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Thursday, April 24 2014 @ 01:48 AM EDT

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Panama president blames former canal chief for crisis

Canal ExpansionPanamanian President Ricardo Martinelli Monday blamed the Panama Canal's former administrator for the current crisis surrounding its massive expansion project -- where work has been halted over a billion-dollar payment dispute.

Martinelli said Alberto Aleman Zibieta was "responsible for what has happened," referring to the row over who will cover $1.6 billion in cost overruns in the project to enlarge the 80-kilometer (50-mile) waterway linking the Atlantic and Pacific oceans.

Aleman Zibieta, a Panamanian engineer, was in charge of the independent Panama Canal Authority in 2009 when it awarded the largest contract in the expansion project -- worth some $3.2 billion -- to the GUPC consortium led by Spanish company Sacyr.

The GUPC bid was $363 million lower than budgeted by the canal authority and well below bids from competing companies.

In an interview on Panamanian television, Martinellii suggested Aleman Zibieta and the canal authority should have anticipated the GUPC was underbidding.

"Everyone here knew the state of the company Sacyr, that it was having financial problems," Martinelli said, dubbing the current situation "the chronicle of a death foretold."

The canal authority and the GUPC consortium have locked horns since December over the overruns on widening the canal to accommodate massive cargo ships in the century-old waterway, which handles five percent of global seaborne trade.

GUPC claims unforeseen geological difficulties have forced them to spend much more on cement than expected. They say that they based their estimates on data provided by the Canal Authority that was incorrect.

The canal expansion is one of the world's most ambitious civil engineering projects and was due to be completed next year -- but the builders have said completion may now be delayed up to five years.

The original canal, built by the United States mostly with workers brought in from the Caribbean, was completed in 1914.

The canal generates $960 million a year for Panama, nearly 10 percent of the country's total annual income. (

Editor's Comment: Called it! Martinelli and the CD was courting Zubieta to be their presidential candidate, even though he's a PRD guy. Zubieta said no, and therefore here we are today. If Zubieta had said yes, then there would be no conflict, and Zubieta would have been Panama's next president. Martinelli is one vengeful dude. Now he's going to be blaming the whole mess on Zubieta and the PRD, which is actually accurate.

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One Last Proposal by the ACP (Before They Give The GUPC The Yuca)

Canal ExpansionTime is running out for the negotiations between the Panama Canal Authority (ACP) and Grupo Unidos por el Canal (GUPC) to find a solution to the crisis that has paralyzed work on the third set of locks.

Last Friday, the consortium composed of the Spanish company Sacyr, Italy's Salini Impregilo, Belgium's Jan de Nul, and the Panamanian company CUSA sent the ACP a proposal, which they said "reflects our continuous efforts to accommodate the ACP's concerns during the negotiations."

The ACP responded with a counter-proposal, that would be their last, in its effort to find a solution to the crisis that has already been dragging on for more than a month, with its origins in cost overruns - not recognized by the ACP - of $1.6 billion dollars in the project to build the third set of locks, the largest single contract of the expansion program.

The ACP's proposal suggests, as requested by the consortium, an extension of the deadlines for repayment of advances, without giving further details on these.

A quick resolution to the conflict is key to the project. Work has stopped since last Wednesday, after a deadline expired and the negotiating parties were unable to reach an agreement.

The administrator of the ACP, Jorge Luis Quijano , said the institution would be willing to take over the project and to complete it by 2015, as currently scheduled, but in order to do it they must act quickly to take advantage of the short dry season. (Prensa)

Editor's Comment: I predicted a long time ago that the ACP would boot the GUPC, hire someone else to finish the job, and then sue the GUPC companies for failure to perform. In that way, the Panamanian people will basically get the $7 billion dollar project for $5.25 billion - and the low ball bid gets turned around and stuffed right up the GUPC's ass. Remember, they were hired by the PRD (for a reason). Can you spell "yuca?" Now do it about 1.6 billion times. Yuca, yuca, yuca, yuca... There's a whole lot of yuca coming down.

Panamanian Spanish Lesson: When someone get's screwed over, Panamanians will say "se le metio la yuca" which literally means "they stuck the yuca in him." As in, they stuffed it up his ass. Yucas typically have a pointy end, but then they get thick at the base, and are about as big as your forearm - perfect for stuffing up someone's ass - and not something normal people would consider enjoyable. This expression is often used when someone thinks they were going to get over because they were going to try to be clever or slick, but then the tables were turned and the person who thought they were going to get over, gets hosed instead. They get in trouble or go to prison or what have you. In this case the ACP is pulling the old yuca trick to the GUPC. Silly Spaniards, thinking they could "out slick" the Panamanians on their home court...

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Varela Hermanos Not Paying Their Workers Minimum Wage, Again

PoliticsPanama's Ministry of Labor and Workforce Development revealed in a press conference Monday the company Varela Hermanos SA owes $102,000, after they conducted an inspection to verify that the company is complying with the new minimum wage that went into effect on 1 January 2014.

For this reason, the company was fined $202,500 which is added to the $107,500 the company already owes due to fines levied by Mitradel in 2011.

Dario Falcon, Vice Minister of Labor, explained the company Varela Hermanos is categorized as processing sugar cane, which has a higher minimum salary rate, and the amount they pay in minimum salary should be based on this activity, "it's not to see if they are doing it or not; they should set an example, and pay their workers," he said.

Meanwhile, Mario Molino, the Secretary General of the Mitradel, said this was not a question of political persecution, but rather they are checking this company in the same way as they check all others, to make sure the they are following the law. "I urge the company to come to the Mitradel and to pay this fine, and with this to be good countrymen," he said.

Mitradel revealed there are about 220 workers on both the permanent payroll as well as those hired to work during the harvest who are owed the wages.

During this inspection they checked the books of about 69 different companies. Of these, they found 12 that were not paying the correct minimum wage.

On 30 December 2013, the Government announced the new minimum wage of $624 per month for zone 1, and $488 per month for zone 2.

The Mitradel inspections will continue on Wednesday. (Telemetro)

Editor's Comment: Doesn't really matter all that much. Juan Carlos Varela, the presidential candidate for the Panameñista political party, really had no chance of winning anyway. It's hard to get elected by a bunch of poor Panamanians, if you don't pay your workers fairly, and as required by the law. And of course this is "political persecution." They are conducting just enough inspections of companies in the surrounding areas, and I'm sure if there are any owned by "friendly" businessmen who vote for the CD, then they will get a heads-up to let them know the inspections are coming, and to give them time to get their books in order. The other 12 companies that were also fined were probably also owned by people who have political tendencies not in alignment with the CD, either PRD or Panameñista. The Panamanian government in general, and this administration in particular, makes an art form out of "selective enforcement" for fun and profit.

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Fire Department of Panama Conducts First Safety Drill on Panama's New Metro Subway System

Safety & SecurityFiremen from the Fire Department of Panama City successfully completed the exercise on Via Transísmtica on Sunday.

They reopened the roadway after the last part of the exercise was over, at about 11:00 am.

They closed the part of the road from the Estrella Azul plant until Monte Oscuro in both directions.

About 30 firemen from the Fire Department of Panama participated in the exercise, using two fire trucks.

As explained by a department spokesman, the goal is to be ready to respond to any emergency that might occur either on the elevated section of the Metro, or in the underground stations of the new subway system.

Panama's Minister of Government Jorge Ricardo Fabrega attended the exercise, who congratulated the firemen.

Fabrega said modifications being made to the Law, to improve the equipment of the Fire Department of Panama. (Telemetro)

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Big Drug Bust in Coronado

Drug TraffickingThe Panamanian national police made a large drug bust in Coronado yesterday.

The Directorate of Judicial Investigation seized 49 kilos of cocaine yesterday afternoon.

They also seized several vehicles with double bottoms, used to transport the drugs.

Five people were arrested. (Critica)

Editor's Comment: No matter where you are in Panama, there could be a massive pile of cocaine just a few feet away, or a suitcase filled with a million dollars in cash...

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Murder Ship exploiting loopholes to frustrate investigation

Panama Flagged VesselsTHE Japanese owners of the Sage Sagittarius - dubbed the "murder ship" - are exploiting a legal loophole to cut operating costs and avoid its national laws.

This "flags of convenience" system is now being blamed for complicating an Australian investigation into two deaths at sea which has blown out to almost 18 months.

Two Filipino ship workers were killed in Australian waters within weeks of one another while on the Sagittarius between late-August and early-September in 2012.

A Japanese safety superintendent was killed weeks later after falling into the ship's conveyor as the Sagittarius docked in Japan.

The Sagittarius is registered in the Central American nation of Panama. By having a flag nation of Panama, ship owners may escape regulations enforced by more developed countries.

Ships like the Sagittarius constantly visit ports near Mackay, Gladstone and Bundaberg in Queensland and Newcastle in New South Wales.

Under international law, the flag nation must investigate incidents involving its flagged ships.

It took until January 5 - three months after the third death aboard the ship - before a single Panamanian investigator inspected the Sagittarius.

By then, the man captaining the ship while two men were killed in Australia waters was long gone. He quit his post immediately after the second incident, while the Sagittarius was docked in Newcastle.

Up to 70% of cargo ships fly a flag of convenience, despite condemnation from the International Transport Workers Federation.

ITF Australia coordinator Dean Summers said the flags of convenience system was "absolutely" delaying Australian investigations.

"It provides for corruption, it is a complete de-regulation of the ship and everything to do with it," Mr Summers said.

"An incident on an Australian-flagged ship would be investigated by the Australian Marine Safety Authority and Australian Transport Safety Bureau using highly-trained seafarers who respond immediately."

Both the Australian Federal Police and New South Wales police have now given a brief of evidence to the NSW Coroner.

