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RR RUEHWEB

DE RUEHZP #1659/01 2371606
ZNY CCCCC ZZH
R 251606Z AUG 06
FM AMEMBASSY PANAMA
TO RUEHC/SECSTATE WASHDC 8830
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE
RUEHCV/AMEMBASSY CARACAS 1070
RUEHUB/USINT HAVANA 0044
RUEAIIA/CIA WASHDC
RHEFDIA/DIA WASHDC
RUEKJCS/OSD WASHDC
RHMFISS/JOINT STAFF WASHINGTON DC
RUMIAAA/HQ USSOUTHCOM MIAMI FL
RHEHNSC/NSC WASHDC

C O N F I D E N T I A L PANAMA 001659

SIPDIS

SIPDIS

DEPARTMENT FOR WHA KIRSTEN MADISON; WHA/CEN; SOUTHCOM ALSO
FOR POLAD; NSC FOR DAN FISK

E.O. 12958: DECL: 08/23/2016
TAGS: PGOV PREL ECON
SUBJECT: PANAMA'S BOLIVARIAN ALTERNATIVE POLITICAL FORCE
(FPA) AIMS TO FORM POLITICAL PARTY; STRUGGLING FOR
LEGITIMACY

Classified By: Chief of Political Section Brian Naranjo for reason 1.4(
d)

--------
Summary
--------

¶1.  (C) Alternative Political Force (Fuerza Politica
Alternativa -- FPA) leader Olmedo Beluche said his goal was
to establish the Bolivarian FPA as a political party, in an
August 21 meeting with POLCHIEF and POL TDYer.  Beluche
underscored that his more immediate concern was reforming
Panama's "undemocratic" electoral law to make it easier to
register the FPA as a political party.  Beluche explained
that the FPA's "no" vote advocacy stemmed naturally from its
Bolivarian philosophy, opposition to "neo-liberal policies,"
and belief that Panama could not afford this expansion plan.
End summary.

--------------------------------------------- ----------
Oppose Canal Expansion, But More Important to Establish
Bolivarian Political Party
--------------------------------------------- ----------

¶2.  (C) Originally, this August 21 meeting was intended to
focus on FPA's "no" campaign on the October 22 canal
expansion referendum.  Beluche explained that FPA's
opposition to the Canal Referendum was a natural outcome of
its Bolivarian philosophy:  the project simply cost too much,
would increase Panama's external debt too much, and the money
would ultimately benefit Panama's wealthy at the expense of
those most in need.  Having quickly disposed of the reasons
for which FPA opposed canal expansion, Beluche moved on to
FPA's greater concern:  establishing itself as a registered
political party.

----------------------------------------
Electoral Law Sets Registration Bar High
----------------------------------------

¶3.  (C) Beluche underscored that his primary goal was to
establish his FPA as a registered political party in order to
compete in Panama's 2009 elections.  Unabashedly Bolivarian
and very pro-Chavez, the FPA formed in March 2006 as an
alternative political movement composed of over 15 small
populist organizations (e.g., the Bolivarian Circles of
Panama and the Communist Party).  While FPA had its roots in
and continued to coordinate with radical union FRENADESO
Beluche explained that FPA wanted the next logical step in
its political evolution:  formation of a party.  He
complained that Panama's "undemocratic" electoral law
presented an unfair hurdle.  When the National Assembly
reconvened in September, Beluche said FPA would focus on
reforming the electoral law to lower the bar for political
party registration.  (Note:  Currently, Panamanian law
requires that a new political party secure the signatures of
4 percent of voters (est. 66,000 signatures) and stipulates
that these signatures be collected in the offices of the
Electoral Tribunal (TE), not on petitions circulated by FPA.)
 Beluche asserted that these requirements were much more
stringent than in Costa Rica, Mexico, Brazil or even Panama
during its military dictatorships.  Furthermore, Beluche said
many existing Panamanian parties would be unable to get over
this hurdle if they had to register today.

--------------------------------------------- ------
On Target with Diagnosis; Prescription Off the Mark
--------------------------------------------- ------

¶4.  (C) FPA's diagnosis of Panama's problems tracks with the
diagnoses not only of other opposition parties, but also with
those of Torrijos Administration supporters and indeed most
political observers.  Beluche and his three colleagues
recited a litany of Panama's problems, for example:

--Governmental institutions were weak and crippled by
corruption;
-- The rising tide of economic growth over the past fifteen
years had not lifted all boats, and extreme poverty and vast


income distributions remained significant problems;
-- The education system was in a state of complete disarray;
and
-- Crime and insecurity were growing.

Where FPA differed, Beluche explained, was its prescription
about how to address Panama's problems.  While insisting that
they were not stuck on past failed political theories and
policies, Beluche and his colleagues recommended, among other
things:  nationalizing key industries (e.g., electric sector,
telephone services, heavy industry); implementing price
controls; controlling capital flows and preventing capital
flight, as their proposed method to bring equitable
development to Panama.  Open admirers of Venezuelan President
Hugo Chavez and Bolivian President Evo Morales, FPA proposed
advancing "true reform" through greater "participatory
democracy" and redrafting Panama's constitution by convening
a "constituent assembly."

--------
Comment
--------

¶5.  (C) Though Beluche nervously joked that he needed
"witnesses" to his conversation with U.S. Embassy officials,
Beluche and his FPA colleagues were very eager to share their
opinions with POLOFFS.  While it is hard to argue with their
diagnosis of Panama's problems, FPA's prescription would have
a disastrous impact on Panama, a quintessential cross-road
country that is thoroughly enmeshed through trade, banking,
and transport with the global economy.  The prospects that
FPA will be able to register as a political party are dim.
Panama's powers-that-be -- in both the Torrijos
Administration and the opposition -- do not view FPA
positively and are unlikely to lower the bar for party
registration to clear the path for FPA.  Furthermore, this
clique of university professors has no apparent following -
or even demonstrated ability to mobilize people - and would
face great difficulty amassing the necessary signatures.
Nonetheless, FPA ideas are provocative, and we will continue
to track this political movement.
EATON