Tourism Minister Visits Playa Blanca - Makes Headlines
Saturday, February 05 2011 @ 07:18 PM EST
Contributed by: Don Winner
Panama's Tourism Minister Salomon Shamah explained to the 100+ gathered residents of Playa Blanca that the garbage dump at Rio Hato will be closed and moved within four weeks.
The Dump Is Going To Be Moved: Minister Shamah explained that the land where they intend to locate the new dump was owned by the Ministry of Education, and it took some doing to get them to release ownership of the land to the Municipal offices of the Mayor of Anton so they could start using the location for the new landfill. He said there were many other delays, snafus, and inter-agency coordination problems, all within their administration. However, he said all of those things have been worked out. He flat-out promised that the dump would be moved and gone no later than 15 March 2011. He explained that they have a four week implementation plan which includes moving much of the existing heaps of garbage to the new site, putting pipes into the ground to allow for accumulated gases to escape, and a "massive" fumigation effort once the dump has been cleaned up and closed. He said they would be moving much of the garbage, and then burying the rest. The total budget for this operation is $500,000 dollars. Of that $100,000 was donated by the local hotel owners and the rest comes from the ministries of Health, Tourism, and Pubic Works. So anyway, that was the good news. Now let's see if they actually follow through with their promises and within the time frame specified.
What About Bed and Breakfasts? After he finished his presentation I had a chance for a quick one-on-one interview. I just ran through what I already knew about the dump thing, the money, the time frame, etc. I also let him know about a tip I had just received - that apparently a Frenchman (tour boat operator) had been found killed in Portobelo - and he immediately called his people there to have them check it out, because prior to me telling him about the body being discovered, he had not heard a thing. Then I moved on to meatier fare. Earlier this week someone had posted some questions about running a Bed and Breakfast operation in Panama. The last run-in I had with Minister Shamah was back towards the end of 2009 over short term executive rentals, and this B&B thing was sort of down the same alley. Anyway, since I had a crack at the minister, I bounced it off of him to see what would stick. I was surprised by the turn of events. The conversation went like this...
- Panama-Guide: I know that in Panama there are several types operations where tourists can stay, such as hostels and hotels. Recently someone contacted me about running a Bed and Breakfast...
- Shamah: Those are illegal, they are outside of the law. We have done many studies and it has been proven that these people don't make the same kind of investment as a regular hotel operator. The law does not contemplate, nor allow, these kinds of activities.
- Panama-Guide: I know there are many different categories within which people can legally operate...
- Shamah: This is a very complicated topic and we could talk about this for five hours or more, but the fact is that these kinds of short term rental activities are not allowed, and they fall outside of the law.
- Panama-Guide: OK, but it could. Is there any chance of making a change to the law to allow for this kind of activity?
- Shamah: No, absolutely not.
- Panama-Guide: Why not?
- Shamah: Because it does not have the approval of the Minister. (Meaning, him.)
- Panama-Guide: Well, you know that these things are hard to stop, and people are probably just going to keep doing it anyway...
- Shamah: We're going to be passing a new law in March to regulate this. The new law will contain sanctions and fines for those who insist on continuing these kinds of activities. Wait until I have my fine book in my hands, and when I can start sanctioning people, then we will see how long they keep it up...
- Panama-Guide: When will this new law be passed?
- Shamah: Next month, in March.
- Panama-Guide: I would like to make an appointment to come by your office sometime to discuss this issue at length. Would that be possible?
- Shamah: Yes, of course - just make the appointment with my assistant.
