Ousted Honduran President Travels to Panama

01 July 2009

Deposed Honduran President Manuel Zelaya traveled Wednesday to Panama, after he delayed plans to return to his own country, where he faces the threat of arrest.

Mr. Zelaya is to attend the inauguration of incoming Panamanian President Ricardo Martinelli.

Ousted Honduran president Manuel Zelaya speaks during a news conference after a meeting of the OAS in Washington, 01 Jul 2009

The Organization of American States early Wednesday threatened to suspend Honduras from the regional grouping if the coup leaders do not restore Mr. Zelaya to power within three days.

Mr. Zelaya was planning to return to Honduras Thursday, but postponed the trip to coincide with the OAS deadline.

Authorities in the interim Honduran government, led by Roberto Micheletti, have vowed to arrest Mr. Zelaya.

Soldiers forcibly expelled Mr. Zelaya from Honduras Sunday, the day he had planned to hold a referendum on reforming the country's constitution. Critics said he wanted to alter the constitution so he could run for another term - a charge he denies.

Mr. Zelaya says when he returns to Honduras, he will be accompanied by the presidents of Argentina and Ecuador, as well as the heads of the OAS and the U.N. General Assembly.

The interim government's attorney general, Luis Alberto Rubi, says Mr. Zelaya is accused of 18 offenses, including treason and abuse of power. Foreign Minister Enrique Ortez told CNN en Espanol that he would also be charged with drug trafficking.

In an address to the U.N. General Assembly Tuesday, Mr. Zelaya called his ouster undemocratic and illegal. He said he intends to finish his term, which ends next January.

There have been protests this week in the Honduran capital Tegucigalpa both for and against the coup. The city is under a night-time curfew.

The United States has joined other countries and the United Nations in condemning the coup, and calling for the Honduran president to be restored to power.

Spain announced it is withdrawing its ambassador from the Central American country in protest, adding to a list of countries that have recalled their envoys. Also, the United States announced it is suspending joint military activities with Honduras.

Interim President Roberto Micheletti, appointed to the post by parliament, says the only way Mr. Zelaya will return to power is by force.

Some information for this report was provided by AFP, AP and Reuters.

Pro-business president takes office in Panama

PANAMA CITY (AP) — Businessman Ricardo Martinelli was sworn in as Panama's new president on Wednesday, promising to start the biggest job-creation push ever in the country.

Martinelli said he wants to make the nation of 3.3 million inhabitants the best place to do business in Latin America.

"The people have given us a clear mandate to bring change to the government, from top to bottom, and that is what we will do," Martinelli said at the ceremony attended by various foreign leaders, including Honduras' ousted president, Manuel Zelaya.

Martinelli, 57, a conservative supermarket magnate, also expressed a desire to become "an active partner" with Colombia and Mexico in the fight against drug trafficking during his five-year term.

One of the new government's proposals is a billion-dollar plan to build a train system for the capital's metropolitan area.

Martinelli's predecessor, Martin Torrijos, launched a $5.25 billion project to increase the Panama Canal's capacity and allow it to accommodate larger ships.

The canal is Panama's economic motor and Martinelli supported its expansion, but the world's economic woes have generated uncertainty over the project, which is receiving $2.3 billion in international financing.

And the country's real-estate boom, another driving force of the economy, has also been affected by the international financial crisis and economic downturn.

Martinelli acknowledged "our administration will not have the resources the previous administration had."

Latin American Construction Might Be Down, But It's Not Out

Note: Latin American Construction Might Be Down, But It's Not Out," at 2:17 GMT June 29 and repeated at 11:36 GMT June 30, misstated the market to which Levy-Yeyati was referring, in the 13th paragraph. Levy-Yeyati intended to refer to Panama, not Brazil. The correct version follows:

By Joan R. Magee
Of DOW JONES NEWSWIRES

NEW YORK (Dow Jones)--Not too long ago, real-estate development in Latin America was hot, foreign money was flowing in, and local companies were going public as the construction industry boomed.