Naoya Miyasaka, a spokesman for Sage Sagittarius owners Hachiuma Steamship, denied the company used Panama to avoid regulations.

"The flag of registry has nothing to do with the high standards that are required of us and achieved on all our vessels," he said.

An AFP spokeswoman said it was a complex case involving state, national and international jurisdictions. The AFP would not comment on its work with its counterparts in Panama.

Comment has been sought from Panama's embassy in Singapore. (

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Exclusive Interview: Panama Canal Project Won't Be Held Hostage By Contractor Shutdown

Canal ExpansionBy C. J. Schexnayder (Engineering News-Record) - For the past six weeks the Panama Canal Authority (ACP) has been negotiating a reported $1.6 billion in cost overruns with the contractor building the locks for the waterway's Third Lane Expansion.

On Feb. 5, the contractor consortium, Grupo Unidos Por el Canal (GUPC), stopped work on the project, citing a breakdown in negotiations that threatens the original mid-2015 completion date of the $5.2 billion project. GUPC consists of Spanish construction firm Sacyr Vallehermoso S.A., Italy’s Impregilo S.p.A., Jan De Nul n.v. of The Netherlands and Panama's Constructora Urbana S.A.

ACP Administrator Jorge Luis Quijano, an industrial engineer who has headed the expansion since it began, spoke at length to ENR about the project status and its current options. He reiterated the intention to complete the project by its planned finishing date next year “with or without the assistance of the contractor.”

ENR: What is the current status of the project?

Quijano: We are at a stage right now where [contractors] have stopped work. They say they have not stopped work, but there is no work happening at all. On Feb. 5, there was maybe 1% of work being done by a few subcontractors, but a day later, work is completely at a standstill. [GUPC is] saying they haven't formally notified us that they have stopped work. For me, that has really zero value since it is a de facto work stoppage. We know for a fact they have told workers to go home. They have told subcontractors to stop work. We even have subcontractors ask us if they are going to be paid or not.

We have left a little window of opportunity for continuing to exchange views with the contractor to see if an amicable resolution is possible. However, the more time that passes, the less likely that is to happen. We sent [the contractor group] a four-page letter on Feb. 5 asking them to substantiate their actions because, to us, this is a hostile act and it needs to be resolved immediately. They have already wasted enough time. They began slowing down in November and they continued to keep slowing it down until now they've brought it to a total halt yesterday.

ENR: Is this action sufficient grounds to break the contract and move forward without GUPC?

Quijano: The contract is very clear that if work is stopped or significantly reduced—or any part of the work is substantially reduced—that is sufficient grounds to take them off of the job. We feel very strongly about their actions, and if they decide not to settle this and not return to work, they leave us very little option but to default them.

We are looking at the next few days that will be critical in our decisionmaking process. As time passes, we have less and less of a chance to have a negotiated solution. We are not closing the door but they are leaving us with very little room to maneuver. But we are not going to be held hostage for their work stoppage; we are going to take action. I'd say we are coming to the end of the road and we not talking about weeks to get this taken care of, let's put it that way.

ENR: How long has this situation been developing?

Quijano: This is not the first time we have been at this juncture with the contractor. This is the first time [GUPC has] taken a hostile position by stopping the work but in December 2012, [the contractor] was having similar cash flow issues. They came to us and requested relief by asking for a moratorium on paying back their lines of credit. They wanted some relief so they could last until the return on some of the claims they had made for cost overruns. We agreed and they did not pay back any of their lines of credit in 2013. They took the whole year and didn't win a single claim they put in to the dispute arbitration board.

They had whole year of non-repayment, which amounts to about $300 million to us, to continue work and have the time to substantiate the claims they felt they could win. The moratorium ended in December 2013 and they have to start repaying—and they have to do so very quickly at the rate of about $39 million a month.

According to the contract, they have to continue to work while these claims are being evaluated. This is costing them more than what they expected and what they want to do is make us pay for all the expenses. This is not a cost-plus project.

What we have put on the table is a further deferral of the repayment program, extending the moratorium significantly so they can continue the work. But even with that, they still have not agreed to continue the work. They did not accept that offer and, instead, asked for a moratorium to 2020.

ENR: Several times you have mentioned a 'Plan B' to complete the job without GUPC; what does that entail?

Quijano: Plan A is to continue working with the contractor and finish the job according to the contract. Plan B is to go ahead with the work without this contractor. We don't see any other alternative. It is either one or the other. Some have suggested that we don't have the construction know-how to handle it, but we're not going to construct it.

What remains to be done? About 30% of the work. What remains to be done in concrete? About 20%. All the designs for the project have been completed. Those designs are ours. The amount of work that remains is backfill and about 900,000 cubic meters of concrete (out of the 4.4 million cubic meters total). Outside of that, it is only the electro-mechanical work. And all of the electro-mechanical work was going to be done with sub-contractors. Even GUPC had planned to do that.

Our Plan B is very simple; work with all the subcontractors who were [already] going to perform the electro-mechanical work. We need a small general contractor on the Pacific side. We need a small general contractor on the Atlantic side. These will be needed to continue to provide the general services and construction management activities. But it is not the same size of a project we had in 2009. Taking this job from here onward is not the same as starting from scratch.

ENR: Fabricating new gates for the locks would take longer than a year. What arrangements are there to procure the gates that have already been made?

Quijano: The new locks have 16 gates in total. We already have four gates here along with all the electromechanical elements for them. Four gates have been completed in Italy, and are awaiting transportation. Another four gates are going to be ready in a month's time. And the last four gates will be ready by June at the very latest.

We don't expect Cimolai [the subcontractor in Italy] to give us the gates they have already fabricated for free. Unlike GUPC, Cimolai has done an outstanding job by continuing to work. [The firm is] very professional and we have a very good relationship with [it]. I feel we will continue our working relationship with [Cimolai].

There is very little use for these gates other than in the new locks. They cannot be sold for any other project, and if they are scrapped, it will bring in maybe one-tenth of what they are actually worth.

If the [GUPC] plan is to hold onto those gates and force us to look elsewhere to fabricate [new ones] from scratch, that to me is extortion. And it affects far more than just the Panama Canal. The canal is not being done just for Panama, it is being built for the world. The United States is the number one user. China is number two, and Latin America is the third biggest user. There is a lot of international interest to see this project is completed.

ENR: GUPC won the locks job with a bid of $3.12 billion, more than $1 billion under the next lowest bid submitted by the consortium of Bechtel and Taisei Mitsubishi. Is there reason to believe this was underbid?

Quijano: At the time we fully analyzed this and we fully believed the amount bid was an adequate amount. We had hired consultants who drew up a range of what the bids were expected to be. And we set an estimated range of $3.1 billion and $3.6 billion, which would depend on how each bidder saw the risk.

Many people compare GUPC's bid to Bechtel's bid but forget this was a design-build project; you bid on the basis of your design and the amount of risk you feel comfortable taking. But GUPC is now asking for $1.6 billion, which is far more than the difference in those two bids.

ENR: There were concerns when ACP chose to join both sets of locks into a single contract due to the size and complexity of the job. Was that a factor in the issues you are facing now?

Quijano: Because it was design-build we thought it was much better to have both [sets of locks] done by one general contractor than by two. The design had to be the same for both and by having one contractor do it, you could actually cut down on the time.

We felt [GUPC] could handle it if [it] had done the work with diligence from the very beginning, but, I regret to say, [the contractors] did not. We started to notice that about a year into the program. We started to get the impression they would not be able to complete the job in the allocated time we had allotted.

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Prosecutor Considering Charging Brimager

Expat TalesThe murder of the American woman Yvonne Lee Baldelli, who disappeared in November 2011 in Bocas del Toro, could be a case of either domestic violence or robbery, for the theft of her credit cards, so prosecutors are considering charging her boyfriend for the crime.

This was announced by the Superior Prosecutor of Bocas del Toro, Vielka Broce, who said these are the two main theories they are developing after the investigation they have conducted.

Broce said her office received legal assistance from the United States to confirm the link between Baldelli and her partner Brian Brimager.

The official explained they have also taken testimony from some of the neighbors who lived near where the couple were staying, who claim to have heard some disputes between them.

She said the evidence of theft was generated when Brimager used Baldelli's credit cards in Costa Rica, so therefore that is a possible motive they have not discarded.

Baldelli's body was found on August 21, 2013, almost nine months after her disappearance, by a group of fishermen in a secluded spot on Isla Carenero in Bocas del Toro, in a military-type bag. The remains of the victim were identified by a comparison with the parental DNA and samples taken from the remains. (Prensa)

Editor's Comment: OK, so my source was a little premature. Last week when I saw an article in the US press saying Brimager had been charged in San Diego with two additional counts by US authorities, I reached out to one of my contacts who is close to the case. I was told the prosecutor had already charged Brimager with murder, and was working to coordinate the details related to his extradition.

Apparently, as a result of my earlier article saying Brimager had been charged with murder by the prosecutor, the Panamanian reporters contacted Broce to confirm. Her answer in this article basically says they're close, but they have not charged him yet.

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IDAAN Has Finished Maintenance Work on Water Main

Infrastructure UpgradesThe Institute of Aqueducts and Sewers (IDAAN) is continuing to check on the areas at higher elevations in Panama City and San Miguelito, to assess the restoration of drinking water service, after they successfully concluded the second interconnection of a 60" water main line, in the sector of Maria Henriquez.

The job, scheduled to take about twelve hours, ended at 7:30 am on Saturday morning, and are part of the project to interconnect the pipelines from the water treatment plant in Chilibre and Panama City, and to connect to a water storage tank located in La Cabima, to supply drinking water to Eastern part of the province of Panama. (Estrella)

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North Korean Vessel Chong Chon Gang Will Sail From Panama After Paying Fine

Panama NewsThe North Korean ship Chong Chong Gang, seized in Panama since July last year for carrying undeclared Cuban arms under a cargo of sugar, may depart immediately after those responsible for the vessel paid the fine imposed by the Panama Canal Authority for violating navigation rules of the waterway.

