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Transitioning to and the Inauguration of the Laurentino "Nito" Cortizo


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July 1 holiday for presidential inauguration

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Posted 21/05/2019

Monday July 1 will be a public holiday for the inauguration of President-elect Laurentino "Nito" Cortizo. The Labor Code, says that “the day the President-elect takes office is a day of obligatory rest and The remuneration  and employees who work will be paid with a surcharge of 150 percent on the salary of the ordinary working day.”

 

https://www.newsroompanama.com/news/july-1-holiday-for-presidential-inauguration

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Panama smooth transition hits choppy waters

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Outgoing and incoming teams meet.

Posted 08/06/2019

After a week of seemingly smooth transition meetings between the outgoing Varela (Panamenista)   and the incoming Cortizo (PRD) administrations. the amity frayed over concerns expressed by vice- president-elect José Gabriel Carrizo.

On Friday, June 8, Carrizo, after a meeting with the comptroller Federico Humbert, complained about the lack of information on the state of public finances with reduced income and greater spending, and, asked Humbert not to sign new contracts that could further deteriorate the public funds.

The  remarks upsert Minister of Economy and Finance,  Eyda Varela de Chinchilla, shot back. "It seems to us that it is not likely that after 14 hours of transitional sessions [in the MEF], after providing information and explaining actions taken, we spread false information," she said.

President Juan Carlos Varela described Carrizo's statements as "unprofessional and unwise" and said he spoke to President-elect Laurentino Cortizo to complain about the intervention.

 II is not the first time that the incoming government talks about the financial constraint it might face once it takes office on July 1, and has suggested even reduction of operating expenses.

' Gabriel Carrizo, who complained about the lack of reports on the current situation of public finances and, asked the comptroller Federico Humbert not to endorse "last minute" expenses or new contracts that could be harmful to the State.

During a visit to the Comptroller's Office, Carrizo warned that "we still do not know with certainty what the state of public finances is."

"We asked the comptroller for the status of accounts payable and other collection procedures submitted to the Comptroller's Office and not yet endorsed, as well as the status of contracts in process," Carrizo said.

It is not the first time that the incoming government speaks of the financial constraints it might face once in power, and even explores the application of a reduction  of operating expenses.

"These figures must be known much faster. We still do not know with certainty what the state of public finances is ... This must be improved. Our team, led by Hector Alexander [designated Minister of Economy and Finance], is in permanent work to achieve this and the Comptroller has made available, in conjunction with the outgoing government, to try to reveal the truths to Panamanians about the and Panamanians of that state of public finances, "said Carrizo.

The figures that  worry Carrizo are associated with the increase in public spending and the fall in revenues, which caused a negative balance during the first quarter of this year, which closed with a fiscal deficit of $966 million. This equals  1.4% of gross domestic product (GDP).

The deficit generated between January and March 2019 is below that required by law, "which means that we have good behavior," said Varela de Chinchilla at the time.

However, compared to the fiscal deficit of the first quarter of 2018, when it was $496 million or 0.8% of GDP, this year it rose $470 million.

"That kind of statement must be made in coordination with the outgoing government. This type of situation should not be created for the population. I just told the president-elect,” Varela told La Prensa.

He also questioned Carrizo's request to Humbert, since he considers that the Comptroller's Office is not the appropriate channel for the Vice President-elect to request a report on public works since the Executive is responsible for its execution.

"To give orders to the comptroller here is inadmissible …  I don’t know in which part of the country's Constitution it appears that an elected vice president gives instructions to a comptroller, who is chosen by the Legislative Assembly. , "he remarked.

The comptroller clarified that the law limits the outgoing administration not to affect the budget on the issue of operating expenses, but not on investment.

By law, in the years in which the change of government occurs, the outgoing administration (which governs from January to June) can only have up to 50% of the general operating budget, and the incoming administration (July-December) has 50 % remaining.

50% of the operating budget "cannot be touched, to ensure that funds are available for the next administration. However, there is no law that limits the ability to invest or use in investment projects the money that is in the budget.

 

https://www.newsroompanama.com/business/panama-smooth-transition-hits-choppy-waters

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  • Moderator_02 changed the title to Transitioning to the Laurentino "Nito" Cortizo Administration
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President elect asked to exit  Panama from “Den of thieves”

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Martinelli takes the oath of allegiance to the den

Posted 10/06/2019

A letter calling for Panama to leave the Central American Parliament (Parlacen)  by constitutional means is on its way from the Citizen Awareness Movement. to the president elect  Lorentino Cortizo  

Parlcen was formed in 1991 and has had more pain than glory because the criticisms go beyond its operation but also of the figures that make it up and how it is chosen reports TVN.

