*PANAMA: PRESIDENTIAL CANDIDATE CALLS FOR

C O N F I D E N T I A L PANAMA 000103 SIPDIS SIPDIS E.O. 12958: DECL: 01/31/2018 TAGS: PGOV PREL EFIN ECON ENRG ELAB SNAR KCRM PM SUBJECT: *PANAMA: PRESIDENTIAL CANDIDATE CALLS FOR CONSTITUYENTE Classified By: POLCOUNS Brian R. Naranjo. Reason: 1.4(d) -------------- Summary -------------- ¶1. (C) Asserting that Panama need "reinvention," Panamenista presidential nomination contender Marco Ameglio said he would call for a constitutional assembly (constituyente) during the first 18 months of his presidency to "redefine the republic." "Today, I am issuing a 20-month plan, not a 60-month plan (the length of Panama's presidential term),for how I will govern when I am elected," Ameglio declared on January 23. Speaking to the Panamenista Party's traditional rural and working class base, Ameglio's speech was considerably more populist than recent addresses made by fellow contenders Alberto Vallarino and Juan Carlos Varela His call for a constituyente was the last of series of proposals that included: the elimination of the CAIR, essentially an alternative minimum tax (AMT); the reduction in the cost of electricity by re-negotiating concessions; opening a public bid process to reform Panama City's public transportation system; and increasing investments in law enforcement to combat crime. While non-traditional leftist Panamanian groups, inspired by Chavez, make a constituyente a central element of their proposals, the center-right Panamenista Movement for Action (MAPA) and the respected president of Panama City tabloid "El Siglo," Ebrahim Asvat, have given the constituyente greater respectability. While he remains a long-shot candidate to secure the Panamenista Party's presidential nomination, Ameglio is the first mainstream candidate to call for a constituyente, thus moving this proposal into the "legitimate" political debate. It remains to be seen, however, how much resonance his constituyente proposal will have. End summary. -------------- "Charging Ahead (Voy de Frente)!" -------------- ¶2. (SBU) Adopting the mantra "Charging ahead (Voy de frente)!," Panamenista presidential nomination candidate Marco Ameglio laid out on January 23 a plan for governing should he be elected President. Noting that Panama needed a president who "will confirm and demonstrate his ability and sincere determination to change the country, not waiting for sixty long months of government during which that administration dilutes itself with lies and excuses and passing the blame to others," Ameglio said, "What I propose is very different. I present to you a proposal that will be executed and fulfilled in one third of that time, in twenty months." Ameglio then reviewed a series of proposals in the following areas: -- Gasoline and fuels: Ameglio called for cutting in half the tax on fuel, including gasoline. The impact of this tax cut would be financed with the "excellent" tax income generated by Panama's economic growth and by a "fiscal reform" that would "guarantee" better distribution of the GOP's tax income. Additionally, he said he would name a presidential advisor during his first 90 days to develop plans for alternative fuels, develop of new energy resources, and develop a national plan for efficiency and energy savings. -- Electricity: In the face of rising electricity costs and the growing threat of electricity shortages, Ameglio proposed reviewing and renegotiating concession contracts with electricity distributors and generators in the first six months in office. Ameglio asserted that the "state" would act as the consumers' representative. Furthermore, he proposed that the GOP re-purchase Fortuna, Panama's largest hydroelectric generator, to "reduce directly and in favor of the consumers" the price of electricity. -- Public Transportation: Also within the first six months in office, Ameglio said he would hold an international bidding process to implement a modern transportation system for Panama City. Such a system would be "based on the efficient use of electricity" and would cover the entire metropolitan areas. Panama's hydroelectric resources would power this electric public transportation system, "ensuring that transportation prices were kept low and that Panama would not depend on the high cost of imported fuel." -- Job Creation for Youth and Senior Citizens: During his first month as president, Ameglio said he would propose a "First Job" bill to support youth between the ages of 18 and 25 who had not previously worked. Under this legislation, private companies would be provided "attractive incentives" to hire new entrants into the job market. Also, he said he would create a Retired Executive Program through which senior citizens could earn additional income by providing advice to companies in need. -- Public Debt: During his first 18 months in office, Ameglio said he would go to the "financial organizations" to propose "reordering and refinancing" of Panama's public debt. Ameglio said his objective was to free up financial resources for greater investment in social services, particularly the fight against poverty. (Comment: This, despite the fact that the Torrijos Administration has done well to produce the GOP's first budget surplus in a decade to reduce Panama's debt-to-GDP ratio from about 70 percent in 2004 to approximately 54 percent today. End Comment.) -- Healthcare: Ameglio voiced strong support for a "unitary" healthcare system, but provided few details. Such a system would combine the healthcare services currently provided separately by the Ministry of Health and the Social Security Service (CSS). -- Education: Ameglio promised to increase, "by no less than five percent each year," investment in education. He would build new schools and recondition dilapidated schools. Additionally, he would build housing for students who needed to study far from home and install internet facilities in every school nationwide. -- Law Enforcement: During his first year, Ameglio would increase investment in law enforcement by five percent. Hiring an additional thousand police officers, Ameglio said he would also invest in training, equipment, and modern technology. Finally, he said he would improve the salary scale of the police. -- Tax Relief: During his first ninety days, Ameglio said he would eliminate the CAIR, an