The ACP said in a press release issued today representatives responsible for the vessel Chong Chon Gang paid the $693,333 fine that hung over the ship.

"With the payment received, and in strict compliance with its processes, the ACP authorized the departure of the ship, so therefore its representatives can dispose of it immediately," said the statement.

The ACP specified that in the case of the North Korean vessel Chong Chon Gang, their only responsibility is for the infractions and offenses committed by this vessel against the rules of the Panama Canal, which are unrelated to any other possible faults that might have occurred outside the jurisdiction of the Panama Canal.

The Public Ministry of Panama reported on Wednesday that it will auction off the 10,000 tonnes of sugar used to conceal the undeclared Cuban arsenal.

The Government of Panama had held the North Korean vessel Chong Chon Gang since last July , when it was searched on suspicion of carrying drugs, but what was found was an arsenal of weapons that Cuba later acknowledged to be theirs.

The weapons, including missile platforms, two MIG-21 fighter jets, new motors for these aircraft, and other parts and ammunition were unloaded and taken to a hangar near Panama City.

The ship's 35 North Korean crewmen are still in Panama. Thirty two of them are waiting to be repatriated and the other three are facing charges including endangering the public safety, a crime that carries up to 12 years in prison.

The 32 sailors are still being held in a naval base of the Panamanian police, while the Ministry of Foreign Affairs and the National Authority for Migration (ANM) makes arrangements for their repatriation.

The destination of the weapons in the hands of the National Security Council of Panama, that has not yet been determined.

In the case of the North Korean ship carrying undeclared Cuba arms, Panama asked for help from the UN, and last August a team of experts from the Security Council came to the country to inspect the arsenal.

The UN team said in a preliminary report that in the case of the North Korean ship, it violated the resolutions that prevent Pyongyang from importing or exporting weapons of any kind, according to a report issued to Panama on 28 August 2013. (Panama America)

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ACP Responds With A New Proposal

Canal ExpansionThe Panama Canal Authority (ACP) responded to the latest approach in the press made by the Grupo Unidos por el Canal (GUPC), with a counter offer to continue the construction of the third set of locks, which has been paralyzed for three days.

" As we prepare to take the actions permitted under the contract to reactivate work on the project, we remain open to the possibility of reaching an agreement, and for that we are making this effort," said the administrator of the Panama Canal, Jorge Luis Quijano, in a press release.

According to the ACP, the proposal sent to the consortium does not increase the original contract price of $3.118 billion, nor does it accept or admit any claim (for cost overruns), which, if given, most follow the contract process (to be resolved).

(In the counter-offer) it is also understood that the parties will have to provide additional financial resources so that work on the project can be restarted as soon as possible, but no dates or details of the procedures were offered.

The offer, subject to review and approval by the parties, establishes specific dates for the delivery of the gates, by GUPC, and for the final completion of the work.

The two sets of locks (one on the Pacific side and one on the Atlantic side of the Panama Canal) require a total of 16 lock gates. Of these, four have already been transported to Panama. The remaining 12 are in Italy. Eight are still in different phases of the manufacturing process, and four have been completed and are ready.

The ACP also proposed to further extend the repayment period for the $748 million that the ACP paid in advance to the consortium, "to the extent that GUPC meets the required delivery dates."

Executives from the multilateral financial institutions who provided $2.3 billion dollars for the expansion program visited the ACP and toured the work site during the day yesterday.

The government of the United States, which administered the Panama Canal between 1914 and 1999, also urged the ACP and the GUPC consortium yesterday to reconcile the differences that have disrupted construction of the third set of locks.

"We hope for a rapid resolution of the current work stoppage, and the full resumption of activity in the expansion of the Canal," said a State Department spokesman, quoted by the DPA news agency. (Prensa)

Editor's Comment: The ACP is doing two things at once. They are getting ready to either take over the project or hand it to someone else to finish, while at the same time they have to listen to the GUPC continue to chatter and whine. So they tossed out this "new" counter proposal, which in fact does not contain anything all that new or different. The fundamental facts on the ground remain the same. The GUPC won the contract through a low-ball bid, and they fully intended to try to jack the ACP for the necessary $1.6 billion dollars from day one. The ACP knew what they were doing, and is sticking to their guns by simply saying no, and forcing the GUPC to complete the project as required by the terms of the contract. The GUPC simply can't do that (the money isn't there) so they will walk away. That opens the door for the ACP to sue them for the additional costs of completing the project, the $1.6 billion dollars lacking in GUPC's lowball bid. This all sort of boils down to little more than a game of high stakes chicken - with the Panama Canal in the middle. Not to worry though, because it will be built, albeit with some delay.

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Special Sale - Luzdecor Offers Quality Lighting Fixtures

Construction & Interiors Luzdecor, located on Calle 50 in Panama City, is having a special sale on Chandeliers and other lighting fixtures.

Luzdecor is one of the largest lighting companies in Panama City . Located on Calle 50, we have a wide selection of all kinds of lighting fixtures.

Our lighting design experts can help you pick and choose the right solution for your needs. We have all available technologies and can find the right mix of solutions for any space or situation.

We import and export lighting fixtures through the Colon Free Trade zone, and can provide any level of quality merchandise; high-end one of a kind pieces, to large volume solutions for construction projects.

We also specialize in technical and colorized lighting. New lighting fixtures arrive continuously. Modern Italian fixtures are available as well as classic Crystal chandeliers. Wall sconces and flush mounted ceiling fixtures are plentiful in addition to a full line of bathroom vanity fixtures. Tiffany table lamps are a very popular solution for hard to decorate areas.

Not only does Luzdecor have a very wide assortment of lighting fixtures it has one of the most varied selections of replacement light bulbs in stock. It would be very difficult not to be able to find a replacement light bulb in luzdecor. Generally if a light bulb can't be found in luzdecor then the owner will find the needed unit and provide a special order estimate within 48 hours.

One of most important factors attributable to luzdecor is that the owner is practically always on the premises or available by cell phone. It is not uncommon for the owner to open the showroom on Sunday or to stay late in the evening for a client that has a very difficult schedule and cannot make it to the showroom during regular business hours. The client can always know that the owner is also the main buyer of all the items that are available therefore the client can rest assured that they will get the best possible attention. The owner is an New Yorker and expatriate who moved to Panama City after the U.S.A Invasion in 1990 so he understands the complications and traumas of moving to a foreign country.

Luzdecor has many ties to other New Home/Remodeling contractors that may be of assistance in a move or remodeling project in Panama . Whether it be quality and reliable contractors for Air Conditioning, Sheet Rock Artisans, Flooring Experts, to Internet Service Providers; luzdecor can assist in helping you find the additional help you may need to make your move as seamless as possible. Please stop by and see what we have to offer.

Visitors are always welcome. Call first for directions if necessary. We are located on Calle 50, on the right hand side of the road, across from Multimax and diagonal from McDonald's. Our phone numbers are; Panama: +507-270-7412, Fax: +507-270-7414, USA Fax: +1-772-325-6405, HK Fax : +852-301-49505

• EL-12 CL/AMB - Bohemian Crystal 12 Light E12 Chandelier White Crystal Frame with Amber Crystals.

• EL-4 SL - Bohemian 4 Light Clear Crystal Chandelier E12- 60Watt Max 20" W X 28" H.

• BIANCA -12 BK/RD - 12 Light E12 Black/Red Crystal Chandelier - 26"W X 28" H.

• BIANCA -12 SL - 12 Light E12 Clear Crystal Chandelier - 26"W X 31" H.

• BIANCA -18 SL - 18 Light E12 Clear Crystal Chandelier - 32"W X 26" H.

• MDN-1061-Clear Arc 2 Tier Chandelier in Polished Chrome with Clear Round Outer Glass Clear Square Inner Votive - 9 x 40 Watt Halogen - G9 Bulbs - Width: 30.5" - Height: 28.5.

• MDN-1064 - Modern 5 Light Semi Flush Mount In Polished Chrome -Double - Glass: Clear Round Outer Glass, Clear Square Inner Votive -5 X 40 watt G9 - Width 19" - Height 14"

Best Regards,

Joseph Fallas

Luzdecor / Falco, S.A.

Tel: +507-270-7412, Fax: +507-270-7414

USA Tel: +1-954-482-5801, USA Fax: +1-772-325-6405





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New Roads Drive Buyers In Panama, But Only After Insiders Get First Pick

Real EstateWhen former Panamanian President Ernesto “the Bull” Balledares purchased property near Rodeo Viejo in 2004, the only access was a dirt road used mostly by farmers and villagers coming down from neighboring mountain towns. Prices were less than $1,800/acre.

But upon executing a convenient new government road project to the destination, real estate prices shot up to over $8,400/acre, an increase of 400%.

Today, the past seems to be repeating itself as Panama City, Panama’s most famous surf beach, Playa Teta, is getting a makeover starting with a paved road over the 1.2 kilometer stretch from the Pan American Highway all the way down to the beach.

Developers began months ago on new projects in anticipation of the announcement, and property values are expected to follow a similar (if not more emphasized) trend.

It happened first in Costa Rica in the ‘90s and it happened in Panama’s Playa Venao: dirt roads keep people away and keep land prices low...

The the government announces a road development project with little fanfare...

Then the speculators move in.

And once the new road project is completed, the masses follow suit.

But information on new road projects is kept closely guarded with typically government insiders the only ones in a position to capitalize.

