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LatinNews Regional Monitor: Caribbean & Central America - 18 April 2018

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Panama prepares for national strike by construction workers

Development: On 17 April, the Panamanian government led by President Juan Carlos Varela said that it would do all that is necessary to maintain public order.

Significance: The government assurances, given by Interior Minister María Luisa Romero, came ahead of a national general strike today (18 April) called by the powerful construction workers’ union Sindicato Único de Trabajadores de la Construcción y Similares de Panamá (Suntracs). The strike follows the breakdown of salary negotiations between Suntracs and the Panamanian chamber of construction (Capac) which began six months ago. With some 266 public works likely to be paralysed as a result of the strike, the unrest ups the pressure on the Varela government, which has been mediating in the talks, to reach a solution.

  • Comprising some 90,000 members, Suntracs has been calling for a 60% pay rise over a four-year period while the Capac is offering only 2% over the same time frame. The labour minister, Luis Ernesto Carles, has complained that both sides are being unreasonable.
  • Suntracs general secretary, Saúl Méndez, justifies the increase on the grounds that while the construction sector generated US$36bn over the last four years only just over US$5bn went on salaries for workers, engineers and administrators. However, Capac’s director Eduardo Rodríguez has told reporters that as long as the union maintains its demand, there will not be progress in the talks.
  • Méndez’s insistence that the workers have failed to reap the benefits of strong growth came as the International Monetary Fund (IMF) released its latest World Economic Outlook (WEO) yesterday, which forecast that Panama will lead Central America in terms of GDP growth in 2018 with a 5.6% advance. This is ahead of the Dominican Republic (5.5%), Nicaragua (4.7%), Costa Rica (3.6%), Honduras (3.5%), Guatemala (3.2%), and El Salvador (2.3%).
  • The prospect of unrest has met with concern from other private sector lobbies such as Asociación Panameña de Ejecutivos de Empresas (Apede) and the Cámara de Comercio, Industrias y Agricultura de Panamá (CCIAP) which have been urging the government to find a solution. It has also attracted concern from the association of users of Panama’s Colón Free Trade Zone (FTZ) – one of the world’s largest duty free trade areas - which in a tweet rejected Suntrac’s demands and warned of the impact of the protest on Panama’s image.
  • The national strike comes weeks after protests in Colón city, the capital of the eponymous province and Panama’s second city, over the slow progress of the government’s urban renovation project for the city – one of Varela’s flagship projects. Called by the Frente Amplio por Colón (FAC), an organisation which groups small business representatives, civil-society groups, and teachers, the protest made headlines due to the violence which ensued, leaving six shopping centres vandalised, at least four police officers injured, nine homemade Molotov bombs seized, and 35 people arrested.
  • President Varela, however, denied the complaints regarding the lack of progress of the project, which includes plans to restore 16 streets in the old town, to improve the electricity and sanitation networks, and to upgrade the local economy in general. The president said that the project – which he launched in July 2014 upon taking office – was 68% complete, with US$569m invested so far, of the total US$1.1bn earmarked for it.

Looking Ahead: As well as the national strike today, President Varela is due to face more unrest in Colón on 19 April with the FAC having called another strike in pursuit of its demands.

 

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