 In Panama, on the campaign trail that led him to the presidency, former President Ricardo Martinelli called it a "den of thieves" and proposed that the country leave. But within  24 hours pf after finishing his term when he fled the country he became part of it, and later used his membership as a legal maneuver in his arraignment for illegal spying.

Several of the recently appointed figures, including  Martinelli’s sons, received a hail of criticism from the public. According to Ábrego, its constitution includes objectives such as being a forum for analysis of economic, political and social issues, proposing international treaties to satisfy the region's needs, promoting peaceful coexistence among nations and the strengthening of democracy.

 "That's what is on paper, but when you go into practice you realize that it is something different from how that constituted treaty has been positioned," said Abrego. He argued that they establish immunities and privileges,  " unconstitutional in the Republic of Panama ."

A total of 40  Panamanians were elected to Parlacen, .Abrego said that of the 40, 17 have been convicted or are being investigated and reported to be involved in crimes against public administration (embezzlement), an issue that is common,  in the region. Abrego stressed that no projects are planned by these parliamentarians. " It is an inoperative institution, has no role to play and with high state cost ."

He said each principal deputy earns $4,200 a month," a high cost for people who are not fulfilling a role. It is an institution that protects criminals, "

. According to Ábrego, the Parlacen did not include in its treaty any way to withdraw, but when this situation occurs the country must go to the Vienna Convention of 1969, but the endorsement of the rest of the member countries is needed, which could not be done in 2009, because other nations opposed it.
 

https://www.newsroompanama.com/news/president-elect-asked-to-exit-panama-from-den-of-thieves

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King Felipe of Spain heads  weekend arrivals of leaders

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King Felipe Vl

Posted 27/06/2019

King Felipe VI of Spain, will arrive in Panama on Saturday, June 29, at 7 p.m. for the inauguration of President-elect Laurentino Cortizo.

Earlier in the day , Brahim Gali, president of the Sahrawi Arab Republic, will arrive on a  commercial flight.

On Sunday, June 30, presidents Martín Vizcarra, from Peru, Juan Orlando Hernández, from Honduras; and Jimmy Morales, from Guatemala will arrive.

The inauguration of Cortizo will be on Monday, July 1, at the Atlapa Convention Center.  Monday will be a national holiday

 

https://www.newsroompanama.com/events/king-felipe-of-spain-heads-weekend-arrivals-of-leaders

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  • Moderator_02 changed the title to Transitioning to and the Inauguration of the Laurentino "Nito" Cortizo
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US inauguration delegation with business twist

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Posted 27/06/2019

The delegation  selected by US President Donald Trump to attend the  inauguration of, Laurentino Cortizo, on July 1  has a strong business emphasis.

It will be led by Wilbur Ross, Secretary of Commerce and American investors. Before taking office, Ross was a well-known banker dedicated to buying and restructuring bankrupt companies.

The delegation, largely made up of businessmen will also  include Marshall Billingslea, deputy secretary of the Treasury against the Financing of Terrorism of the US Department of Treasury.

In addition, the adviser to President Donald Trump and director of the National Security Council for Western Hemisphere Affairs, Mauricio Claver-Carone, will attend.

Claver-Carone is a lawyer known for his strong criticisms of the governments of Cuba and Venezuela

Also attending are  Julie Chung, Assistant Principal Assistant Secretary for Western Hemisphere Affairs of the Department of State; Roxanne Cabral, interim mission chief of the US  Embassy in Panama, and Ulrich Brechbühl, advisor to the Department of State.

 

https://www.newsroompanama.com/business/us-inauguration-delegation-with-business-twist

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Costa Rica protests  end president's Panama trip

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Carlos Alvarado

Posted 29/06/2019

The president of Costa Rica, Carlos Alvarado, will miss Monday’s investiture of  Laurentino Cortizo as the new president of Panama,  as he faces two major protest movements at home.

Vice-president, Epsy Campbell, will attend in his place while Alvaradodeals with protests by students and truckers that started on Thursday.

 School students have blocked roads to demand the exit of the Minister of Education, Edgar Mora.

While the truckers have made slow-moving convoys and road closures,  to demand an exemption from the collection of 13% VAT, which goes into effect from Monday as part of tax reform.