And this series of events is now predicted to take place in Punta Barco, the beach town next door to Coronado, as its new government road project unfolds over the next three months.

Known for the consistent surf at Playa Teta, Punta Barco will change in 2014 as developers are seeing strong sales on the four residential projects directly accessed by the newly-announced paved road.

The most impressive of these projects by far is the Punta Barco Country Club, which will feature 180 homes within a gated community, offering luxury-style amenities at a “mid-range” price point.

Carved out on 10 hectares, the development group Danvivienda is looking to fill a niche on the beach that’s seen strong demand from foreign buyers and upper middle class Panamanians: Single Family Homes under $250,000.

On the heels of this new road announcement, and before they have even completed their model showroom, reports show that Punta Barco Country Club has sold more than 30 homes “off-plan” in the gated community, which is a small but very obvious indication that early buyers knew about the road and knew that prices are going to be shooting through the roof in this, a previously sleepy surf beach.

Investors will be watching this development and others closely as the new road moves in and the area gains popularity through better access from Panama City and Coronado.

For more information, contact our experts at Panama Equity Real Estate.

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Panamanian Authorities Charge Brian Brimager With Murder

Expat Tales By Don Winner for - Last week the Superior Prosecutor in Changuinola, Vielka Broce, filed former murder charges against the American Brian Brimager, for the death of his girlfriend Yvonne Baldelli, and they are now moving to extradite Brimager from the United States to Panama to face those charges.

A local worker found Baldelli's remains in August 2013 on Isla Carenero. She had been partially dismembered and stuffed into a green military style backpack, similar to one issued to Brimager, a former Marine.

Panamanian prosecutors have been coordinating closely with the Legal Attaché of the US Embassy in Panama for months, after the discovery of Baldelli's remains, in order to pursue Brimager's extradition from the San Diego area of California in the United States - where he remains in prison facing charges of obstruction of justice, giving false statements to a federal officer, and falsifying records - all related to his elaborate attempts to cover up his involvement in Baldelli's murder.

An International Treaty between the United States and Panama signed in 1903 allows for the extradition of US citizens to Panama to face justice, however this will apparently be the first time Panama has ever formally requested extradition.

Law enforcement and judicial authorities from both Panama and the United States are proceeding slowly and carefully, making sure to account for every required step and action, anticipating a legal challenge by Brimager's attorneys in the United States to attempt to prevent the extradition from taking place.

Panamanian authorities are currently coordinating through their Foreign Ministry to process the proper paperwork, in order to formally and officially present their request for Brimager's extradition to their counterparts in the United States.

It is anticipated the request will be presented in the coming days or weeks.

Editor's Comment: The public jail in Changuinola is paradoxically known to the local Panamanians as "California" - because that's the name of the little neighborhood where it's located, close to the border with Costa Rica on the Caribbean coast.

Back when the serial killers William Dathan Holbert and his accomplice Laura Michelle Reese were arrested for having murdered five people in Bocas del Toro, the Superior Prosecutor for the province was located in the city of David. That's why Holbert is being held in David, because the prosecutor there is still handling those cases.

Since then, however, the Panamanian authorities have created and staffed a new Office of the Superior Prosecutor in Changuinola, responsible for the province of Bocas del Toro. So, after Brimager lands in Panama in handcuffs, he will be transported straight to the "California" prison there. There, he can check out any time, but he will probably never leave...

One more thing - I'm breaking this story, and no one else has this yet. To any new outlets who would like to pick this up - go ahead and use whatever you want from this article (permission granted) as long as you give credit to this website, and cite the full URL - "". Many thanks.

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New charges filed in Panama slaying case

Expat TalesBy Kristina Davis (SAN DIEGO) New obstruction charges have been filed against a Vista man accused of killing his girlfriend on a Panamanian island.

Brian Brimager, 37, pleaded not guilty to the new charges in San Diego federal court Friday.

The former Marine is accused of killing 42-year-old Yvonne Baldelli on Isla Carenero in 2011, then disposing of her body and embarking on an elaborate cover-up.

The couple had moved to the small Caribbean island from Orange County to start a new life, but the relationship turned rocky, according to court documents.

Baldelli’s remains were discovered in August in a swampy area of the island, in a zipped green military-style bag.

In June — before the remains had been found — Brimager was charged by the U.S. Attorney’s Office with obstruction of justice and giving false statements to a federal officer. This week, two counts of falsifying records were added.

The indictment said Brimager hacked into Baldelli’s email and wrote messages to her friends and family to make it seem as though she was still alive. One email stated she was very happy and had gone to Costa Rica with another man.

Authorities said that after the slaying, Brimager returned to San Diego County, where he married the mother of his young daughter weeks later.

Brimager’s attorney, Brad Patton, has filed a motion to dismiss the charges, arguing the FBI investigation his client is accused of obstructing does not qualify as an “official proceeding” under the law.

Patton said in court that he plans to file an amended motion in light of the new charges. Those motions are expected to be argued in March.

Now that Baldelli’s remains have been found, Panama authorities are working to charge Brimager with murder and domestic violence, said Baldelli’s father, James Faust.

It’s his hope that Brimager will be found guilty of the obstruction charges in the U.S., then extradited to face more serious charges in Panama.

“What we’d like to see happen is for him to be brought to justice, for Yvonne’s sake,” Faust said after the hearing, which was attended by several friends and family members. (

Editor's Comment: See my next article about Brimager...

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The ACP Has A "Plan B" To Finish Panama Canal Expansion Project

Canal ExpansionJorge Luis Quijano , administrator of the Panama Canal Authority (ACP), said he was confident the project to build a third set of locks as part of the project to expand the Panama Canal would be done in 2015 "with or without the Grupo Unidos por el Canal," the contractor for the project, who stopped working on the project completely on this most important aspect of the expansion program.

Quijano made ​​his first public statements after the deadline imposed by the GUPC expired and the parties were unable to reach a negotiated solution to the problem, to avoid a complete shutdown of work on the project.

Flanked by the Vice Presidents of the ACP, in a packed press room, Quijano said "the project can be saved for 2015."

In order to achieve that, "we have to act fast, because the dry season is ending," said Quijano. Much more work can be done during the months of the dry season (mid December to mid April) than during the rainy season.

While declining to go into details, Quijano said the ACP has a Plan B and there is no fear about the work that is left to be done. Right now the entire expansion project is about 70% completed.

Inside the halls of the ACP it is understood the slowdown of progress on the project and the recent cessation of activity by the GUPC is sufficient reason for termination of contract.

In fact , according to the contract, if the consortium "abandons all or a substantial part of the works, or demonstrates the intention not to continue the execution of their duties," is cause for termination of the contract.

However, Quijano refused to discuss further details of the strategy followed by the entity.

"We are going to observe all of the legal steps to be sure that our decisions, after having made a complete and total analysis of the situation, are correct and within the terms of the contract for us to continue this project."

About the eventual takeover of the project, Quijano said they would take action "at the appropriate time" and he said "we have to work with a cool head, although we have a warm heart."

The ACP does not want to make any false steps which could cause the loss of the $400 million performance bond held by the Zurich American insurance company.

Yesterday, both Quijano and the GUPC raised the tone their rhetoric, while the two sides exchanged accusations regarding the causes of the crisis.

With the protocol of negotiations having expired, both sides took off the gloves which in recent weeks had left them making diplomatic pronouncements about the good intentions all around.

Quijano, who has been summoned to speak before the National Assembly, spoke of "threats" and "blackmail," and he said because of the "the intentions of the GUPC against the best interests of Panama and the Canal," they were unable to reach an agreement, due to the "inflexible position of the consortium," that "who tried to negotiate exorbitant numbers that were not sustained, outside of the contract."

Meanwhile, the GUPC spoke about the "unreasonably rigid position" of the ACP, and they warned a breakdown in the negotiations would lead to "years of litigation and arbitration" and cause delays on the project of between three to five years, which would leave a "continuous shadow on the ACP and the Panama Canal."

Paradoxically, both sides said they were open to a possible reconsideration, although Quijano acknowledged that confidence has deteriorated. (Prensa)

Editor's Comment: Boy, I called that one. Now they ACP will very carefully and slowly pick their way through the legal minefield. They will find a way to boot the GUPC, take over the project, cash in the $400 million performance bond, and then sue the GUPC for the rest of the cost of the project. Boy, are the lawyers going to feed off of this one. The only thing I don't know yet is what contractor is going to pick it up. It will either be Odebrect or Bechtel, but I don't know which...

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Panama says canal work suspended, company denies

Canal ExpansionA dispute over a $1.6 billion cost overrun in the Panama Canal's expansion took a new twist Wednesday after a Spanish company leading the project denied it halted work over the spat.

The Panama Canal Authority said the consortium led by Spanish builder Sacyr had halted work after negotiations broke down, but the company later announced that it made a "final offer" to prevent a shutdown.

The two sides have locked horns since December over unforeseen expenses in a project to widen the canal to accommodate massive cargo ships in the century-old waterway, which handles five percent of global maritime trade.

Panama Canal Authority administrator Jorge Quijano said the "inflexible position" of the consortium known as Grupos Unidos por el Canal (GUPC) had derailed the negotiations.

"They put a threat on the table, and today (Wednesday) they carried it out," he said.

"We demand the work be restarted immediately," Quijano said, adding that a proposal to cancel the GUPC contract is still on the table.

In a statement, Sacyr said the Panama Canal Authority had decided to "break off negotiations" but company president Manuel Manrique later said that the company would keep the talks alive.

"What happened is that the ACP (canal authority) rejected our last proposal without proposing a viable alternative, and this is why we released the statement," Manrique told Spain's Cadena Ser radio.

"But later we sent a letter proposing to continue and so we will see what happens... We have made a final offer to the canal (authority)," he said, adding that there was "no concrete date" to suspend the work.

