Cabinet of Juan Carlos Varela hostage to powerful lobbies

One of the major mistakes of President Juan Carlos Varela has been to form a cabinet that is made up in part by members of his close personal entourage, and in part by political appointees. The latter have been holding on firmly to their posts, in spite of their poor performance and of the repercussions that has had on their respective briefs.

One glaring example of this was that of former security minister Rodolfo Aguilera. Mr. Aguilera, who sailed from Mr. Varela's political circle, held onto his position in spite of widespread criticism of his performance.

Similarly, government minister Milton Henriquez has remained in has position in spite of poor execution and widespread accusations of nepotism.  Mr. Henriquez heads the Popular Party, which sealed an alliance with the president's own Panameñista party in the 2014 elections.

Another example is that of Alcibiades Vasquez, an old guard from the Panameñista party who heads the politically sensitive social development ministry.

It is at the ministry of the presidency, however, that President Varela has placed members of his closest entourage. These include Minister Alvaro Aleman as well as close ministerial adviser Francisco Sierra, whom the president recently appointed member of the ACP board. Mr. Sierra has also served as VP of finance at Banco General, of which Mr. Stanley Motta is a key shareholder.  Mr. Motta was President Varela's principal campaign donor in 2014.

Other members of the close entourage of President Varela are ministerial adviser Temistocles Diaz, as well as former ministerial adviser Ramon Fonseca Mora. Mr. Mora belatedly resigned his position when the disgraced law firm he cofounded, Mossack Fonseca, was involved in a massive international scandal relating to alleged money laundering and tax evasion activities through offshore companies.

According to experts, the fact that more than one minister is seen as serving private interests would be one of the key reasons behind the current cabinet's below-standard performance.

Marcela Paredes De Vasquez at the Education Ministry, Ramon Arosemena at the Public Works ministry, Javier Terrientes at the Health Ministry, as well as the directors of social security and transport authorities, are seen as the main offenders.  

All the while, repeating his mantra that "the ministers that work in my cabinet are committed to working for the whole country", President Varela reiterated that he is content with the results of his cabinet, including that of ministers such as Rodolfo Aguilera who have since resigned.

Such presidential declarations have led many to argue that if the poor performance of the government is not down to unfit ministers, then the president must attribute that responsibility to himself.

It is telling that some ministers have actually recognized the unimpressive delivery of many of their colleagues. One such candid remark came from Carlos Duboy, who declared that "the issue lies with many ministers who are unable to promote their own work".

During a recent visit to the USA, President Varela finally capitulated and announced that he would carry out a one-on-one review of each and every minister upon returning to the country. However, experts speculate that the president's political debts are so onerous that he may have to wait yet another year before carrying out a proper cabinet reshuffle.

Critics are increasingly pointing to the president as the real cause behind the current dysfunctional government.  According to former presidential spokesperson, Luis Eduardo Camacho, "the problem lies with the head of government, not with the ministers as such". Mr. Camacho suggested that "things will only change not through a cabinet reshuffle, but once the president changes his mindset, the very fixation that is leading this country to its doom."

For his part, former presidential candidates for the Partido Revolucionario Democrático (PRD), Juan Carlos Navarro, declared that "what we need is a change of president". Mr. Navarro went on to add that “the government is going adrift” and that its mismanagement “is close to destroying institutions like social security (CSS)”. “Those people should not be occupying positions of power, they are unfit to manage a yearly budget of $4.7bn.

Someone with competence must takeover soon if the boat is not to sink", he warned.