 

https://www.newsroompanama.com/news/costa-rica-protests-end-presidents-panama-trip

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Unity the first challenge for new government

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IINCOMING president Laurentino Cortizo

Posted 30/06/2019

The first challenge facing the new government will be for Panamanians to feel that it is managed for everyone, regardless of who they voted for  favored in the last general elections says Panama’s Chamber of Commerce in its weekly newsletter on the eve of the presidential inauguration

“Unity and the spirit of collective work to achieve shared goals should be the signs that guide us during the next five years"   says the Chamber

Justice and transparency
"The separation of powers as a punctual definition of institutionality; a complete independence of justice; the probity of the officials, the transparency and the rendering of accounts on the part of the authorities, as well as the honesty in the handling of the public and private subjects must be reinstated elements in the daily task of the life of the country to recover a confidence that inspires us all to perform with a sense of belonging and pride of nation, " it said.  

The political forces of the country, of the government and the opposition have to frame their corresponding agendas that, instead of hindering, favor the execution of the identified plans to reactivate the economy, as well as to promote the transcendental changes that, education, health, social security and institutionality, have been waiting for decades for efficient and effective responses says the group.  

“It is time to establish sustainable State policies in time that transcend administrations and give us an always hopeful north to the children of Panama and those who live with us … These are not utopian or unrealizable aspirations”  the CCIAP said. 

 

https://www.newsroompanama.com/business/unity-the-first-challenge-for-new-government

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I golf with one of the members of Panama City Chamber Of Commerce. He made the same statements as this article to me months ago. He has the inside information. After all, he is the new President's brother-in-law. We will see-----the assembly has a lot of control over this country that needs to be changed. Corruption and the Assembly will be the first problems to be solved in my opinion. He was on the Chamber Of Commerce long before Nito ran for office.

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No individual above national interests - President Cortizo

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Posted 01/07/2019

"Listen well ... No individual interest ... political or economic ... will ever be above national interests ... And they are not negotiable!" said Laurentino Cortizo in his first speech as president of Panama on July 1.

"There will be no untouchables ... even if they are Ministers ... Deputies ... great businessmen ... And starting with the President himself …

“I reiterate to the Prosecutors, Judges, and Magistrates ... you owe it to the Homeland and to your own conscience ... not to political or economic pressures ...  And less to me!"

Some of the other points he made:

"Today ... there are 777,000  Panamanians living in multidimensional poverty ... 450,000 children and adolescents ... are poor"

"Corruption robs us all and threatens our future …"It intoxicates patronage and generates public distrust "Public funds are and will be sacred ... We all have to render an account to the country ..."

"In this month ... we will present to the Assembly the base proposal for reforms ... to endow Panama with a new constitutional order"

"We will guarantee that the Glass of Milk Program ... is 100% of nationally produced... likewise, we will begin the design of the  Study Without Hunger Program

"In the first three months ... we will present the law for the creation of the Ministry of Culture"

"In the coming months ... we will start operations of the Bank of Opportunities ... for the promotion of entrepreneurship ... especially for our youth and women"

 

https://www.newsroompanama.com/news/no-individual-above-national-interests-president-cortizo-1

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New president promises “Good Government”

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Out with the old, in with the new as seen by La Prensa poliitical cartoonist Low.

Posted 01/07/2019

Laurentino Nito Cortizo Cohen, a 66-year-old business administrator and member of the Democratic Revolutionary Party (PRD), is the seventh president of Panama in the democratic era.

He succeeds  Juan Carlos Varela, a 55-year-old engineer, of the Panameñista Party.

The new ruler arrives at Palacio de las Garzas in the midst of comfortable expectations, generated by his campaign promises: reactivate the economy, constitutional reforms, structural changes to various entities, revive agriculture, greater citizen security and govern away from partisan interests reports La Prensa

He  will have a National Assembly with 40 of the 71 deputies in his favor after a fractious five years of changing alliances and party infighting.

New judges
During  his term he will have to appoint six new magistrates of the Supreme Court and five members of the board of directors of the Panama Canal Authority.  with  his Assembly majority, they are likely to get fast acceptance and open the way for a clean up of the judicial system

Marcos Castillero was selected on Saturday, June 30  as president of the National Assembly for the period from July 2019 to July. 2020

The PRD won the majority of the seats in the Legislative in the elections of May 5: 35 deputies out of 71. And with its allied party, the Molirena has  a caucus of 40.

 

https://www.newsroompanama.com/news/new-president-promises-good-government

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The Cortizo Era Begins

Laurentino Cortizo, who came to power after promising a campaign to reactivate the economy, make constitutional reforms and make structural changes in several entities, assumes the presidency of Panama on July 1.

