The arrival of the Martinelli administration in Panama marks an opportune moment for the Obama administration to celebrate the Central American nation’s maturing democracy by strengthening bilateral relations. Panama has historically acted as a gateway for U.S. involvement and investment in the hemisphere, and the United States should find areas for new and increased cooperation, particularly in terms of confronting regional security challenges posed by the presence of powerful drug-trafficking organizations in the Americas.
Ricardo Martinelli was sworn into office on July 1 as the new president of Panama after defeating the ruling party’s candidate, former Housing Minister Balbina Herrera, in elections held on May 3. Martinelli is an ideologically conservative candidate who won with nearly 60 percent of the popular vote. And he assumes the presidency at a time when Panama faces a set of governing challenges representative of those throughout Central America: rising public insecurity, rampant corruption and government unaccountability, and weakened economic growth due to slowed investment as a result of the global economic crisis.
Martinelli’s victory over the left-leaning Herrera runs counter to the surge of left-leaning presidents that have won elections throughout Latin America. The peaceful transfer of power between opposing political parties in Panama occurred just days after Honduran President Manuel Zelaya was ousted in a coup, highlighting the relative strength of Panamanian democracy 20 years after the end of former military dictator Manuel Noriega’s rule.
The United States transferred full authority of the Panama Canal to the Panamanian government in 1999, and until then maintained a military presence in Panama that included, at its peak, 14 military bases, 100 defense sites, and as many as 67,000 troops stationed in the Panama Canal Zone. Current U.S. interests in Panama are primarily economic. U.S. foreign direct investment in Panama stands at approximately $6 billion, and two-way trade amounted to almost $5 billion in 2008.
Panamanian affiliates of U.S. companies invested in Panama employed nearly 18,000 people as of 2006, which contributed more than 4 percent of Panama’s gross domestic product. What’s more, approximately 25,000 American citizens currently reside in Panama, and there is an increasing presence of American retirees living in Panama’s western provinces.
The history of the U.S.-Panama relationship is complex and profound, but it currently lacks a robust partnership in confronting regional security challenges. Chief among the Obama administration’s priorities for forging an enhanced relationship with Panama should be to develop a regional response to the security challenge created by the presence of extremely powerful and violent drug-trafficking organizations throughout the Americas. This means that the Obama administration must pay more attention to the Central American nations that together create the conduit for drugs grown in the Andean region and shipped to Mexico for entry into the United States.
The United States has currently allocated $20.9 million in aid to Panama for fiscal year 2009, $8.9 million of which is being provided under the Mérida Initiative―a $1.4 billion, multi-year counter-narcotics initiative aimed mostly at combating the increasingly devastating effects of drug-trafficking organizations in Mexico. Yet the $100 million that the United States has promised to seven other countries in Central America and the Caribbean, of which Panama gets only $8.9 million, is simply not enough compared to the $700 million dollars it gave to Mexico for fiscal year 2009 under the Mérida Initiative.
Panama is the first stop for drugs leaving the Andean region on their way to Mexico and eventually the United States. Accounts of rising public insecurity related to drug-trafficking operations and criminality more widely in Panama have circulated in the national press for the past few years. Former Panamanian president Martín Torrijos announced measures in 2008 to increase the number of police patrolling the streets and search for ways to regulate ownership of firearms and explosives. In polling done before the May 3 presidential elections, Panamanians expressed that rising public insecurity was among their top three concerns.
President Martinelli has, as one of his first actions since assuming the presidency, imposed a nationwide curfew for minors and increased police salaries to help bring rising public insecurity under control. The Martinelli administration made clear during its first three weeks in office its intentions to increase counter-narcotics and security cooperation programs with Colombia and Mexico. The United States should capitalize on the Martinelli administrations’ initiative and resolve to enhance its bilateral and regional security programs either by increasing funds for Central America’s portion of the Mérida Initiative or creating a separate but complementary counter-narcotics program for Central America.
Increased U.S. funding should be aimed at providing material equipment and support for Panama, but it should also emphasize support and training for the country’s relatively weak civil institutions in order to help build public confidence in the rule of law. Current U.S. support for community policing programs in Panama is a start, but more can be done to help Panama strengthen its judicial system so that it is more effective, more transparent, and less corrupt. Recruiting U.S. civil society actors, such as the American Bar Association and other legal institutions, should be a part of that effort.
Doing so will make the United States’ current counter-narcotics strategy in the Americas more effective. The Obama administration needs to match its counter-narcotics and security strategy in Mexico and the Andean region with increased support for the Central American countries that are suffering the destabilizing effects of being a key transit route for drugs destined for the United States.
The Obama administration should capitalize on the opportunity that the Martinelli administration brings for enhancing counternarcotics efforts. Cooperation on these issues will strengthen the U.S.-Panama bilateral relationship, and it will also be an important step to making the broader U.S. security strategy in the Americas more comprehensive and effective.
Stephanie Miller is currently a consultant on U.S.-Latin America relations and was formerly a Research Associate for the Americas Project at the Center.