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C O N F I D E N T I A L SECTION 01 OF 05 PANAMA 000120 
 
NOFORN 
SIPDIS 
 
E.O. 12958: DECL: 02/04/2019 
TAGS: PGOV PM
SUBJECT: PANAMA:  HEAD-TO-HEAD RACE FOR PRESIDENCY BEGINS 
 
Classified By: Ambassador Barbara J. Stephenson.  Reasons:  1.4(d) 
 
------------------- 
Summary and Comment 
------------------- 
 
¶1. (C//NF)  Summary:  In a remarkable turn of events in 
Panama, there will be a head-to-head race for the presidency 
as governing Revolutionary Democratic Party (PRD) nominee 
Balbina Herrera heads off against Democratic Change (CD) 
presidential nominee Ricardo Martinelli and "Alliance for 
Change."  Panama's general election campaign season opened 
the week of February 2 with the formal closure of the 
candidate registration period.  Panama's general elections -- 
in which every elected position in Panama from president to 
the lowest city councilmember will be up for grabs -- will be 
held on May 3.  The new president and all other elected 
offices will be inaugurated on July 1.  For the first time 
since the late 1980s, Panama will witness a head-to-head race 
between the PRD and a unified opposition force: 
 
-- Martinelli will head a grand opposition alliance, "The 
Alliance for Change."  Bringing into his coalition Panama's 
largest opposition party, Martinelli concluded an alliance 
with the Panamenista Party and named Panamenista presidential 
nominee Juan Carlos Varela as his VP running mate.  The 
Patriotic Union (UP) and Movement of Liberal Republican 
Nationalists (MOLIRENA) will round out the opposition 
alliance. 
 
-- Herrera in turn heads into the 2009 election continuing 
the PRD's alliance with the Popular Party (PP) and the 
Liberal Party (LP), two minor parties that joined with the 
PRD for the 2004 elections that carried Martin Torrijos to 
the presidency.  Internal divisions within the PRD, Panama's 
largest political force, have not been higher at least since 
Manual Antonio Noriega was removed from power in December 
¶1989. 
 
According to Dichter and Neira's first February poll 
(SEPTEL), Martinelli enjoys 55 percent support leading 
Herrera by 23 points.  Policy debates and dueling governing 
proposals are unlikely to play much role in the campaign that 
will unfold in the coming weeks, but rather the election will 
turn on the issue of who voters trust to bring change to 
Panama, a recipe for an ugly, uninspiring food fight of a 
campaign season as both sides smear each other.  End Summary. 
 
¶2. (C//NF) Comment:  The 2009 general elections will look and 
feel very different from any other election over the past 
twenty years: 
 
-- The PRD is more disunited than at any point since the late 
1980s; 
-- The opposition is more united than at any point since the 
late 1980s 
-- There will not be a Panamenista (Arnulfista) candidate for 
the presidency, but rather the standard bearer for the 
opposition comes from a party that did not even exist twenty 
years ago; 
-- PRD standard bearer Herrera, though burdened by her own 
left-wing and populist past, is currently running a 
conservative campaign based on continuity with the current 
administration's moderate policies; and 
-- The most populist candidate on the scene is conservative, 
exceedingly pro-American supermarket magnate Martinelli. 
 
In this scrambled Panamanian political panorama, independent 
voters will ultimately have the final say as to which 
political force to entrust with governing Panama for the next 
five years. In 2004, Torrijos won election with about 47 
percent of the vote.  In 2009, the presidential victor may 
secure a majority of voters support.  End Comment. 
 
