News / Americas

Panama's President-elect Plans Price Controls on Basic Foods

Juan Carlos Varela of the Panamenista Party (PP) shakes hands with supporters during his first public presentation as the elected president of Panama outside the Virgin of Carmen church in Panama City, May 5, 2014.
Juan Carlos Varela of the Panamenista Party (PP) shakes hands with supporters during his first public presentation as the elected president of Panama outside the Virgin of Carmen church in Panama City, May 5, 2014.
Reuters
— Panama's president-elect will impose price controls on a range of basic foods to dampen rising costs, a step that will hit his bitter rival, outgoing president and supermarket tycoon Ricardo Martinelli.

Juan Carlos Varela, the Panamenista Party (PP) leader and winner of Sunday's election, told Reuters he is clear what his first policy will be when he takes office on July 1.

"Establish emergency price controls on 22 products in the basic basket to lower the cost of living by more than $600 million for the Panamanian people and avoid speculation in products," he said.

The measure would apply to basic foods such as rice, cheese and meat, Varela said, adding that huge profit margins were being put on basic foodstuffs.

"We feel that this is very unfair for the people," Varela, a 50-year-old U.S.-trained engineer whose family owns Panama's largest liquor company, said in an interview.

Martinelli, who Varela helped to win election in 2009 before the two fell out acrimoniously, owns one of Panama's largest supermarket chains. When asked if the controls would apply to Martinelli's stores, Varela said: "Without a doubt."

Panama's constitution gives the president power to intervene on prices, but Varela could quickly find himself at odds with Congress, where he and his allies won barely 20 percent of seats, according to a preliminary count from the elections.

At up to $624 per month, the minimum wage in Panama is high, but the country has a large informal economy and the cost of food has been running higher than overall consumer prices.

Annual inflation was trending lower last year and dipped further in 2014 to hit 3.3 percent in March. Food and drink prices have bucked that trend, and were up 5.1 percent on the year in March, up half a percentage point from December.

More Infrastructure

Varela won the presidential election with 39 percent support after he and his center-right alliance ran a campaign claiming credit for many of Martinelli's successful economic policies.

He has vowed to continue his rival's infrastructure spending and social programs, but in a more transparent way.

"I'm not going to raise taxes, my taxes are going to be on corruption," Varela said.

Panama's economy has grown at an average clip of 8.2 percent under Martinelli, one of the fastest rates in Latin America.

Varela said he expects it to post growth of around 6 percent on average during his five-year term.

Debt became an issue in the election as the public works boom and handouts for those outside the social security system have slowed the country's ability to pay it down.

Although debt has fallen, the strong growth has not led to significant fiscal consolidation, ratings agency Fitch says.

"We will use our cash flow to confront the debt, pay our creditors and also take on more debt and keep investing in the works that the Panamanian people need," Varela said.

During his term, he said Panama would invest more than $15 billion, mostly in big infrastructure projects such as at least two further metro lines in Panama City and social programs.

Although Panama's famous canal brings the government around $1 billion a year in revenue, the constitution prohibits politicians getting too involved in its administration.

Varela must, however, oversee a major expansion of the canal. Work was briefly suspended earlier this year by a dispute with the canal authorities and the building consortium.

Work ground to a halt again last month due to a nationwide strike over pay, raising more questions about the finish date.

Varela said he would seek to resolve the dispute when he takes office but declined to say whether the expansion would be completed by the current deadline of December 2015.

You May Like

As AIDS Epidemic Matures, Workplaces Adapt

Issue of AIDS in workplace is one of many social issues being discussed at the 20th International Aids Conference in Australia More

Is Air Travel Safe?

Aviation expert says despite tragic losses of Malaysian Airlines flights 370 and 17, industry experienced lowest fatality rate in recorded history last year More

Multimedia 100 Days Later, Nigerian Girls Still Held

Activists holding rallies in Nigeria and several other countries to mark 100th day of captivity for more than 200 schoolgirls being held by Boko Haram More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
IAEA: Iran Turns its Enriched Uranium Into Less Harmful Formi
X
July 22, 2014 10:26 AM
Iran has converted its stockpiles of enriched uranium into a less dangerous form that is more difficult to use for nuclear weapons, according to the United Nations’ Atomic Energy Agency. The move complies with an interim deal reached with Western powers on Iran's nuclear program last year, in exchange for easing of sanctions. Henry Ridgwell reports for VOA from London.
Video