"This depends on the response" from the canal authority, Manrique added.

The project to widen the canal, one of the biggest civil engineering operations in the world, is due to be completed next year but GUPC has said that the dispute threatens to delay completion by up to five years.

In its earlier statement, Sacyr said the collapse of the talks "puts in danger the widening of the canal and up to 10,000 jobs."

Sacyr said that if a solution were not found immediately, Panama would face years of litigation before national and international courts "on the events which have brought this project to the edge of failure."

'Bad' for world economy

The European Union's industry commissioner, Antonio Tajani, who has mediated the dispute, warned that "the interruption of the works would be bad news for employment, for the worldwide economy, for the expansion works of the canal."

Spain's Public Works Minister Ana Pastor called for an agreement be found quickly "because what is at stake is infrastructure that has an impact not only on the economy (of Panama) but also the world economy."

The canal facilities are being widened to permit the passage of ships carrying up to 12,000 containers, twice the current limit.

But the disputed contract to build locks, due initially to be completed this year, was already running nine months late and since the beginning of this year work has slowed down further.

GUPC says that unforeseen costs total $1.6 billion (1.2 billion euros) beyond the initial $3.2 billion value of the contract.

GUPC is in dispute with the Panama Canal Authority mainly over who was responsible for the quality of geological information and who should bear the cost of problems and delays arising from unexpected geological difficulties.

The consortium is proposing that the two sides each pay half of the extra costs until the project is completed.

They would then go before an international arbitration court for a decision on who is responsible for the unforeseen costs and who should pay.

Tajani said the breakdown was unexpected as the Panamanian president had said the previous day that the parties were "very close" to an agreement.

The consortium warned at the end of December that it would suspend work in three weeks' time if Panamanian authorities did not provide the extra finance demanded, and the deadline for progress in the talks ended on Tuesday.

The canal, completed in 1914 to offer a short cut and safer journey for maritime traffic travelling between the Pacific and Atlantic oceans, is about 80 kilometers (50 miles) long and is used by 13,000-14,000 ships each year. (

Editor's Comment: Man, this should go into the Business Management textbooks on how not to conduct business. First the GUPC guys win the contract by putting in a low-ball bid. Their management of the project has been crap from day one. Now they are talking about geological studies that were supposedly faulty. What happened to their original argument about the concrete being the cause of them falling behind?

The truth of the matter is GUPC gambled, and lost. The mistakenly calculated the ACP would capitulate to their demands, which they timed to fall just a few months before the upcoming presidential elections. They never thought for a moment the ACP would tell them to pound sand, refuse to hand over the $1.6 billion they were basically trying to extort from them, toss them off of the project, and hire someone else. Yeah, there were lots of surprises in the way this went down for the GUPC.

Oh, and when Martinelli told the press the two sides were about to reach an agreement - in reality the decision to tell them to fuck off had already been reached. That was just a play by Martinelli to put some psychological separation between him and Quijano. In fact, they are consulting about this every day, and making decisions together. Now Martinelli can look right at the television cameras and say "I support the independent decisions being made by the Board of Directors of the Panama Canal Authority." He appointed the majority of them, so they are doing his bidding. Trust me on this one - Martinelli is the hard edged negotiator who is making the big play calls here, from the sidelines. He does the "who, me?" thing better than anyone.

Regarding the jobs in Panama - this will just be a short delay. The GUPC had about 5,000 workers and right now about 70% of them are off the job. The ACP will bring in someone else, and those guys will hire the same workers, who will go back to work. Big deal, carnival is coming up, so they will take a break then go back to work.

Regarding economic impact - instead of spending $5.25 billion to expand the Panama Canal, the government of Panama will now be spending more than $7 billion. Most of that money stays in the country in the form of salaries, services, supplies, logistics, etc. So it's just more money flowing through the washing machine. No big deal.

Regarding the additional expense - the Panama Canal generates its own income. The traffic through the Canal will pay for the expansion. Again, no big deal.

Almost everyone quoted in this article from Spain, Italy, and the European Union don't want the GUPC to be tossed off the project. The governments of Spain, Italy and the EU will not be screaming bloody murder. The ACP will quietly execute clauses in their contract with the GUPC, take over the project, and hire someone else. Then, they will sue the GUPC for about $1.6 billion dollars (the additional expense of finishing the project.)

Sacyr said the ACP "rejected our last proposal without proposing a viable alternative." Yup, that's officially the end of negotiations. They were due to fail at some point anyway, and that failure came today. I expect there are phones ringing at Bechtel right now, and there are other companies sharpening up their pencils to take over this project - which will still have about $1.6 billion dollars left of juice in it. That's billion. With a "B".

So now Sacyr is saying "no wait, we're not done yet." Yes, you are. Pack your bags and get out. Game, set, and match.

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Panama Canal officials say work on major expansion halted by financial dispute

Canal ExpansionPANAMA CITY (AP) — Panama Canal officials say work on major expansion halted by financial dispute.

Editor's Comment: That's it. That's the end of the story. It's appearing on practically every news outlet, all over the place. The talks between ACP and the GUPC have broken down, as in done, over, not going to talk any more. And now the ACP has announced that work on the third set of locks has stopped (completely.) Prior to this the GUPC had already laid off most of their workforce at the end of December 2013 (for lack of money to pay them) so work on the project had already fallen to a snail's pace. And now work has stopped.

So, that's it. As I have been predicting for weeks, the GUPC is now toast. The next thing you will hear out of the ACP is a press release about how they are going to be executing or exercising several protective clauses in their contract with the GUPC, which allow them to take over the project in the event something like this happens.

Of course, the ACP will be very careful to stay within the framework of their contract - because they know eventually they will be suing the companies participating in the GUPC for the additional costs associated with their failure to build the project for the price they submitted.

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Talks Break Down in Panama Canal Contract Dispute

Canal ExpansionBy Sonya Dowsett (Reuters) - A planned extension of the Panama Canal, one of the world's most important shipping routes, was thrown into doubt on Wednesday after a group of companies said its talks with Panama's government over how to expand the canal had fallen apart.

Group United for the Canal, a consortium led by Spanish builder Sacyr, said in a statement that the government's canal authority had broken off talks on who will pay some $1.6 billion needed to complete the ambitious project. The Panama Canal Authority said it would hold a news conference at 9 a.m. local time.

The breakdown in talks is the latest setback to a project mired in disputes since the consortium, which also includes Italy's Salini Impregilo as well as a Belgian and Panamanian firm, won a bid to double the capacity of the near 50-mile (80 km) transoceanic cargo route.

Disagreements over cost overruns have already reached international courts and talks between the two sides over how to find the additional cash to finish the project had already been extended twice.

It was unclear whether Wednesday's breakdown was final. In its statement, GUPC - the Spanish acronym by which the consortium is known - said the failure of the talks meant the expansion and up to 10,000 local jobs were at immediate risk.

But the company said it was still seeking a solution for completion of the project, which had been scheduled for 2015.

If the partnership between Panama and the builders is indeed abandoned, it would likely mean further delays while Panama seeks financing and a new construction group.

That in turn, would be a setback for companies worldwide eager to move larger ships through the Panama Canal, including liquefied natural gas (LNG) producers who want to ship exports from the U.S. Gulf Coast to Asian Markets. Delays could also cost Panama millions of dollars in projected revenue from toll charges.

Last month, Panama President Ricardo Martinelli said that Panama had the resources to complete the expansion of the Canal even if talks with GUPC ended.

"We will finish the Canal in 2015 no matter what happens, rain, thunder or lightening," Martinelli told an audience of international investors and executives gathered in Davos, Switzerland. He did not give details as to who would pick up the work or the tab.

Shares in Sacyr plunged over 8 percent on the news before recovering some lost ground while Salini Impregilo fell 1.9 percent.

"I wouldn't be surprised if Panama already had a plan B," said a Madrid-based trader who asked not to be named. "As for Sacyr...they'll push forward with new contracts, but everything they do will be looked at with a magnifying glass from now on."


Disputes over the expansion of the Canal set in almost immediately after GUPC won the bid in 2009. At the time, officials and diplomats expressed concerns over the consortium's ability to complete the project since its requested tab was $1 billion lower than the nearest competitor.

Over the past months, the two sides had been discussing how to fund the $1.6 billion needed to complete the project through a co-financing deal. Disputes about liabilities for the cost overruns, which tally with the amount the consortium say it will cost to finish the work, are being fought out within the terms of the contract and may end up in international arbitration courts.

Spain's public works minister flew out to Panama earlier in the year to mediate talks while the European Commissioner for Industry Antonio Tajani had also offered to mediate negotiations, an offer rejected by the Panamanians.

In its Wednesday statement, the Spanish-led consortium said the Panama Canal Authority had broken off the latest talks, but it did not spell out why. The GUPC said that, in its latest proposal, it had offered $800 million in new and existing funds, while asking the Panama Canal to put in $100 million in funds. It also asked the Canal to extend the deadline by which the consortium needs to return $785 million in advance payments made by the Canal in order to free up cash.

"It is unjust and impossible for the PCA and Panama to expect that private companies will finance $1.6 billion in costs on a project that was to be fully funded by PCA," the consortium said in the statement. It said the Panama Canal had not paid a pending $50 million invoice that had meant to cover salaries this week for subcontractors and workers.

"Without an immediate resolution, Panama and the PCA face years of disputes before national and international tribunals over their steps that have pushed the project to the brink of failure," the consortium added.

For Sacyr, which has 48 percent of the consortium, the work brings in a quarter of its international revenue. Like most Spanish builders, the company relies heavily on foreign orders to offset a sharp economic downturn at home.

Sacyr has provided 476 million euros in cash advances and guarantees to the project. One analyst said this was the worst-case scenario in terms of what losing the project would mean for the builder.