--------------------------------------------- - 
Martinelli Pulls Off Grand Opposition Alliance 
--------------------------------------------- - 
 
¶3. (C//NF) Coming right down to the February 2 deadline for 
registering candidates formally with the Electoral Tribunal 
(TE), Martinelli sealed a grand opposition alliance by 
bringing the Panamenista Party into the fold of his "Alliance 
for Change."  Martinelli named Panamenista presidential 
nominee Juan Carlos Varela as his VP running mate, moving 
aside hapless UP National Assembly Deputy Leopoldo Benedetti 
who had been penciled in for this slot.  Accepting second 
billing behind Panama's newest political party is a rather 
bitter pill for many Panamenista loyalists to swallow. 
Panamenista chieftains, led by Panamenista primary 
presidential candidate also-ran Alberto Vallarino, rallied to 
push Varla aside and build bridges to Martinelli's camp. 
These Panamenista leaders were driven by awarenes that Varela 
was collapsing in the polls with little prospect of 
recovering, fear of being left on the sidelines should 
Martinelli be elected, and fear not just of a PRD victory, 
but of a victory by the PRD's left wing. Seeing the writing 
on the wall, Varela acquiesced, secured the VP slot for 
himself, and calmed concerns within his party's ranks that 
the Panamenistas might get left entirely out in the cold. 
Advancing under the banner of "walking in the shoes of the 
people so that there is a better Panama for all (caminando en 
los zapatos del pueblo para que llegue un mejor Panama a 
todos)," Martinelli has marshaled and corralled the 
opposition forces in a grand opposition alliance for the 
first time since Guillermo Endara was elected in 1989. 
 
¶4.  (C//NF) Alliance with the Panamenistas has not been 
cost-free for Martinelli though.  Martinelli's independent, 
new-guy-on-the-block, I'm-different image was tarnished by 
the incorporation of Panama's largest and most traditional 
opposition party.  A majority of voters polled indicated that 
by allying with the Panamenistas Martinelli was "breaking a 
promise" not to taint himself with politics as usual.  The 
bandwagoning effect of the grand alliance, however, has 
swamped out concerns about an alliance with what Martinelli 
previously called "old bones (huesos viejos); he is up 
another 9 points in the polls expanding his lead over Herrera 
to 23 points.  The biggest loser in the grand alliance 
formation was UP, the first party to join with CD.  An 
amalgam of two prior parties, the National Liberals (LN) and 
the Solidarity (Solidaridad) parties, UP lacked a viable 
presidential candidate but saw that it could advance its 
desire to become a third force in Panamanian politics by 
allying with Martinelli.  Now UP aspirants for administration 
positions as well as for elected office must compete with the 
Panamenistas' deep bench of experienced players.  In addition 
to losing the VP slot, UP's preferred candidate for Mayor of 
Panama City, the second most important elected office in 
Panama, will have to compete against the PRD's Bobby 
Velasquez and the CD-Panamenista-MORLIRENA candidate Bosco 
Vallarino.  Additionally, UP lost out in its bid to secure 
the FM slot in a Martinelli administration as the MFA and 
Housing ministerial positions went to the Panamenistas in the 
horse trading to close and alliance deal.  Further down the 
ticket, UP National Assembly candidates will go head-to-head 
against better funded and prepared Panamenista candidates (as 
well as MOLIRENA and CD candidates) in uninominal (one 
district, one representative) circuits, though reportedly 
agreements have been reached with respect to Panama's 
plurinominal (one district, multiple representative) circuits 
to ensure that Alliance for Change candidates do not 
undermine one another.  As for MOLIRENA, this greatly 
weakened party will field some strong National Assembly and 
city councilmen candidates, but more importantly will simply 
secure enough votes now in 2009 to avoid political 
extinction.  Going forward, Martinelli will be very reluctant 
to pencil in specific names to any administration jobs for 
fear of further complicating his already difficult alliance 
management challenges. 
 
¶5. (C//NF) By forming a grand opposition alliance -- a feat 
considered unachievable only a few weeks ago given Varela's 
unwillingness to even consider alliance with Martinelli -- 
Martinelli has given additional momentum to the bandwagoning 
and anybody-but-Balbina dynamics that have been working in 
his favor.  Martinelli's alliance building and rapid growth 
in the polls have been achieved not only despite, but largely 
because of his low public profile.  Largely absent from the 
media's eye since before Christmas, Martinelli facilitated 
alliance formation and defused PRD driven accusations that he 
was "crazy" by simply not providing the fora in which his 
often impulsive reactions and bombastic remarks could 
reverberate across Panama's political echo chamber.  Managing 
the growing sense of inevitable victory thatis taking root 
in the opposition's ranks and keeping candidate Martinelli 
and his alliance partners focused on the tasks necessary to 
deliver a win on May 3 will be two of the Alliance for 
Change's most significant strategic challenges. 
 
