Identifier
Created
Classification
Origin
06PANAMA1842
2006-09-20 15:35:00
UNCLASSIFIED
Embassy Panama
Cable title:  

NATIONAL DEVELOPMENT PLAN: REALITY OR GIMMICK?

Tags:  ECON ETRD 
pdf how-to read a cable
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R 201535Z SEP 06
FM AMEMBASSY PANAMA
TO RUEHC/SECSTATE WASHDC 8984
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE
UNCLAS PANAMA 001842 

SIPDIS

SIPDIS

DEPT FOR WHA/CEN TELLO

E.O. 12958: N/A
TAGS: ECON ETRD
SUBJECT: NATIONAL DEVELOPMENT PLAN: REALITY OR GIMMICK?
THIS MESSAGE IS SENSITIVE BUT UNCLASSIFIED. PLEASE HANDLE
ACCORDINGLY.

REF: PANAMA 1782

UNCLAS PANAMA 001842

SIPDIS

SIPDIS

DEPT FOR WHA/CEN TELLO

E.O. 12958: N/A
TAGS: ECON ETRD
SUBJECT: NATIONAL DEVELOPMENT PLAN: REALITY OR GIMMICK?
THIS MESSAGE IS SENSITIVE BUT UNCLASSIFIED. PLEASE HANDLE
ACCORDINGLY.

REF: PANAMA 1782


1. (U) SUMMARY. Hoping to boost the odds of a favorable
outcome on the October 22 Panama Canal (Canal) expansion
referendum, President Torrijos on August 16 announced plans
to hold a national dialogue for establishing a national
development plan (NDP). Support for an NDP enjoys broad
support across Panama's political spectrum and numerous
political, business, labor and civic groups have made an NDP
one of their key demands. Although business and political
parties have responded cautiously to the announcement,
calling it overdue and necessary, Torrijos' announcement is
nonetheless viewed widely as simply an attempt to garner
support for the Canal expansion. Almost no one expects a
meaningful NDP to be completed within the next two months.
End Summary.

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GOP Links Referendum to a National Development Plan
-------------- --------------


2. (SBU) In a hastily organized August 16 event, Torrijos
announced the start of a national dialogue on an NDP. No
details or outline of such plan were discussed. Torrijos'
first mention of an NDP was made on August 12 when he said he
would hold a meeting to establish the framework for a Pact of
National Coordination on Development. Prior to August 12,
Torrijos resisted efforts to engage in any NDP dialogue until
after the October 22 referendum. Torrijos acknowledged he
was responding to political, business and labor leaders' call
for an NDP in connection with any Canal expansion. Torrijos
asked the United Nations' Development Programme (UNDP) to
organize the national dialogue, something he now referred to
as a matter of state. UNDP representative Jose Eguren said
on August 21 that he would begin consulting with various
civic leaders to begin formulating the process for the
national dialogue. On August 31, Eguren told Emboffs that he
believes Torrijos genuinely wants to pursue the NDP. Eguren
did not believe the GoP would risk harming its relationship
with the UN by enlisting UNDP's participation in a token
process aimed solely at achieving a political win. Torrijos
also named Enrique Iglesias, former Inter-American
Development Bank President, to supervise the national
dialogue.

--------------
Mixed Reaction to NDP Announcement

--------------


3. (U) An NDP has been a central demand of certain political
parties and business groups. Juan Carlos Varela, President
of Partido Panamenista, the country's second largest
political party, told Ambassador on August 29 that voter
approval of the expansion would be difficult without the GoP
concurrently outlining an NDP, that it would be impossible to
conclude such a plan by October 22, and that therefore it
would be best to postpone the referendum for two to four
months. Varela said people in the interior are inclined to
vote "no" because they were concerned with decentralization,
security, education and inflation. Varela told Ambassador
that Torrijos could demonstrate that he was a "statesman" and
lift the canal debate above political partisanship if he
advanced a serious NDP and postponed the referendum to allow
for a full discussion of an NDP.