The global credit crisis put the brakes on that euphoria, as seen in plummeting commercial and residential expansion, though not all countries in the region have been hit the same way.

One barometer of construction and development is cement output, which is set to decrease 4.1% this year in South America from the previous year. It will fall another 1.4% in 2010, according to a Portland Cement Association report released earlier this month.

The association predicted a 1.7% global decrease in cement consumption for 2009, with growth in China and India masking declines in both developed and developing markets.

Mexico, close to the U.S. both geographically and economically, is one of the worst-hit in the aftermath of the U.S. housing implosion. The country's growth decelerated to 1.3% in 2008 from 3.2% in 2007, and the economy is expected to contract by close to 6% this year.

Mexican Finance Minister Agustin Carstens recently said demand for housing this year will likely fall 7.1% from 2008, even though available financing will be up 2.5%.

The government's National Infrastructure Program calls for public and private investment of around $40 billion a year between 2007 and 2012. And while private investment is down sharply in the current recession, public investment has filled some of the gap, thanks to counter-cyclical government spending.

Public support for infrastructure has been such that shareholders of construction firm Empresas ICA (ICA) have approved a plan to sell up to $350 million in shares to finance infrastructure projects that are already under way or ones the company plans to bid on. And Desarrolladora Homex (HXM), one of the largest Mexican home-building companies, said it expects 8% to 10% revenue growth this year.

Panama, once hyped as a hot destination for U.S. and European retirees looking for second residences, has faltered. Overall construction activity plunged 25% to $97 million in April from $130 million in April 2008, government officials said.

The slowdown follows several years of solid economic growth, buoyed in large part by the Panama Canal widening project. Fast development had even led to concerns about overbuilding among some Panamanian policy makers.

Latin America's largest economy, Brazil, has taken measures to counter a first-quarter drop in construction, which fell 9.8% in year-on-year in the first quarter.

The government recently approved $15.2 billion for low-income housing over the next 15 years, which bodes well for an uptick in growth.

"Most other markets were buttressed not by mortgage credit, but by the incomes of the middle-upper class," said Eduardo Levy-Yeyati, a director and head of emerging markets strategy at Barclays Capital.

The Brazilian economy shrank for a second straight quarter in the first quarter of this year, although the government still has hopes for modest growth in all of 2009, following 5.1% expansion in 2008.

And the 2014 World Cup soccer tournament, though somewhat in the distance, will span 12 cities in Brazil and spur more development.

Brazil's government is already pouring money into World Cup infrastructure, from new hotels to stadiums, in preparation for the waves of tourists to come.

"Construction will weaken as in a typical recession, but will not tank as in the U.S., the U.K. or Spain," Barclays' Levy-Yeyati said.

Indeed, Portland Cement Association predicts cement output in South America will rise 6.9% from 2010 by 2011, auguring a turnaround in the near future.

-By Joan R. Magee, Dow Jones Newswires; 212-416-2672; joan.magee@dowjones.com.

Americans visiting Panama: Don’t forget your VISA!

Americans visiting Panama: Don’t forget your VISA!

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Cheapest Places for Americans to Live Abroad

When considering the cheapest places to live abroad it is insufficient to just look at cost of living indexes - real estate, taxation, health care, accessibility, are a few other considerations to be keep in mind.

This article has been written to answer a question asked by many Americans reaching retirement as well as younger people seeking to escape the rat race. It seems that there are many US citizens seeking an affordable overseas destination in which to live and work or retire and there are many options available to them.

Countries such as Mexico, Panama and Belize are well known as lower cost locations for US citizens seeking an affordable overseas location. All have very low costs of living, low real estate costs and low or no taxation. Naturally enough all of these factors make the destinations favourites of ours too! But when it comes to younger Americans in search of a cheaper country in which to live many struggle to find decent employment or education for their children in Mexico, Panama or Belize. One option for some might be teaching jobs overseas for Americans but this is not a option for some unless they have a degree.

