Tour con ministro de asuntos exteriores

C O N F I D E N T I A L SECTION 01 OF 03 PANAMA 002392



SIPDIS



DEPARTMENT FOR WHA/CEN, WHA/CCA, WHA/AND

SOUTHCOM ALSO FOR POLAD



E.O. 12958: DECL: 12/09/2015

TAGS: PREL, PGOV, ETRD, PM, POL CHIEF

SUBJECT: TOUR D'HORIZON WITH PANAMANIAN FOREIGN MINISTER





Classified By: Ambassador William A. Eaton for reasons 1.4 (b) and (d)



1. (C) SUMMARY: Over a 3-hour private dinner December 5 at

the Residence, Ambassador held a wide-ranging discussion with

Panamanian Foreign Minister (FM) Samuel Lewis Navarro on

subjects including U.S. concerns about the integrity of the

Panamanian judicial system (including the recent revocation

of the U.S. visa of Supreme Court Magistrate Winston

Spadafora); the urgency (and perhaps last chance) of

concluding a free-trade agreement at the January 10-12

meetings in Washington; troubling recent developments that

could hamper Panama's investment climate; President Torrijos'

recent trip to Cuba; and upcoming UN issues that we hope

Panama will support. END SUMMARY.



Concerns about Panamanian Judiciary

--------------------------------------------- -

2. (C) FM Lewis expressed to Ambassador Eaton December 5

President Torrijos' concern that the growing public uproar

about corruption in the Supreme Court -- exacerbated by the

recent revocation of Supreme Court Magistrate Winston

Spadafora's U.S. visa -- could lead to a constitutional

crisis, pitting the Executive and Legislative Branches of

government against the Judiciary. Wringing his hands, Lewis

repeatedly emphasized that the Executive has no role in

prosecuting Spadafora and others since the Constitution

reserves that role for the Legislative Branch, which had

decided to do nothing. Lewis self-consciously brushed aside

Ambassador's rejoinder that the Legislative Branch remains

under control of the PRD, Torrijos' party. Lewis added that

Torrijos plans to name two new well-respected magistrates

shortly to fill upcoming vacancies. Torrijos had declined to

involve civil-society groups in the magistrate selection

process as recommended by the Comision de Estado Pro Justicia

that he appointed last spring, saying that the selection

process is the prerogative of the Executive Branch. Lewis

said Torrijos is working with incoming Supreme Court Chief

Justice Graciela Dixon to pressure at least two more

resignations from the court, thereby changing the balance of

power on the court. (Comment: Lewis did not name names.

Also, Lewis's quip about changing the "balance of power" on

the Court is ambiguous. End Comment.)



3. (C) Ambassador Eaton told Lewis that even though the

Embassy does not plan to make further public statements about

Spadafora's visa, we would continue to speak out about the

corrosive effect corruption and a discredited judiciary have

on democracy and Panama's investment climate. The Ambassador

then gave Lewis a heads-up about a brewing controversy

involving a U.S. company (Panama Canal Railroad) that had won

an international arbitration panel,s favorable ruling in a

$1.3 million dispute with an Israeli communications firm over

fiber-optic lines. The Panamanian Supreme Court must

validate the enforceability of the decision in Panama before

the company can actually be paid. However, we have heard

that one of the magistrates on the Court's 3-judge panel had

pocketed a draft decision in favor of the award for 3 months

already, awaiting a change in court membership that might

shift the balance and overturn the decision. Panama Canal

Railroad alleges that this magistrate had accepted a $90,000

bribe to solidify his support against the U.S. company.

Ambassador warned that such behavior, if verified, would

generate vigorous and vocal protests from the embassy, as

well as prominent mention in the annual investment climate

report we will issue in January. Ambassador urged Lewis to

use whatever influence he had to avoid an incident in which

Panama was seen as undermining international arbitration

decisions. An uncomfortable, agitated and angry Lewis

gritted his teeth and said, almost to himself, "We've got so

many bright opportunities for our country on the horizon and

our own damned citizens are screwing it up." (Note:

Ambassador received word two days later that the arbitration

action had suddenly and miraculously emerged from the Supreme

Court. During Ambassador's call of thanks to Lewis December

7, Lewis mentioned that he had immediately raised this issue

with Torrijos, who had then launched into action. Clearly,

Torrijos has influence over the court, despite his

protestations to the contrary.)