"But the actual impact will only be determined after several years in the courts if there is no final agreement," said Juan Carlos Calvo, analyst at Espirito Santo, adding that losing the contract would not represent a cash outflow for Sacyr as it affected cash advances already paid.

Any loss of the contract would also affect insurer Zurich , which had been involved with discussions. The insurer had proposed converting $600 million of surety bonds into a loan that would free up money to help complete the project a source with knowledge of the matter had said.

Editor's Comment: As predicted. The Panama Canal Authority had all (100%) of the negotiating power, while the GUPC had almost none. Their threats to walk off of the job (originally on 20 Jan, twice extended) fell on deaf ears, because they had, in fact, already laid off most of their work force at the end of the year. So, in fact, they had already stopped working.

Now the ACP can simply hire someone else. They can now spend the $1.5 billion (or more) needed to finish the Panama Canal expansion project. They also have the GUPC companies by the balls - one in each hand - because of the contract they signed. The ACP will be able to argue in international courts that the GUPC should have been able to build the project according to the contract they signed, and they should be able to squeeze the companies for the money necessary to actually build the damn thing. So, who's fucking who now, bitch? Welcome to Panama, where screwing over foreigners is a favorite pastime...

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Deadline looms in Panama Canal dispute talks

Canal ExpansionBy Marcus Hand - The deadline is looming in negotiations between the Panama Canal Authority (ACP) and lock gate contractor Grupo Unidos por el Canal (GUPC) with the Panamanian president Ricardo Martinelli saying they are very close to an agreement.

Talks over resolving a dispute over $1.6bn in cost overruns on the Panama Canal expansion project were extended until 4 February.

"They are very close to arriving at a happy conclusion ... But I prefer for us to give time to the parties, who have set tomorrow as the final day, so that it may be they (who announce results), but I'm sure that they are close to arriving at an agreement," the president told reporters on Monday.

"I'm sure that the parties, before tomorrow, can arrive at an agreement that will be satisfactory for (them all). I understand that they are on the verge of getting there."

As the deadline approaches neither party has yet made a public statement on the outcome of the talks. (

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Solis, Pinilla and Valdes Have Divided Power in the Electoral Tribunal

PoliticsIt seems the Electoral Tribunal has lost its sense independence, and even more so as one of the most disputed elections the country has ever seen draws closer, on 4 May 2014.

All power within the institution is literally controlled by three people who, as if in a privately owned company, divided among themselves key positions within the Electoral Tribunal where they have placed their family members, close friends, and acquaintances.

This situation is most concerning to the Independent presidential candidates, who are openly questioning the Electoral Tribunal's objectivity, upon having learned how the key positions within the institution have been divided up and distributed, including those people whose primary responsibility is to organize the electoral process, count votes, prepare the results, handle challenges, and other important tasks.

This distribution of positions has been going on since Gerardo Solis was the presiding judge, together with Eduardo Valdés Escofery and Erasmo Pinilla.

Although Gerardo Solis left the Electoral Tribunal on 15 November 2012 and is now the Vice Presidential candidate on the PRD ticket of Juan Carlos Navarro, he still controls 27 people who hold key positions of power within the TE, according to documents of the institution, to which the Panama America newspaper had access.

The designations made by Solís, Pinilla and Escofery are not only confined to national level positions, but they also extend to the provisional headquarters of the TE.

The other two judges, Pinilla and Escofery, control another 48 key positions each in the institution, including National Director positions, as well as Coordination Chiefs for the National Electoral System, who are responsible for the transmission of election data, among other strategic positions.

Some of those who are still active on the TE's payroll who were hired and placed by Solis are; Evangelista Ortiz, the Deputy Chief of the Electoral Commission who is also currently in charge of updating and auditing the Electoral Register; Rosalba Chin, Legal Deputy; Francisco Gómez, in charge of Election Results; Myrtha Varela, General Secretary, who is also in charge of the Commission for Appeals and Challenges, among others.

Editor's Comment: (The original article here goes on to name - by name - dozens of people who have been hired and place by the other judges of the Electoral Tribunal to key positions of power within the institution.)

Meanwhile, the judge who replaced Solis, Heriberto Arauz, has only been able to make three appointments within the TE, including his executive assistant and secretary, his bodyguard, and driver.

The Panama America newspaper contacted (several people) within the TE, but all decided to not make a comment.

Pinilla tried to justify the appointments by arguing that everyone goes through an evaluation process and a review of their merits, but he accepted are the judges themselves make the final decision.

" The judges make proposals, but the decisions (to hire) are made in the agreement room," said Pinilla.

What Judge Pinilla did not clarify is that the so called "agreement room" is comprised of the three judges of the TE.

Valdés also accepted that appointments to the TE are made by the judges, and he said that's why there are still people on the staff who were recommended by past judges who are no longer working in the TE. In this case he was referring to Gerardo Solis.

"If anything has characterized the Electoral Tribunal, it is the stability of the staff in their positions, based on their merits," said Valdes.

The Panama America tried to elicit a comment from Solis but he did not respond to the request.

Meanwhile, Eva Aime Alvarado, the Deputy Director of Human Resources, who was appointed by Solis, has denied that the former judge has any influence within the institution.

She said "the people who were appointed by Solis are quite competent, and that's why the other judges decided to stay with them."

Politicians and presidential candidates criticized the handling of appointments within the TE.

José Muñoz, the campaign manager for CD candidate José Domingo Arias, expressed concern about this situation.

"I do not see magistrates appointing persons of confidence to staff positions as a major problem, but that a former TE judge (Solis) with people who still hold positions of trust within the TE is another thing," he said.

"We hope the TE will maintain a level of confidence, as it did during the last elections, where the (legitimate) winner was recognized," he said.

Doris Zapata, the Third Secretary of the Democratic Revolutionary Party (PRD) , said key appointments in an institution like the TE should be made through a professional profile.

"For an institution to be transparent, they must fill these characteristics, and have recruitment rules as a priority," she added.

Meanwhile, independent presidential candidate Juan Jované thinks administrative processes within the institution should not be handled by "cronyism, rather - the appointments should be competitive."

This would avoid any uncertainty from being generated in something as important as an election process, said Jované.

He suggested that, as in the education system and the University of Panama, appointments to the TE should be made ​​through merit and contests.

Another independent presidential candidate, Gerardo Barroso, made ​​strong accusations against the judges - related to the control they wield within the institution.

"Not only do they control the institution at will, but they are also abusing their power, and they deserve to be removed for violations of the Electoral Code," Barroso claimed.

The candidate said it was the judges who are imposing a series of obstacles for independent candidates, including the subsidy payment for advertising campaigns. (Panama America)

Editor's Comment: So on the same day and article appears in La Prensa making allegations against the CD and their presidential candidate for using state gathered data for their electoral campaign, the government run Panama America newspaper comes back with their own allegations of abuses of power within the Electoral Tribunal. The fact of the matter is the CD and Ricardo Martinelli do not (currently) control the Electoral Tribunal - the PRD does. The CD only has one of the three judges and the Electoral Prosecutor in their back pocket. The rest are wild cards - and that makes them very nervous indeed.

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State Information - Available to the CD's Candidate Jose Domingo Arias

PoliticsThe ruling Democratic Change (CD) political party created a computer database to support the election campaign of their presidential candidate, José Domingo Arias, in which anyone with a user account and password can access the personal information about any Panamanian, including the details of their family, work and political affiliation.

The website, created in August 2013 by a company headquartered in Florida, provides information such as date of birth, political affiliation, if the person is currently working in a government position, or if they are participating in any of the government's social support programs such as 100/70 or the Guardian Angel program.

In order to conduct a search users only need to know the target's cedula number. The database also contains other personal information such as details on parents, siblings and even family acquaintances.

The purpose of this system, as revealed by a source who attended seminars held when the system was rolled out, is to build a network of supporters of the Arias campaign.

When a person registers, users punch in personal information, if they live near a polling station, if they have a car, and if they can transport more voters, or if their house can be used on election day.

There are four categories of participation; circuit leaders who recruit coordinators, they are supposed to each bring in 10 "multipliers," who in turn should represent 20 voters each. That is to say, each coordinator, in theory, should bring in 200 voters to the CD's presidential campaign.

Something similar was proposed by the President of the Republic and the CD political party, Ricardo Martinelli, during the party's convention on 15 December 2013. He called this strategy and "avalanche" of victory.

José Muñoz, the National Assembly Deputy from the governing CD party, who is also the campaign manager for Jose Domingo Arias, said he was unaware of this system. However, he asked for a chance to investigate.

"I get the impression this page was hacked," he said later. (Prensa)

Editor's Comment: Hacked? That's ridiculous. I love politicians who feel they can lie straight to the public's face when caught flat-footed on a question they were unprepared to answer. Of course Arias' campaign manager José Muñoz knew about this computer system. Their entire campaign strategy is built on "getting the vote out" and creating a sort of MLM structure for election day. Each "circuit leader" recruits ten "multipliers", and each "multiplier" then has to sign up 20 votes. Therefore, each "circuit leader" should bring them 200 votes in theory.

Listen, there's nothing wrong with an election campaign organizing their grassroots following in an effort to make sure everyone gets to the polls, has a ride, actually shows up to vote, etc. The real problem comes when the candidate for the ruling party has access to the information contained in official government computer databases, and then they use that same information to structure their recruiting efforts, and their push to get the voters to the polls.

And ask yourself, did the PRD to exactly the same thing when Balbina Herrera was their candidate and Martin Torrijos was president, leading up to the 2009 election? Of course they did, but with less sophistication. Martinelli is much more adept at using technology, so their effort is more likely to be successful. And will there be people who are going to complain about this? Of course. Will anything be done about it? Of course not. The Electoral Prosecutor is in the CD's back pocket. Politics, Panama style...