Monday, July 1, 2019

Laurentino Nito Cortizo Cohen, a member of the Democratic Revolutionary Party, won the presidential elections by a narrow margin at the beginning of May, concentrating nearly 33% of the votes. Cortizo's electoral victory comes against a backdrop of Panama's economic slowdown, since in 2018 the country's Gross Domestic Product reported a 3.7% year-on-year growth, far from the increases of 11.3% and 9.8% reported in 2011 and 2012, respectively.

See "Panama Has a New President

The expectations for Cortizo's mandate to fulfill its promises are high, since one of its advantages is that in the National Assembly, 40 of the 71 deputies will be in his favor.

Jorge Juan de la Guardia, president of the Chamber of Commerce, Industries and Agriculture of Panama (CCIAP), believes that "... for example, the agricultural, commercial and industrial sectors, as well as tourism, need a dynamic boost that allows them to contribute their full potential to economic growth, an aspect that generally demands conditions that ensure our local and international competitiveness, from whose hands comes foreign investment, necessary to generate all the jobs we need."

The businessman adds that "... The separation of powers as a punctual definition of institutionalism; a complete independence of justice; the probity of officials, transparency and accountability on the part of the authorities, as well as honesty in the handling of public and private affairs, must be reinstated elements in the daily life of the country to recover a confidence that inspires all of us to perform with a sense of belonging and pride of nation."

One of the negative situations that the new administration will have to face is that Panama has returned to the list of nations that need to be supervised in the process of implementing measures to prevent money laundering and the financing of terrorism that was issued by the Financial Action Task Force (FATF).

 

https://www.centralamericadata.com/en/article/main/The_Cortizo_Era_Begins

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OPINION: From saying to doing

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Posted 02/07/2019

In a realistic speech, which highlighted the challenges it faces, the new President of the Republic, Laurentino Cortizo Cohen, presented the country with his vision and commitment for the next five years. The Panamanian leader offered austerity and frugality, respect for public funds and equal treatment for all or, in other words, "non-existence of untouchables" neither among the political class nor among the business elite. In addition, he distanced himself from the calls to impart justice, in what is interpreted as a vote of respect for the independence of the powers. In his message, he said that in the first months of his mandate he will be sending important initiatives to the National Assembly, but he did not highlight any specific proposal to fight corruption. Faced with the situation of public finances and the promise of reactivating the economy, the head of state stressed his purpose of halving travel and travel expenses abroad, paying outstanding bills to state suppliers and promoting the real estate sector. In his message, he acknowledged that what was stolen in the past could be destined for better purposes and he promised to carry out works without robbing the people. Panamanians welcome President Cortizo's speech with optimism, especially the emphasis placed on the ethical issue as the head of his administration. As of today, it is up to everyone to be vigilant to ensure that the self-described "first worker of the country" knows how to move from saying to doing. – LA PRENSA, July 2.

 

https://www.newsroompanama.com/opinion/opinion-from-saying-to-doing

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Fitch gives new president cautious thumbs up

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Posted 02/07/2019

Laurentino Cortizo's first speech as president  and his fiscal conservatism produced a favorable reaction from the  Fitch rating agency on Tuesday, July 2 

A statement, says that the new administration is likely to maintain the continuity of economic policies while prioritizing constitutional reform to strengthen institutions.

The rating agency said that "the maintenance of policies oriented to the existing market will contribute to macroeconomics, stability and will support the forecast of a stronger growth of the Gross Domestic Product (GDP) in 2019-2020. 

However, it predicts that the incoming administration will face fiscal challenges with the weakening of tax collection, the reported accumulation of arrears and promises to increase social spending, which could complicate compliance with the deficit ceiling, except reforms. to boost government revenues.

The agency expects President Cortizo to prioritize a constitutional review with the aim of strengthening institutions, strengthening the separation of powers and improving controls and balances.

According to Fitch Ratings, "a constitutional review requires a two-thirds majority in Congress through two legislatures before being approved by popular referendum." 

The fiscal deficit of the Non-Financial Public Sector (NFPS) reached 1.4% of GDP in the first quarter of 2019, an increase of 0.8% compared to the same period of 2018, due to a decrease in revenues of 7% year with year. Revenue was weak due to slower growth and structural weakness in the collection of taxes, together with arrears than the total administration revenue of $1 trillion, which may affect compliance with the deficit limit of 2% of GDP.

The rating agency noted that "the outgoing government amended the Fiscal Social Responsibility Law (LRSF) simplifying its framework, but allowing greater deficits until 2021, repeating a pattern of postponement of consolidation objectives.

