Caribbean & Central America - April 2018 (ISSN 1741-4458)

On 13 and 14 March Panama’s second-largest city, Colón, saw a combination of widespread peaceful protests coupled with violent clashes. Four police officers were wounded, 45 people were arrested, and Casa Wilcox, a dilapidated historic building in the city centre, was set alight. The paradox is that the renovation of Colón’s old city centre was a key election pledge back in 2014 when President Juan Carlos Varela took office; the government says it is spending nearly US$1.2bn on various projects to revive the city. Here we look at why local residents are still angry.

For many years Colón has witnessed urban decline, with the persistence of pockets of unusually high poverty and unemployment in an otherwise prosperous Panama. The city sits on the Atlantic side of the Panama Canal, its decayed buildings and poor drainage in sharp contrast with the steel and glass skyscrapers of Panama City only 80km distant on the Pacific side. Some have described the capital as a modern ‘mini-Dubai’. Colón’s heyday, manifest by the crumbling art deco splendour of many of its buildings, was in the early 20^th century when the Canal was built and began to operate. But in the rush for development it fell behind Panama City. When Panama took control of the canal in 1999 Colón was hit by the associated closure of nearby US military bases. More recently it has been hit again by falling turnover at the Colón free trade zone (known by its Spanish acronym ZLC).

Businessman René Quevedo has pointed out that over half a million new jobs were created in Panama in 2004-2017, but only 5% (one out of every 20) were located in Colón. There were no new jobs at all in the city in that period for the young – people aged under 30. The city has a very high concentration of ninis (the description of people who are neither in work nor studying). In fact, one in every three city residents of working age are ninis. Not surprisingly, perhaps, the city has a big problem with youth crime, gangs, and drug trafficking.

In theory, all this is being addressed by the government, which is spending US$1.2bn to turn the city around. The budget includes a US$537m project to renew the city centre, awarded in 2015 to a consortium including Odebrecht, the Brazilian civil engineering company that subsequently became notorious for its practice of paying bribes. In reality, however, the way the project is being implemented has attracted multiple criticisms. Leaders of the protests, such as Edgardo Voitier of the Comité de Lucha por la Salvación de la Costa Atlántica, have said that an undeclared aim is to move poor residents out the city centre to make way for gentrification and urban development exclusively for the rich. Voitier estimates that up to 80% of current residents of the old city might be moved out to the periphery as part of an undeclared “gentrification” project. “We suspect public money is being used to create a pretty new city, but it will be pretty just for the rich,” he says. Voitier argues that urban renewal “should benefit everyone: the rich, the middle classes, and the poor.”

Odebrecht’s involvement is seen as a sign of deeply embedded corruption. Some have pointed out that Colón is vulnerable to rising sea levels and this does not seem to have been born in mind in project planning. English-language website The Panama News has commented, “What we are seeing is a US$1.2bn investment premised on climate change denial,” suggesting that the city can only be protected from flooding by further multi-million-dollar investments in Dutch-style dikes and pumping stations. Critics have also pointed out there has been little effective communication with residents and that the short-term impact of the renovation project has been to worsen, not to improve, the state of city streets, sewers, water mains and storm drains. Work has been progressing slowly. To make matters worse a series of administrative and legal problems mean that many people who have bought affordable homes on the outskirts of the city and paid off their mortgages, still do not have proper legal title to them.

The government’s short-term handling of the issue has been less than optimal. On 10 March, days before the planned demonstrations, over 1,000 police launched early morning raids on suspected gang members in the city. In retrospect some believe this was an unnecessary provocation that may have motivated the gangs to hit back, using the protests as cover to go on a looting and arson spree. President Varela and some of his ministers hinted heavily that opposition parties may have been involved in the violence, earning him the counter-accusation of politicising the issue. Minister for the Presidency Álvaro Alemán spoke of “delinquent groups backed by people driven by political interests”. The protests came to an end after the government agreed to start negotiations with local residents and stakeholders (including business and labour groups). With the involvement of the relevant ministers, a total of four main negotiating committees have been set up covering education, health, transport and housing. Keeping the peace in Colón may be dependent on signs of early progress in these negotiations.