alternative minimum tax (AMT) that was highly unpopular with Panamanian middle class professionals. He asserted that the CAIR had been "expensive and unjust for small businessmen and professionals." -- Salary Adjustments: During his first sixty days, Ameglio said he would introduce a draft general law on salaries that would establish an annual mechanism to establish salary adjustments so that salaries keep pace with the cost of living. -------------- -- "Reinvent the Republic" Through a Constituyente -------------- -- ¶3. (SBU) In order to advance "true reform," Ameglio said that he would "convoke a constituyente as provided for in Panama's current constitution" within his first 18 months in office. The key objectives of this constitutional assembly would be: "to design a political system that guarantees greater citizen participation," to establish "a more expeditious and truly independent judiciary;" and to create a "legislature that is more representative, efficient, and capable of responding to the great expectations of the Panamanian people." -------------- The Crowd -------------- ¶4. (C) Absent from Ameglio's event were any A-list Panamenista luminaries. Politically, this night belonged to the B-list Panamenistas: mid-rank party bosses, former Moscoso-era mid-level officials and a few hundred average Panamenistas. Ethnically, in a country where darker skin complexion remains a significant indicator of social status, the crowd that Ameglio drew was primarily from the indigenous and Afro-Panamanian communities and included many average, darker skinned Panamanians of various mixed backgrounds. Economically, Ameglio's crowd was significantly more blue collar and middle class than events held by Varela or Vallarino. His programmatic offers were squarely aimed at addressing this segment of the population's major concerns: economic difficulties, law and order, and greater opportunity to share in Panama's economic boom. It will be interesting to see whether Ameglio's constituyente message resonates with this base that appears more concerned with bread and butter issues. -------------- Constituyente -------------- ¶5. (C) Unlike other countries in the hemisphere, Panama did not re-write its constitution after the restoration of its democracy following over twenty years of military dictatorship. Limited constitutional reforms have been made (e.g., outlawing Panama's military),but for the most part Panama's constitution remains the constitution established by dictator Omar Torrijos. While Bolivarian inspired leftists, mostly contained on the campus of the University of Panama, advocate for a Chavez-style constituyente, this kind of populist proposal has not gained traction. Seeing the political confrontation that has transpired in Venezuela, Bolivia, and elsewhere, Panamanians who generally prefer a more consensual style of politics prefer to steer clear of classist clashes. Also, the anti-globalization rhetoric that accompanies chavista-style politics is anathema for a country that literally lives at and off of one of the world's most important crossroads. ¶6. (C) Concerned about re-balancing Panama's presidential-centric political system, the Panamenista Movement for Action (MAPA),a loose gab-fab primarily composed of upper-middle and lower-upper class dentists and doctors with little political experience, have slowly gravitated over the past year and a half toward embracing a constituyente. MAPA leader Jorge Gamboa, a dentist, told POLCOUNS January 9 that a constituyente was the "only way to fix what is broken in Panama: the courts, the national assembly, the lack of decentralization." Gamboa and fellow MAPA leader Manuel Cambra, a physician, attended Ameglio's speech and were ecstatic at his constituyente proposal. Aware of the explosive connotation the word constituyente had in Latin America today, Cambra said on January 23, "We have to do this and do it in a Panamanian way. There is no other way to truly strengthen our institutions." ¶7. (SBU) Echoing MAPA's sentiment, the president of Panama City daily tabloid "El Siglo Ebrahim Asvat, a Harvard-trained attorney and President Torrijos' former advisor on strategic goals, wrote in his weekly column on January 14, "Every day I am more convinced that as a nation we need to travel down the road to a constituyente. I consider it the only way that we Panamanians have to guarantee ourselves the governmental structure in keeping with thetimes." Continuing, Asvat added, "This (current) centralized system of government and of the political parties is carrying us toward a kind of oligopoly of power where the political forces reach agreement to distribute power and to mete out the sinecures of public office." A constituyente would not be a cure-all, Asvat writes, but "would enable Panama to rebuild its political institutions." The work of a constituyente would be to "recompose" the judiciary and the legislature as well as to reform the civil service, determine the degree to which the state should intervene in the economy, strengthen the "guarantee for social rights, especially education, health, housing, and the retirement and pension system." -------------- Comment -------------- ¶8. (C) Ameglio is trailing badly in the race to win the Panamenista presidential nomination. His presidential aspirations are being crowded out by Juan Carlos Varela and Alberto Vallarino, both of whom are better funded and who enjoy significant political support from key sectors of the party. Nonetheless, Ameglio may have an impact on the race. His 20-month plan is a unique effort to enter into a "contract" with his supporters. Indeed, he released signed copies of his proposals that were published the following day in major newspapers. The content is aimed at what the voters tell pollsters are their most significant concerns: the economy, law and order, education, transportation, and healthcare. Many economists -- and his competitors for the Panamenista presidential nomination -- will take aim at the interventionist nature of his economic proposals. As for the constituyente, post will continue to monitor this concept that has migrated from Panama's non-traditional left, to the doctors and dentists of MAPA, then to the pen of a thoughtful and mainstream commentator and now to the proposals of a right-of-center politician. EATON