4. (U) Members of the Panamanian Business Executives
Association (APEDE) told EconOff that they regret having
given their unconditional support to the expansion. They
asserted that they had not received anything in return.
Members told EconOff that they should have withheld their
support in exchange for a GoP commitment to develop an NDP.
APEDE was one of the early supporters of the expansion,
hosting a nationally televised town hall meeting featuring
the Panama Canal Authority's (ACP) Administrator and various
members of its senior management. After the Torrijos
announcement, APEDE's ex-President Enrique de Obarrio said
that the important thing was to have a thorough debate on
development and ensure mechanisms were in place to monitor
the expansion project.


5. (U) The Colon Free Zone Users' Association, while an
expansion supporter, also sought an NDP. At an August 8
event in Colon attended by Torrijos, Users' Association
President Severo Souza said the association supported the
expansion not because it was needed, but because it would
increase economic activity and the increased revenues
received by the GoP could go towards social and economic
development plans.



6. (U) Although National Liberal Republican Movement
(MOLIRENA) President Gisela Chung said the national dialogue
was long overdue, her party nonetheless announced its
opposition to the expansion on August 27. Neftali Jaen,
representative of the expansion opposition group Grupo
Independiente por el No, said the group was open to
supporting the expansion after Torrijos' announcement but
cautioned that the ideal would be to delay the referendum
until the NDP national dialogue was concluded. Ricardo
Martinelli, Partido Cambio Democractico's President, said the
NDP should be included in the constitution. Radical
political movement, the National Front for the Defense of
Economic and Social Rights (FRENADESO),claimed the Torrijos
announcement was politically motivated and refused to
participate in any NDP discussions.

-------------- --------------
Canal Expansion Advocates Fail to Connect on Social Issues
-------------- --------------


7. (U) Illustrative of the linkage between the expansion and
the concern over the state of the country's infrastructure
was a forum held by the Smithsonian Tropical Research
Institute (STRI) discussing the environmental impact of the
expansion. STRI scientist Stanley Heckadon acknowledged the
expansion would have some minimal environmental impact, but
maintained that it was environmentally viable. However,
during the question and answer session, almost every question
focused on problems with Panama's water and sewage system.
Many questioned why so many areas have no potable water or
adequate sewage systems. At the end of the event, two
individuals who claimed to have been undecided said they were
now against the expansion because the country needs first to
address the issues of water management and urbanization.
This scene has been repeated in numerous events attended by
EconOff in recent weeks. ACP officials have been bombarded
with questions regarding social spending, education,
unemployment and poverty. ACP members usually attend these
events without officials from other GoP ministries and are
left to respond to many questions that are outside the ACP's
competence.

-------------- --------------
Comment: NDP Efforts Unlikely to Win Over Skeptics
-------------- --------------


8. (SBU) Torrijos announced the NDP effort when the GoP was
especially nervous about the referendum. The GoP appears to
be seeking support in any way possible. The public's desire
for an NDP is founded both on the lack of faith in the GoP to
use Canal revenue's for the general good and a fear the GoP
will use Canal revenues to bolster the ruling Democratic
Revolutionary Party's dominance. Both supporters and
opponents of the expansion want the NDP to specifically
designate to which programs Canal revenues will be allocated
in order to mitigate the GoP's ability to misappropriate
funds. With only about a month before the referendum, a
meaningful NDP cannot be completed in time. To date, there
has not even been an agreement as to a timetable or outline
for the NDP national dialogue. Even Torrijos has
acknowledged that an NDP cannot be finalized before the
October 22 referendum. At best, we may see some agreement on
the allocations of Canal revenues to certain social and/or
infrastructure programs. While Torrijos himself remains
popular and the most recent poll suggests the "yes" vote has
gained momentum (REFTEL),the principal objections to the
expansion revolve around lack of faith in the GoP, the
inability of the GoP to use Canal revenues to improve
infrastructure and address social ills, and a deeply-rooted
mistrust of the government.
ARREAGA