 

https://www.newsroompanama.com/business/fitch-gives-new-president-cautious-thumbs-up

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Panama: How Does Fitch Think About the New Government?

The qualifier is expecting that with the arrival of Laurentino Cortizo to the presidency, "priority will be given to a constitutional review aimed at strengthening institutions, reinforcing the separation of powers and improving controls and balances.”

Tuesday, July 2, 2019

On July 1, Laurentino Cortizo assumed the presidency of Panama, who assumed power after promising a campaign to reactivate the economy, make constitutional reforms and make structural changes in several entities.

Cortizo takes power in a context of economic slowdown in Panama, since in 2018 the country's Gross Domestic Product reported a 3.7% year-on-year growth, far from the increases of 11.3% and 9.8%, reported in 2011 and 2012, respectively.

See "Cortizo Era Begins"

From the Fitch Ratings statement:

Fitch Ratings-New York-01 July 2019: Panama's new administration is likely to maintain broad economic policy continuity while prioritizing constitutional reform to strengthen institutions, says Fitch Ratings. Maintaining existing market-oriented policies will contribute to macroeconomic stability and supports our forecast for stronger GDP growth in 2019-2020. However, the new administration will face fiscal challenges amid weakening tax collections, reported accumulation of arrears and pledges to increase social spending, which could complicate compliance with the fiscal deficit ceiling, barring reforms to boost government revenues.

Laurentino Cortizo from the center-left Partido Revolucionario Democratico (PRD) was sworn in as Panama's president for a five-year term on July 1. The election outcome denotes broad policy continuity as the campaign focused on corruption and transparency rather than macroeconomic policy. 

As a result, President Cortizo is expected to prioritize a constitutional revision aiming to strengthen institutions, reinforcing the separation of powers and improving checks and balances. A constitutional revision requires a two-thirds majority in Congress through two consecutive legislatures before being approved by popular referendum by YE20 at the earliest. Constitutional reforms are not uncommon in Panama, the latest being in 2004.

Legislative elections resulted in a favorable congress for the new administration. Cortizo's PRD party secured 35 seats out of the 71 seats of the unicameral assembly, meaning that the government will need only one more seat in Congress to attain a simple majority and pass legislation.

Panama's non-financial public sector (NFPS) fiscal deficit reached 1.4% of GDP in 1Q19, up from 0.8% a year prior, due to a 7% year-over-year decline in revenues. Weak revenues due to slower growth and structural weakness in tax collections, coupled with arrears that the incoming administration totals at USD1 billion, may affect compliance with the deficit ceiling of 2% of GDP. Tax collection underperformance has led to an uneven track record of compliance with the fiscal rule. The fiscal deficit reached 2.1% in 2018, slightly above the 2% ceiling, and there has been a gradual increase in government debt. However, ample international market access eases financing constraints arising from current fiscal trends.

The outgoing government modified the fiscal responsibility law by simplifying its framework but allowing higher deficits through 2021, repeating a pattern of postponing consolidation targets. The modified LRSF sets limits on the NFPS deficit of 2.0% of GDP in 2018 and 2019, 1.75% in 2020 and 2021 and 1.5% thereafter.

Cortizo's administration is expected to present pension reform as the unfunded defined benefit component of Panama's mixed pension system enters into a cash deficit. The latest actuarial estimates show that reserves could be depleted by 2027 absent any parametric reform.

Accelerating economic growth beginning this year should help contain fiscal pressures. Economic growth softened to 3.7% in 2018 from 5.3% in 2017 and decelerated further to 3.1% in 1Q19 mostly due to construction and slowdown in commerce. However, economic activity is expected to recover given new mining operations and ongoing public infrastructure programs. The Minera Panama copper mine, which anticipates yielding USD2 billion at peak capacity, three times Panama's goods exports, began production February 2019. Fitch expects real GDP growth will rise to 4.7% in 2019 and 5.3% in 2020.

Despite government progress in strengthening its Anti-Money Laundering and Combating the Financing of Terrorism framework, shortcomings in its effectiveness resulted in Panama being placed back on the FATF's "gray list." The impact of this remains uncertain. Panama did not exhibit an extended macroeconomic impact when placed on the "gray list" in 2014. The country lost 74 corresponding bank relationships in 2015-2016 but 92 have since been established. Smaller financial institutions are more susceptible to this risk.

 

https://www.centralamericadata.com/en/article/main/Panama_How_Does_Fitch_Think_About_the_New_Government

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