And Now, The Rest Of The Story: I don't think Minister Shamah realized who I was until I started asking him about Bed and Breakfasts, and all of a sudden his memory kicked in and went back to a time much earlier in his administration when he issued a simple resolution that had the affect of changing all property ownership laws in Panama. The legal impact of his seemingly simple ATP resolution made it instantly illegal for anyone to rent an apartment for a term shorter than one year. Any property owner could rent their property, but there had to be a contract registered with the Ministry of Housing (MIVI.) Anyone who wanted to stay for less than one year had to stay in a hotel. Period - no middle ground to allow for any kind of shorter term rental. The whole thing when on for a couple of months, but then eventually he had to issue another resolution which rescinded the first resolution. In short, he folded his cards and retreated in defeat. See these related articles from the fall of 2009:
- Short Term Apartment Rentals Now Illegal in Panama - 31 Aug 2009
- Serious Problems With ATP's New Restrictions on Short Term Rentals - 1 Sep 2009
- Panama's Tourism Administrator Salomon Shamah Kills Carnival in Las Tablas... - 4 Sep 2009
- ATP Resolution 52 Published in the Gaceta Oficial (It Now Has The Effect of Law) - 8 Sep 2009
- ATP Suspends One Resolution By Issuing Another - 8 Sep 2009
OK, So It Really Only Took Nine Days: From the time that I found out about the new ATP resolution to they themselves killing it was nine days, total. It must have been a classic Homer Simpson "Doh" moment when they slowed down long enough to realize the far-reaching implications of what looked like just a simple memo on the surface. They finally realized that no, the Minister of Tourism does not have the power and authority to change all private property ownership rights in Panama with the stroke of a pen. At least they got there quickly, and made a fix - mostly because they had to.
I Sense Another Try: I am pretty sure that I know what Minister Shamah is planning to do. A couple of things are crystal clear. First of all, he is 100% - absolutely - on the side of the big hotel owners. That's exactly why this "move the Rio Hato dump" thing was such a down hill slide. The government is doing it because the hotel owners want it to happen - not because a handful of gringo beach front condo owners made a couple of headlines in the local newspapers. Of course that helped, and in his presentation today Shamah said those protests were the catalyst which pushed the deal over the top - but he got behind it because the hotel owners are behind him. I think this law that he's talking about getting passed in March will be an attempt to put into legislation what he failed to get through with his ill fated resolution.
Say What? Most of the people who were applauding Minister Shamah's support for their requests to have the garbage dump at Rio Hato moved probably had no clue that his next trick will be to make it illegal for them to rent their vacation properties for short term customers. Many of the people who were there today either own several apartments or condominiums in Playa Blanca, or they are snow birds who use their properties when Canada is under eight feet of snow and ice, and they rent them out during the other months of the year. If Minister Shamah and the hotel owners get their way, then that activity will become illegal.
I Have No Idea What The Draft Bill Actually Says: Much of this is pure speculation on my part, admittedly. I will make an appointment with Minister Shamah next week to discuss this topic again, at length, and I'm acutely interested to know what he's planning to present to the National Assembly. But judging by his first run at this back in September 2009, and the statements he made to me today - I suspect my radar is tracking pretty closely at this point.
Don't Bother Telling Me It's Stupid: I already know. A much better approach, in my humble opinion, would be to find a way to authorize, register, and tax things such as short term apartment rentals, short term executive rentals, and Bed and Breakfast operations. These are in fact individual owners and each one is a kind of micro-business, some more organized than others, and it is a basic and fundamental law of business that more options, choices, and opportunities generally leads to lower prices, more competition, free enterprise, and a more attractive array of selections for places to stay when a tourist comes to Panama. He might stay at an executive apartment in Panama City for a week, then hit Decameron or some other all-included resort, swing up to Boquete to stay at a nice quaint B&B in the mountains, and then pop over for a cool little place somewhere in Bocas. There are ways to manage all of these different kinds of options - and more options means more tourists.
There Are 45 New Hotels Under Construction: Did you realize that right now there are about 45 new (big) hotels under construction, just in Panama City. The number of hotel rooms available is about to jump sharply, and predictably these people who have invested millions of dollars in infrastructure are going to be lobbying hard for the government of Panama, namely - Salo Shamah - to pinch off the other non-traditional options to drive paying customers to fill their hotel beds.
Like Herding Cats: The hotel owners are organized and concentrated. Just a few of them can represent a huge amount of income for the government of Panama in the form of taxes. However, on the other hand, the dozens if not hundreds of individual property owners who currently rent their properties in the short term are split, divided, geographically separated, and not represented by one organization or under one umbrella. Therefore, the hotel guys will win if things remain as they are now. And, importantly, it is abundantly clear that Salomon Shamah is already 100% in their camp.
So, Here We Go Again: Obviously this is the first warning shot of what will probably evolve into a much larger story. Just remember (as usual) you heard it here first. I'll keep learning more and I'll let you know what's going on as I figure it out myself. And oh yeah, the dump at Playa Blanca is apparently history, so at least that's some good news. The other stuff, not so much.
Copyright 2011 Test and Photos by Don Winner for Panama-Guide.com. Go ahead and use whatever you like as long as you credit the source. Salud.