Free Trade Agreement

---------------------------

4. (C) Ambassador reiterated his urging to Lewis pull out

all the stops to conclude a free trade agreement during the

January 10-12 meetings in Washington. Lewis assured

Ambassador that Panama was fully prepared to finalize the

agreement; he hoped, however, that the U.S. shared that

commitment. Lewis complained that he perceived a diminished

resolve in USTR to conclude a free trade agreement with

Panama, even despite intense supportive lobbying by

Panamanian officials on the Hill. Ambassador responded that

the U.S. still wants a free-trade agreement with Panama.

However, he said, protracted negotiations with Panama

inevitably cause some to weigh the respective advantages of

continuing to use scarce USTR resources on a bilateral free

trade agreement with a relatively small market like Panama or

begin to shift those resources to other, larger markets via

multilateral free-trade agreements.



Torrijos Trip to Cuba

-------------------------

5. (C) Ambassador expressed disappointment with President

Torrijos' recent trip to Cuba with a private group to seek

eye operations for Panamanians. This appearance of a cozying

relationship with Castro made it more difficult to enlist

support from, for example, the Florida delegation on the Hill

for a bilateral free-trade agreement. Ambassador added that

these concerns had been raised with him by senior-level USG

officials during the recent WHA Chiefs of Mission Conference

in Washington. Lewis pshawed, saying he had personally

culled Florida newspapers and had seen nary a comment about

the Torrijos trip.



UN Issues

------------

6. (C) Ambassador pointed out that there were a number of

important issues on the table at the United Nations and that

the U.S. hoped we could count on Panama's support for these

issues which are of mutual interest. Those issues include

support for management reform initiatives, such as creation

of an independent inspector general and a thorough review of

mandated programs; solidarity with the U.S. on social issues

of common interest and concern; and support for efforts to

promote democracy and human rights. Lewis agreed that those

issues are also of interest to Panama, but offered no

specific pledges of support.



Comment

-----------

7. (C) The specter of a "constitutional crisis" that Lewis

and Torrijos fear has been years in the making. Each of the

three branches of government finds itself unable to take

action against corruption but that is not because of some

Catch 22 or accident. Essentially Panama has a judicial

system, corrupt and dysfunctional though it may be, that

works well for the people in power, protecting members of the

so-called "political class." Until it becomes possible to

prosecute wrongdoers for corruption in Panama -- that is,

until the people in power admit that they, their family or

their friends may be prosecuted for crimes that they commit

-- the threat of such a crisis is very real.



8. (C) On the Cuba visit, Torrijos's main reason for going

probably was nervousness about protecting his left flank,

buttering up Castro to keep Chavez at bay. If that was the

motive, it seems to have worked splendidly. Castro

apparently quipped that Torrijos reminded him of his father,

dictator Omar Torrijos, a very high compliment. The star of

the deceased Omar Torrijos still is high in Latin America's

leftist firmament, as he is credited with being the

nationalist and patriot who drove the gringos from the Canal

Zone. Whether Torrijos actually needs protection from Chavez

is less certain. GOP officials are nervous about Chavez,

although the Venezuelan President has little influence in

Panama or standing among Panamanians.



9. (C) Despite some difficult topics discussed during the

dinner, Lewis appeared in good spirits, buoyed by nearly a

month on the road. He had been impressed by his trip to

India and talked extensively about India's model of

service-oriented foreign trade while focusing its industrial

sector on the internal market. He also expressed admiration

for the seriousness and focus of the leaders at the APEC

Summit, contrasting it with the fractiousness and

parochialism at the Summit of the Americas in Mar del Plata.

"That's why we're pursuing membership in APEC," he said.

"They understand free trade."

EATON