------------------------------------ 
Balbina: Struggling to Unify the PRD 
------------------------------------ 
 
¶6. (C//NF) Balbina Herrera was carried to victory in the PRD 
primaries on the backs of raw popular support among the 
party's working class, disadvantaged and marginalized 
followers, and left wing ideologues.  She comfortably, but 
not overwhelmingly, defeated Panama City Mayor Juan Carlos 
Navarro who drew support from the PRD's wealthy elite, middle 
class professionals, and moderate leaders.  In November, 
Navarro blasted Torrijos asserting that Torrijos would be 
responsible should the PRD lose the election and issued an 
ultimatum to Herrera that she had until December 1 to make 
him her VP running mate or else she was on her own.  Still 
flabbergasted by Navarro's violation of the PRD's unspoken 
rules to neither speak ill of other PRD members nor wash 
one's dirty linens in public, Panamanian political observers 
were stunned when Herrera dubbed Navarro her VP running mate 
in a move billed as an effort to unify the party.  Party rank 
and file appear to be unconvinced though as from December to 
the present a growing percentage of PRD members reported to 
pollsters that they did not believe that PRD unity had been 
achieved.  While Herrera did seal alliances with the Popular 
(PP) and Liberal (PL) parties -- micro-parties that allied 
with the PRD for the 2004 coalition that brought Torrijos to 
office -- she has struggled to build forward momentum in the 
polls and has languished for the past two months in the low 
thirties. 
 
¶7. (C//NF) Though portrayed by the opposition as a dangerous 
left-wing radical, Herrera is actually running on the basis 
of continuity with the Torrijos Administration's moderate 
policies.  Making the PRD's "Promise of a Government for the 
People" platform (SEPTEL) a centerpiece of her electoral 
strategy, Herrera is basically trying to make the case that 
the PRD has done a lot of good work, but much more needs to 
be done and she -- and her party -- must carry on.  In 
response to Martinelli's efforts to build a populist movement 
for change, Herrera puts forward the argument that the PRD 
has the leaders, the plan, and know-how to continue the 
Torrijos Administration successes.  Navarro's attacking 
Herrera during the primary campaign and even after Herrera's 
primary victory for failure to advocate for a "strong arm 
(mano dura)" response to rising crime and his sharp criticism 
for the Torrijos' handling of the Transmovil public 
transportation bus program for Panama City complicate 
Herrera's and the PRD's efforts to campaign on a record of 
sterling success. 
 
¶8. (C//NF) Navarro's proclivity to attempt to campaign as if 
he were in opposition to the Torrijos Administration 
highlights the byzantine struggle behind the scenes within 
the PRD for control of the party.  That struggle pits PRD 
President Herrera, Secretary General Torrijos, and First 
Sub-Secretary Navarro against one another.  Some PRD insiders 
argue that Navarro would come out ahead in this three-way 
struggle if Herrera lost election after running on Torrijos' 
record. Navarro spares no effort to disparage or seek 
advantage over Torrijos and his ally, PRD newcomer and First 
VP and FM Samuel Lewis (Navarro's first cousin), the very 
people only months ago that Navarro sought to curry political 
favor from.  In short, many PRD cognoscenti believe that 
Herrera is politically speaking sleeping with the enemy, 
Navarro.  Also playing out in the background is a battle for 
the 2014 PRD presidential nomination.  Should Herrera lose, 
Navarro would be the logical candidate.  There are rumblings 
too though that Torrijos is putting in motion an effort to 
amend the constitution to permit former presidents to run for 
president again after a five-year hiatus, shortened from the 
current ten-year period, in 2014.  Ultimately, the 
Navarro-Torrijos-(Lewis) struggle is a battle for control 
over the moderate, centrist faction of the PRD.  An Herrera 
victory would confirm the ascendance of the PRD's left-wing 
"tendency (tendencia)" faction and mark the culmination of a 
shift of the party's center of gravity from the right to left 
completing a trajectory over the past twenty years from the 
right-wing former President Ernesto "El Toro" Perez 
Balladares through the moderate Torrijos and to the left-wing 
Herrera. 
 