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Free eBook Helps Make Relocating to Panama Easy

Law & Lawyers

Relocating to Panama, let alone moving to any foreign country, can be stressful. Learning Panamanian laws, customs, and discovering how to get things done can take months, if not longer. That is why we've prepared a detailed Panama relocation checklist which will help make your move easier. And for a complete how to guide, download the free Panama relocation EBook.

Download Free Panama Relocation eBook

Panama Relocation Checklist

1. Research Panama Immigration Visas to see which one would be the best fit for your family. Panama has numerous permanent residency programs for entire families including pensioners, investors, businessmen, job offers, and even for citizens of 48 “friendly nations”. While Panama’s embassy and consulate websites can provide basic information, it is better to consulate with a Panama immigration lawyer as the rules and regulations are constantly changing and securing a visa without legal assistance can take a very long time.

2. Research the Types of Vaccines needed to relocate to Panama. The U.S. Center for Disease Control recommends contacting your doctor to determine what vaccines are necessary depending on your health, vaccine history and which part of Panama you will relocate to. For instance, make sure you are up to date with routine inoculations for mumps/measles/rubella (MMR) vaccine, poliovirus vaccine, and diphtheria/pertussis/tetanus (DPT) vaccine. The CDC website has a map of the world indicating Panama has an intermediate risk of Hepatitis A virus but no risk of contracting Hepatitis B Surface Antigen. Some areas east of the Panama Canal Zone heading towards the border with Colombia may require a Yellow Fever vaccination.

3. Research Customs Duty and Taxes for new vehicles and luxury items being shipped to Panama. As a foreigner on a pensioner visa in Panama, you are afforded special tax incentives when importing a car and household goods. Learn more here.

4. Bringing Pets to Panama requires rabies vaccines and specific forms from your vet and other documents. Learn about the specific steps to take when bring a pet to Panama in our free relocation EBook.

5. Medical Health Insurance covering travel to Panama may be purchased. However if you plan to fly to Panama City’s International Airport (Tocumen), you will receive a brochure explaining the government of Panama’s free medical insurance program covering you and your family for the first 30 days. After that period you can purchase health insurance plans in Panama. For information and contact details on the best hospitals and health insurance in Panama, read more here.

6. Gather Important Documents to take with you and have them Apostilled by your government within 3 months before applying for a Panama immigration visa, a Panama driver’s license, and opening a Panama bank account. These documents include:

  • Marriage and birth certificates
  • Passport, naturalization document, green card, proof of citizenship, etc.
  • Social security cards
  • Vaccinations, dental and medical records
  • Insurance policies
  • Academic records and diplomas
  • Employment records
  • Proof of residency (utility bills with your name and address)
  • Driver’s licenses
  • Original reference letter from your bank (two banks would be better) addressed to a specific Panama bank and signed by a bank official.

An Apostille is an internationally recognized method of authenticating government issued documents such as birth and marriage certificates and driver’s licenses. In the U.S., a state’s Secretary of State Office can do the Apostille.

7. Moving & Shipping: Locate an international moving & shipping company to help facilitate your moving needs. There are many options available, but it is recommended to read some reviews, compare prices, and look for recommendations.

8. Vehicle Insurance should be purchased and used while driving in Panama. Click here to learn more about Panama Vehicle Insurance.

9. Property Insurance is a good thing to have during shipping and relocation. There are international insurance companies who can provide coverage for expats and their relocation. Read this web page explaining Panama Fire Insurance.

10. Maintaining Bank and Credit Card Accounts requires notifying them of your move so they won’t treat you like an identity theft fraudster. Learn more about how to open a Panama Bank Account.

11. Prescription Drugs requires taking a quantity with you and obtaining the pertinent medical records which need to be kept in a safe place.

12. International Driving Permit must be obtained which will be carried with your original driver’s license. Find more information here on how to get a Panama Driver’s License and How to Drive in Panama.

13. Cancel Subscriptions to newspapers, magazines, and anything else which will be delivered or mailed to your former home.

14. Hotel & Flight Reservations should be made as soon as you verify your travel date.

15. VOIP Phone Service (Voice Over Internet Protocol) like the free Skype account to make free international calls.

16. Research the culture, neighborhoods, things you need which are not available (so you can stock up), schools, job opportunities, real estate prices, Spanish language schools, and Panama’s expat community groups and forums for networking. Download the EBook explaining all of these in details here: Panama Relocation EBook.

Panama Offshore Legal Services provides first-class legal advice, consultation, and various services to help make relocating to Panama more efficient and less stressful. Visit our website or download the Panama Relocation EBook to learn more.

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' There is a window of understanding '

Canal ExpansionThe administration of the Panama Canal and its largest contractor have engaged in what is expected to be the last and final attempt to not break the $3.1 billion dollar contract signed in 2009.

Yesterday, the Grupo Unidos por el Canal (GUPC) and the Panama Canal Authority (ACP) agreed to extend until Tuesday, the negotiation process to find a solution to the problems of insolvency faced by the consortium, and to complete construction of the third set of locks.

Jorge Luis Quijano, ACP Administrator, was optimistic in what could be the outcome of the process of conversation.

"There is a small window of understanding and we must seize it. We are willing to listen, and there is an opportunity to approach," said Quijano, who avoided revealing details due to a confidentiality agreement entered by the parties.

This newspaper (La Prensa) learned that the negotiation focuses on two aspects. The ACP would be willing to extend the moratorium (grace period) for prepayments of $783 million the consortium has received. However, the point in question would be how much time to give the GUPC for the grace period.

Furthermore, they are exploring the possibility that the GUPC might get $400 million from international banks, to use as a financial security support - for the same amount - from the insurance company Zurich American. (Prensa)

Editor's Comment: Who knows. Work in progress. I still won't be surprised if they can't reach a deal and the GUPC is eventually gone for good...

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Panama Canal, Contractors Extend Talks On Dispute

Canal Expansion(Fox News Latino) PANAMA CITY, PANAMA – The Panama Canal Authority, or ACP, said Friday that talks aimed at resolving a dispute with the contractors building a third set of locks for the waterway will continue through Feb. 4.

Though the parties set a deadline of Feb. 1 to reach agreement, they have now decided to continue negotiations through the weekend, the ACP said in a statement.

Discussions between the ACP and the GUPC consortium began Jan. 7.

Zurich Insurance Group, the guarantor of the expansion project, joined the process last week and will be part of the extended dialogue, the ACP said.

GUPC, which is led by Spanish construction giant Sacyr and Italy's Impregilo, confirmed Friday that talks would continue and that a threatened work stoppage would be delayed until at least Feb. 5.

The consortium formally notified the ACP on Dec. 30 that it would suspend work Jan. 20 if the canal authority did not agree to pay the contractors an additional $1.6 billion to cover cost overruns.

Since then, the date of the possible shutdown has been postponed twice.

"The objective of the negotiations has been, and continues to be, to reach an a long-term accord for the realization of the Panama Canal expansion project in the shortest time and at the lowest cost, within the contract and the law," GUPC said Friday.

Talks "center on a plan of co-financing the costs for the completion of the project. The ultimate responsibility for the additional costs will be decided through international arbitration proceedings," the consortium said.

Both the ACP and GUPC want to complete the third set of locks and the most convenient way would be "to finish together," but only within the terms of the original contract, canal administrator Jorge Quijano has said.

The ACP said on Jan. 7 it would advance the GUPC $100 million and give the consortium a grace period of two months to repay a previous advance of $83 million, provided the contractors also put up $100 million and withdraw their threat to suspend work.

The consortium countered by proposing the ACP fork out an additional advance of $400 million while also pledging to contribute $100 million of GUPC funds to keep the project running.

Another proposal, presented unilaterally by Impregilo and made public on Jan. 9, called for the canal authority to make an additional payment of between $500 million and $1 billion to the GUPC to cover cost overruns.

Quijano rejected both of those formulas as "outside the contract."

The contract for the locks, which is the centerpiece of a $5.25 billion canal expansion, was awarded to GUPC in 2009 and calls for the ACP to pay the consortium a total of $3.12 billion.

So far, the ACP has paid GUPC $2.83 billion, including repayable advances, plus an additional $180 million for cost overruns.

The Panama Canal, which was designed in 1904 for ships with a 267-meter (875-foot) length and 28-meter (92-foot) beam, is too small to handle modern ships that are three times as big, making a third set of locks essential.

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Drugs and Money Seized in Costa del Sur

Drug TraffickingAn estimated $635,000 in cash and 92 packets of cocaine were seized yesterday at Mansion #11 in the exclusive Sunset Coast housing development, in Costa Sur, located next to the Southern Corridor.

The seizure of drugs and money was achieved through a joint operation conducted by the National Police and Anti Drug Prosecutor.

At the scene police officers arrested one Colombian, two Panamanians, and two Guatemalans.

They also seized six cars, four of which had secret (double bottom) compartments. (Critica)

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Martinelli Fires Foreign Minister (His Cousin) Núñez Fábrega

Panama NewsBy Don Winner for - Panamanian president Ricardo Martinelli fired the Foreign Minister, his cousin Fernando Núñez Fábrega, again. What's this, like the third time for this guy?

When Martinelli first took office in 2009 his cousin Núñez Fábrega was appointed as the "Anti Corruption Czar." He didn't last very long in the position, which he used to make a whole lot of noise. He became such an insufferable pain in the ass, after awhile Martinelli got rid of him (promoted/fired him) by making him the new Governor of the Province of Coclé. Yeah. Send him off to the interior. That'll work...

