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Latin American Economy & Business - February 2017 (ISSN 1741-7430)

Panama: Another Odebrecht blow

Panama is another Latin American country where the Odebrecht corruption scandal is having a negative impact on this year’s growth prospects. In its plea bargain deal with the US Department of Justice the company admitted paying US$59m in bribes to Panamanian government officials in 2010-2014. Kenia Porcell, a Panamanian prosecutor, opened a case file and said that Odebrecht had agreed to pay US$59m (an amount equivalent to the bribes paid) as an initial surety, pending the outcome of investigations. Unlike Peru, the Panamanian government has only formally banned Odebrecht from bidding for new government contracts and not issued a blanket ban on its participation in existing contracts. However, Odebrecht will still lose some of its existing US$3bn worth of contracts in the country. Job losses among its 8,000 employees are also expected.

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