¶9.  (C//NF) Herrera's and the PRD's strategy presently is 
focused on unleashing the PRD machine.  Panama's largest 
political party, the PRD has just over 600,000 members 
accounting for about one-quarter of the electorate and has an 
impressive party machinery that is tried and tested on a 
national scale.  Though enjoying a significant presence in 
every social sector in Panama, the core of the PRD's 
electoral strength still rests in its ability to deliver 
lower and working class voters to the ballot box.  Herrera's 
"A Government for the People" message and heartfelt advocacy 
for social justice are aimed at galvanizing and mobilizing 
PRD rank and file.  Putting Navarro on the ticket has so far 
failed to keep the party's wealthy business community 
supporters within the fold.  Of late, Herrera is testing new 
messages that portray herself as the best hope for Panama's 
salt of the earth while painting Martinelli as an 
out-of-touch, wealthy political dilettante.  These tactics 
that smack of class warfare are further straining the PRD's 
ability to keep its big tent coalition together.  In the 
coming weeks, Herrera's biggest challenge will be convincing 
voters that the PRD is unified behind her and straddling the 
social-economic divide between Panama's less advantaged 
working class and its privileged elite. 
 
------------------------- 
A Word about the Vanguard 
------------------------- 
 
¶10.  (C//NF) Only Moral Vanguard of the Nation (VMP) will 
remain outside Martinelli's Alliance for Change.  VMP's 
presidential candidate Guillermo Endara resolutely insists 
that he will remain in the race until the end despite being 
essentially bankrupt, lacking an alliance partner, or 
otherwise having a national presence beyond his name 
recognition.  A life-long Panamenista (Arlfnufista) Party 
member, Endara was the last president of the republic to lead 
a grand opposition alliance.  Though he out-performed 
expectations in 2004 when he pulled in some 300,000 votes, 
Endara struggled to secure the estimated 60,000 signatures 
necessary to establish his personal party.  Though he dipped 
below the margin of error on tracking polls just before 
Christmas, he leapt from two percent to five percent in the 
polls in one week following the formation of Martinelli's 
Alliance for Change, most likely benefiting from die-hard 
Panamenistas who simply could not stomach following 
Martinelli and who preferred to go with the only true 
Panamenista on the ballot.  It is very difficult though to 
foresee a path to victory for Endara. 
 
--------------------------- 
A Word about the Electorate 
--------------------------- 
 
¶11. (C//NF) Panama has roughly 2 million voters, but only a 
bit more than half are registered with any political party. 
About half of all registered voters -- about one quarter of 
the electorate -- are registered with the PRD.  The remaining 
half of registered voters are distributed amongst all other 
parties, though overwhelming with opposition parties. 
Slightly less than half of voters are not affiliated with any 
political party.  As of December 2008, according to the TE's 
statistics, Panama's voter registration statistics indicated 
the following: 
 
Total number of voters:                        1,999,553 
Total number of political party members:       1,296,842 
Total number of unaffiliated voter:              702,711 
 
Herrera Coalition: 
------------------ 
Revolutionary Democratic Party (PRD) members:    663,249 
Popular Party (PP) members:                       35,253 
Liberal Party (PL) members:                       23,581 
 
Martinelli's Alliance for Change: 
--------------------------------- 
Democratic Change CD) members                   131,663 
Panamenista Party members:                       257,769 
Patriotic Union (UP) members:                     91,108 
 
Endara: 
------- 
Moral Vanguard of the Nation (VMP) members        35,217 
 
 
Aside from periodic national referenda, Panamanians only go 
to the polls once every five years to choose representatives 
to fill all the country's elected offices.  As a result, 
voter turn-out is normally above 75 percent participation. 
Ultimately, elections in Panama are decided by the 
independent voter who is not affiliated with any political 
party.  No individual political alliance or force can put its 
candidate into the presidency based on the brute force of its 
members. 
STEPHENSON