Nope. That didn't last long, either. It seems wherever this guy goes, he makes waves and creates more problems than he's worth. There were all sorts of allegations of wrongdoing that followed him up to Coclé, that eventually Martinelli had to get him out of there, as well. So what did he do? He moved him again (promoted/fired) to be the new Foreign Minister.

I was amazed when Martinelli made him the Foreign Minister. Martinelli probably thought he couldn't screw that up too bad. But for me it was a real head-scratcher of a decision. Made no sense at the time, and I sort of predicted it wouldn't work out too well.

And now he's been fired again. Well, officially he supposedly resigned to take care of personal and family matters. That's what they all say. He was tossed. End of story. Maybe he will stay gone this time. That would be nice. Maybe he could make us a nice raspado or something.

It looks like Núñez Fábrega will be replaced by Francisco Álvarez De Soto, who was formerly the Vice Minister of Foreign Affairs. He resigned less than 24 hours after learning (at the time) Núñez Fábrega had been appointed as the Foreign Minister and would be his new boss. I like him already...

Copyright 2013

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Selection of First Lady as CD's VP Candidate Draws Ire

Politics Sectors of the civil society and recognized political figures repudiated the appointment of the First Lady, Marta Linares de Martinelli, as the Vice Presidential candidate for the governing Democratic Change (CD) and Nationalist Republican Liberal Movement (MOLIRENA) political parties.

The selection of Linares de Martinelli "constitutes an abuse of power and a disrespect for the constitutional and legal standards by Ricardo Martinelli and his government," said the lawyer Ricardo Alberto Arias.

According to him, the "spirit behind this is to control the next government," so that "he [Martinelli] can be elected" in period 2014-2019. (Prensa)

Editor's Comment: Yeah, everyone who is not a fan of the CD and Ricardo Martinelli is gnashing their teeth over this one. Clearly, this move will keep Martinelli at the very least close to the Executive branch of government. After Arias wins and his wife becomes the Vice President, Martinelli can spend five years fishing, making more money, screwing off - and playing the "who, me?" card for the press. He won't have to spend any time looking over his shoulder, either - because both the Legislative and Judicial branches will be dominated by the CD as well. So yeah, anyone who is not in the CD is - pissed. Aghast. Appalled. Unhappy. Frustrated. And screwed...

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Panama Needs to Clean Up Its Act

Corruption(A Bloomberg Editorial) With the world’s second-largest free-trade zone, Latin America’s fourth-busiest airport, four container-vessel seaports, the Pan-American Highway and numerous free-trade agreements, Panama is on its way to becoming the Singapore of the Americas.

And as Eric Sabo reports in the March issue of Bloomberg Markets magazine, the expansion of the Panama Canal now under way “is only part of the massive infrastructure spending that is propelling the Panamanian economy.”

Yet to reap the full benefits of such investment, and to address one of the hemisphere’s worst cases of economic inequality, Panama needs to follow Singapore’s lead in fighting corruption.

Singapore ranked fifth out of 177 countries in last year’s Corruption Perceptions Index compiled by Transparency International (the higher the rating, the less corruption); Panama was 102nd -- a drop of almost 20 places from the previous year’s index.

Executives surveyed by the World Economic Forum have pegged corruption as Panama’s biggest problem for business.

Many of the qualities that have made Panama a hub for global trade and finance also attract malefactors. Drug cartels from Mexico and Colombia take advantage of its location, dollarized economy and free-trade zones to move their products and launder their proceeds.

Panama’s low tax rates (including no wealth or foreign income taxes) make it a haven for those seeking to shelter or hide assets.

Revenues from the canal and huge investments in infrastructure -- a five-year public investment program of as much as $15 billion amounted to more than 50 percent of Panama’s 2010 gross domestic product -- feed temptations for misappropriation, bid-rigging and bribery.

And notwithstanding five successive elected civilian governments since the 1989 U.S. intervention that toppled General Manuel Antonio Noriega, Panama’s civil institutions and democratic culture remain weak.

Its judiciary is seen as lacking political independence: In 2012, the World Economic Forum placed it 132nd out of 144 countries in that regard.

The news media faces intimidation and harassment.

And President Ricardo Martinelli’s administration has been marked by scandals and efforts to amass executive power. As one U.S. diplomatic cable put it, the president “may be willing to set aside the rule of law in order to achieve his political and developmental goals.”

This May’s presidential elections offer Panamanians a chance to bring in a new administration that would attack corruption with greater urgency.

It could start with transparency -- for example, by posting online more details on corporate ownership and taking other steps recommended by the Organization for Economic Cooperation and Development.

Panama also has yet to sign on to the World Trade Organization’s government procurement agreement, which would ease concerns about underhanded dealings on billions of dollars in contracts.

Strengthening Panama’s judiciary and building up anti-corruption institutions will take time; in the interim, a few aggressive prosecutions of cases involving corruption and abuses of authority would be a good down payment on reforms to follow.

What has made tiny Singapore such a success is not just its freedom of commerce, after all, but also its outsized commitment to following the rules.

Editor's Comment: Nice thoughts, but it's not going to happen. The problem is that all three of the main presidential candidates are basically equal when it comes to corruption. Panamanians have already tried the Panameñista (Arnulfista) party in Mireya Moscoso - and her administration was seen as one of the most corrupt in the countries history (and, that's saying something.)

The PRD had their turn in office - twice - from 1994 to 1999 with Ernesto Perez Balladares and from 2004 to 2009 with Martin Torrijos. They proved to be no better than the Panameñistas. The news headlines over the past several years have been filled with a steady stream of complaints and legal actions against the corruption activities of these past PRD administrations.

That left the door open to the Democratic Change party and Ricardo Martinelli. His strategy has been simple. They decided early on they would simply build more and get more done in five years in office than in the previous 40 - and then they actually pulled it off. The list of completed infrastructure projects is impressive - and so is the amount of money they've been making off of those contracts.

So the bottom line remains the same. Corruption in Panama among politicians becomes a common denominator, so therefore it gets zeroed out in the political calculus. Panamanian voters already know all politicians are corrupt, so they can stop wasting their time trying to hire someone who is not.

Jose Domingo Arias is now poised to win the election in 2014 and for the first time since the end of the dictatorship era, a political party will "repeat" in office or stay in power after a five year term. That means the CD will end up having appointed each and every judge on the Supreme Court. They will own every judge on the Electoral Tribunal. They will own the Attorney General, and Electoral prosecutor. In fact they already have control of practically every position of power worth having, and those they don't hold now, they will have after the 2014 elections. Their span of control over the Judicial system continues to strengthen every day.

So, clean up corruption in Panama? Dude, what are you smoking? Why shut down the party right after the first round of tequila shooters? Things are just getting warmed up, and it's only going to get worse.

It's a great time to be a CD party loyalist, and a really (really) bad time for anyone with a PRD tattoo. The Panameñista party will continue its amazing shrinking act and will eventually contract down to meaninglessness underscored by insignificance. The CD's allies the MOLIRENA party will continue to grow and prosper as their wingman. The new FAD party and Independent candidates will suck up the left wing radical fringe voters, and will never have a chance of assuming power.

But I agree with the basic premise of this editorial. Corruption is bad in Panama. Cases are investigated and tried selectively as political weapons against opponents - so what little anti-corruption action you do see, even that is tainted. I've been chanting for years that "there's no judicial security in Panama" so don't expect to be able to take your case to the courts and win, because you won't win. The Panamanian on the other side has more money and connections than you do, so you're going to lose. It's a problem, but external pressure isn't going to make it go away. It's not going to be significantly reduced any time soon.

Expect corruption in Panama to get worse, before it gets better. And that's also saying something...

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Panama Canal says extends talks with consortium to February 4

Canal ExpansionBy Lomi Kriel (Panama City) (Reuters) - The Panama Canal Authority said on Friday it had extended a window for talks with a Spanish-led consortium expanding the waterway aimed at ensuring work continues on the project, which faces huge cost overruns.

The authority said it had agreed to continue talks until February 4 with the consortium, which had threatened to stop work on the project unless the canal foots the bill for $1.6 billion in unforeseen additional costs.

Earlier this month, the consortium, which is led by Spanish builder Sacyr, announced it could stop work by January 20. But it later said it would not call a halt on the project before at least the end of January.

"The parties agreed to continue meeting over the weekend to further evaluate the options aimed at reaching an agreement," the Canal Authority said in a statement.

Italy and Spain are both committed to finding a rapid solution to the dispute, Italian Prime Minister Enrico Letta and his Spanish counterpart Mariano Rajoy said on Monday.

The consortium also includes Italian builder Salini Impregilo, Belgium's Jan De Nul and Panama's Constructora Urbana.

Halting construction on the expansion would be a setback for companies eager to move larger ships through the century-old waterway, such as liquefied natural gas (LNG) producers who want to ship exports from the U.S. Gulf coast to Asian markets.

The canal and the consortium have traded proposals and counter-proposals to find ways to raise financing to keep work going while they deal with the cost overruns via arbitration.

The project was originally expected to cost about $5.25 billion, but the overruns could raise the cost to near $7 billion.

Work began on the expansion in 2007. The project, which is some 72 percent complete, will create a new lane of traffic along the canal and double its capacity.

Editor's Comment: Overall, the project is 72% complete. The progress on the largest contract to build the third set of locks - which is at the center of this conflict - is currently 65% complete. The GUPC has practically stopped working already, having laid off the majority of their employees. This is the second time they have agreed to extend their threat to stop working on the project. They clearly overplayed their hand, and now if they walk off the job they will be facing legal actions by the ACP for breach of contract. They keep talking, but in the end of the day there's no way in hell the ACP is just going to hand them (anywhere near) $1.6 billion dollars. My prediction remains. I think the GUPC will eventually be gone, and the ACP will hire someone else to finish construction.

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