Video IAEA: Iran Turns its Enriched Uranium Into Less Harmful Form

Iran has converted its stockpiles of enriched uranium into a less dangerous form that is more difficult to use for nuclear weapons, according to the United Nations’ Atomic Energy Agency. The move complies with an interim deal reached with Western powers on Iran's nuclear program last year, in exchange for easing of sanctions. Henry Ridgwell reports for VOA from London.
Video

Video Relic of Saint Draws Catholics Worried About Immigration Issue

A Roman Catholic saint who is a figure of devotion for those crossing the border into the United States is attracting believers concerned about the plight of undocumented immigrants. Mike O'Sullivan reports from Los Angeles, where a relic of Saint Toribio has drawn thousands to local churches.
Video

Video Ukraine Rebels Surrender MH17 Black Boxes

After days of negotiations, a senior separatist leader handed over two black boxes from an airliner downed over eastern Ukraine to Malaysian experts early Tuesday. While on Monday, the U.N. Security Council unanimously demanded that armed groups controlling the crash site allow safe and unrestricted access to the wreckage.
Video

Video In Cambodia, HIV Diagnosis Brings Deadly Shame

Although HIV/AIDS is now a treatable condition, a positive diagnosis is still a life altering experience. In Cambodia, people living with HIV are often disowned by friends, family and the community. This humiliation can be unbearable. We bring you one Cambodian woman’s struggle to overcome a life tragedy and her own HIV positive diagnosis.
Video

Video Nature of Space Exploration Enters New Age

Forty-five years ago this month, the first humans walked on the moon. It was during an era of the space race between the United States and the Soviet Union. World politics have changed since then and -- as Elizabeth Lee reports -- so has the nature of space exploration.
Video

Video Chicago’s Argonne Lab Developing Battery of the Future

In 2012, the U.S. Department of Energy’s Office of Science awarded a $120 million grant to a new technology center focused on battery development - headquartered at Argonne National Laboratory in suburban Chicago, Illinois. As VOA’s Kane Farabaugh reports, there scientists are making the next technological breakthroughs in energy storage.
Video

Video In NW Pakistan, Army Offensive Causes Massive Number of Displaced

Pakistan’s army offensive in North Waziristan has resulted in the large-scale displacement of the local population. VOA's Ayaz Gul reports from northwest Pakistan where authorities say around 80 percent of the estimated 1 million internally displaced persons [IDPs] have settled in Bannu district, while much of the remaining 20 percent are scattered in nearby cities.
Video

Video Kurdish Peshmerga Force Secures Kirkuk, Its Oil

The Kurdistan regional government has sent its Peshmerga troops into the adjacent province of Kirkuk to drive out insurgents, and to secure the area's rich oil fields. By doing this, the regional government has added a fourth province to the three it officially controls. The oil also provides revenue that could make an independent Kurdistan economically strong. VOA’s Jeffrey Young went out with the Peshmerga and filed this report.
Video

Video Malaysia Reeling: Second Air Disaster in Four Months

Malaysia is reeling from the second air disaster in four months involving the country’s flag carrier. Flight 340 vanished in March and despite an extensive search, no debris has been found. And on Thursday, Flight 17, likely hit by a surface-to-air missile, came apart over eastern Ukraine. The two incidents together have left more than 500 people dead. VOA Correspondent Steve Herman reports from Kuala Lumpur.

AppleAndroid

More Americas News

US Ambassador Calls for LGBT Rights

John Berry spoke at the 20th International AIDS Conference in Melbourne
More

China's Xi Praises Close Ties with Cuba

Head of China's Communist Party hails common socialist bond between his country and Cuba as he kicks off a state visit in Havana
More

US Judge Orders Argentina, Creditors to Reach Deal

Lawyers for investors who declined to restructure bonds after country defaulted on about $100B in 2002 warned that time running out to reach a deal, avert fresh default
More

Trial Imminent for Detained Venezuelan Protest Leader Lopez

Lopez's wife, Lilian Tintori, says outside pressure needed on Venezuelan president to move case forward
More

Sex Workers Seek HIV Prevention

The Lancet publishes new series on HIV
More

Texas Gov. Perry Orders State National Guard to Border

Governor says he took extraordinary measure to help secure the border, his critics say it is a political stunt
More