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DE RUEHZP #1072/01 1562103
ZNR UUUUU ZZH
R 052103Z JUN 06
FM AMEMBASSY PANAMA
TO RUEHC/SECSTATE WASHDC 8197
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE
RUEHBO/AMEMBASSY BOGOTA 2316
RUEHCV/AMEMBASSY CARACAS 1028
RUEHQT/AMEMBASSY QUITO 0892
RUEAIIA/CIA WASHDC
RHEFDIA/DIA WASHDC
RHMFISS/JOINT STAFF WASHINGTON DC
RUEKJCS/OSD WASHDC
RHMFISS/CDR USSOUTHCOM MIAMI FL//J5/J2/POLAD//

UNCLAS PANAMA 001072 
 
SIPDIS 
 
SENSITIVE 
 
SIPDIS 
 
DEPARTMENT ALSO FOR WHA/CEN, INL AND INR/B 
SOUTHCOM FOR POLAD 
 
E.O. 12958:N/A 
TAGS: PGOV PREL PINR PM
SUBJECT: PANAMA CITY MAYOR PESSIMISTIC ABOUT CANAL 
 
REFERENDUM 
 
SUMMARY 
------- 
¶1. (SBU) During a brief but intense conversation on May 22, 
Panama City Mayor Juan Carlos Navarro told Emboffs that 
possibilities for the GOP to win a potential Canal 
referendum in 2006 are close to null.  Navarro, a usually 
cheerful and positive character, was pessimistic when 
explaining why he, and many Democratic Revolutionary Party 
(PRD) members and GOP officials, believe President Torrijos 
will embarrassingly fail in getting a "yes" vote in the yet- 
to-be scheduled Canal widening referendum.  Navarro cited 
poor political strategy, including clumsy political 
patronage on one hand, and unemployed and disgruntled party 
members on the other.  For example, he criticized GOP 
slowness to repair local social and infrastructure problems. 
In his frustration Navarro feels that the Canal referendum 
may have to wait.  End summary. 
 
Torrijos Pays No Attention 
-------------------------- 
¶2. (SBU) Navarro claimed that last March while flying 
together to the western province of Chiriqui, he told 
President Torrijos of his concerns about the possibility of 
losing the Canal referendum.  According to Navarro, Torrijos 
was surprised by his worries and ignored him.  PRD board 
members Balbina Herrera, Hector Aleman, and Navarro began 
making field trips to meet local PRD leaders to survey them 
on the referendum.  Navarro said that the group issued a 
detailed report for Torrijos explaining internal PRD 
disenchantment with his government and suggesting solutions, 
but Torrijos has taken no action yet. 
 
Ham-handed Patronage Committee 
------------------------------ 
¶3. (SBU) One of the suggestions included in the report was 
to give jobs to key unemployed party leaders, which Navarro 
thought could be easy to do.  "We would only need to hire 
around 2,500 more people but nothing has been done," Navarro 
complained.  Early in his administration, Torrijos 
established an unofficial committee ran by his personal 
friend Felix "Pille" Gonzalez to screen and approve new 
GOP/PRD hiring.  Navarro confided that Torrijos once 
complained that the GOP had already hired 40,000 people but 
that he couldn't "find them."  Navarro wondered if those 
40,000 PRDs were the right ones to hire and stated that the 
patronage committee is feathering its own nest.  For 
instance, two Cortizo siblings still hold GOP jobs, despite 
their brother Laurentino Cortizo's public resignation as 
Agricultural Minister on the eve of the FTA's ninth round. 
Cortizo's flamboyant walkout embarrassed Torrijos but most 
importantly ruined the conclusion of the FTA, a firm GOP 
goal at the time. 
 
Unreasonable Expectations 
------------------------- 
¶4. (SBU) Navarro claimed that Cocle provincial PRD Governor 
Dario Fernandez recently confided his increasing worries 
about having to promote the referendum in his province when 
their own party members were not behind them supporting the 
cause.  Lack of much-needed infrastructure solutions 
concerns Navarro as well.  "How do they expect our people to 
go to the communities and ask them to vote with us?  The 
people will ask `where is the bridge you promised us?'" 
Navarro stated.  Many rural communities in Panama face the 
same problem.  Navarro believes that it is already "too 
late" to think that small social projects would prompt a 
"yes" Canal expansion vote.  Even the $50M that the GOP put 
aside last January for this purpose won't help, he said, and 
"anyway, where are those $50M?  I haven't seen it!" Navarro 
added. 
 
Running for president 
--------------------- 
¶5. (SBU) Navarro, who confirmed that he will run for the 
sensitive but largely ceremonial job as PRD president in 
2007 and for PRD presidential candidate during the party 
primaries in 2008, shared with Emboffs that his campaign 
team is actively polling his presidential possibilities.  He 
told Ambassador that President Torrijos is supporting his 
candidacy for PRD president.  He also told Ambassador that 
Torrijos had promised to support his candidacy for President 
of Panama in 2009 if Navarro supported his candidacy in 
¶2004. 
 
Waiting Is Better Than Losing 
----------------------------- 
¶6. (SBU) Navarro's polls show anti-Canal referendum 
sentiment increasing and the "yes" supporters losing 
territory.  The polls, Navarro claimed, are nationwide and 
use a sample of 1200 people.  Navarro's concerns increase 
when asked what happens if the referendum fails.  "The GOP 
would become a lame duck.  The GOP is at stake, the party is 
at stake, I am at stake," Navarro remarked, adding that if 
polls continue to show the "no" vote growing, then it would 
be advisable not to hold the referendum in 2006.  Navarro 
believes that Torrijos made a mistake by holding a big, 
splashy event to launch the Canal expansion project.  By 
holding the event and giving a speech, Torrijos politicized 
the project.  Navarro considers that it should have been a 
Panama Canal Authority event instead and that delaying the 
referendum is a reasonable option to avoid losing it. 
 
COMMENT 
------- 
¶7. (SBU) Navarro's feelings reinforce those of opposition 
legislators who have told Emboffs that winning the 
referendum is becoming more questionable as days go by. 
Inevitably any referendum in Panama becomes a test of the 
government's popularity.  Lack of governing party unity is 
bad enough.  But added to increases in energy and 
transportation costs, a worsening crime rate, and higher 
income and property taxes threaten the referendum. 
Panamanians may "punish" the GOP via the referendum. 
 
Eaton