD presidential candidate during the party primaries in 2008, shared with Emboffs that his campaign team is actively polling his presidential possibilities. He told Ambassador that President Torrijos is supporting his candidacy for PRD president. He also told Ambassador that Torrijos had promised to support his candidacy for President of Panama in 2009 if Navarro supported his candidacy in ¶2004. Waiting Is Better Than Losing -------------- ¶6. (SBU) Navarro's polls show anti-Canal referendum sentiment increasing and the "yes" supporters losing territory. The polls, Navarro claimed, are nationwide and use a sample of 1200 people. Navarro's concerns increase when asked what happens if the referendum fails. "The GOP would become a lame duck. The GOP is at stake, the party is at stake, I am at stake," Navarro remarked, adding that if polls continue to show the "no" vote growing, then it would be advisable not to hold the referendum in 2006. Navarro believes that Torrijos made a mistake by holding a big, splashy event to launch the Canal expansion project. By holding the event and giving a speech, Torrijos politicized the project. Navarro considers that it should have been a Panama Canal Authority event instead and that delaying the referendum is a reasonable option to avoid losing it. COMMENT -------------- ¶7. (SBU) Navarro's feelings reinforce those of opposition legislators who have told Emboffs that winning the referendum is becoming more questionable as days go by. Inevitably any referendum in Panama becomes a test of the government's popularity. Lack of governing party unity is bad enough. But added to increases in energy and transportation costs, a worsening crime rate, and higher income and property taxes threaten the referendum. Panamanians may "punish" the GOP via the referendum. Eaton