Healthcare is a major concern for retiree Americans abroad whether they remain at home or move abroad; those who have been signed up to a particular health insurance provider for many years may find that they are able to maintain payments into retirement and even extend cover to the overseas country in which they choose to live as well. Alternatively, once an individual becomes non-resident in the US they will find that their expat health insurance costs usually fall dramatically and sometimes healthcare is actually free – so affording healthcare abroad needed be restrictively expensive – one just has to do a certain amount of research into which providers cover which countries and how much one will have to pay for the necessary level of health cover.

Americans of working age who are looking for overseas jobs and a good country in which to live and work don’t necessarily need to look too far from home. A growing number of US citizens are choosing to move north to Canada where real estate can be cheaper, taxation can be lower, healthcare is far cheaper and the standard of living as high as in America. Canada has welcomed a new generation of Americans who generate their income via the internet and who can effectively live anywhere in the world for example.

For those simply looking to reduce their taxation burden tax free countries like Dubai, Saudi Arabia and Qatar may appeal – although the US IRS like to keep tabs on all their citizens’ earnings no matter where in the world they live!

Eastern Europe is emerging as a destination of choice for some of the more pioneering Americans who want affordable real estate, a low cost and nice standard of living. Countries like Poland, the Czech Republic, Latvia, Croatia and Romania all have emerging economies and real estate markets and are working hard to attract foreign investment – whether direct investment or in the form of welcoming expatriates to live and even work among them.

In conclusion, the cheapest places to consider for Americans living abroad are plentiful in number and an individual’s choice will ultimately be dictated by many personal factors. The internet is probably the best place to begin a search for new horizons and anyone thinking about moving abroad should write their own ‘destination must have’ checklist to enable them to find the best countries available that fulfil all criteria and meet all objectives. Amazon have a whole range of books dedicated to retiring abroad as well and those who don’t want to buy the books online can at least read about the titles before ordering them from the library!

Panama's ruling party picks woman for President

Panama's ruling party has chosen a female former Cabinet minister as its presidential candidate for elections in May, party officials said Monday.

If Balbina Herrera wins, she would be the country's second female president, following Mireya Moscoso, widow of former President Arnulfo Arias, who was elected in 1999.

Herrera, a 53-year-old former housing minister under current President Martin Torrijos, defeated Panama City Mayor Juan Carlos Navarro in the Democratic Revolutionary Party primary held Sunday.

While full results won't be ready for several days, party official Carlos Gonzalez said Monday that Herrera won with a 10 percent lead over Navarro. She will officially be named the candidate later this week at a party event in the capital.

Herrera promises to continue Panama's strong economic growth, with more professional and working-class jobs.

Early polls show Herrera running a close race with Ricardo Martinelli, who owns a chain of supermarkets. Martinelli, who founded the Democratic Change Party, is making his second run for the presidency.

Since a U.S. invasion ended Manuel Noriega's military dictatorship in 1989, only Herrrera's party and the Panamanian Party have won the presidency.

But the Panamanian Party candidate, Juan Carlos Varela, is running a distant third in recent polls. The 45-year-old comes from a family that produces Panama's most popular rums.

Torrijos, who earned an economics degree at Texas A&M University, was elected in 2004. He is the son of former strongman Omar Torrijos, who died in a 1981 plane crash.

Under Panama's law, presidents can only serve one term.

More Good Reasons to Escape to Panama

The Daily Reckoning PRESENTS: The feeble American response to Russia’s assertion of power in the Caucasus of Central Asia was appropriate, since, according to James Howard Kunstler, the United States’ claims of influence in that part of the world are laughable. Read on...

REALITY BITES AGAIN by James Howard Kunstler
The U.S. had taken advantage of temporary confusion in Russia, during the ten-year-long post-Soviet-collapse interval, and set up a client government in Georgia, complete with military advisors, sales of weapons, and even the promise of club membership in the Western alliance known as NATO. These blandishments were all in the service of the Baku-to-Ceyhan oil pipeline, which was designed specifically to drain the oil region around the Caspian Basin with an outlet on the Mediterranean, avoiding unfriendly nations all along the way.
At the time this gambit was first set up, in the early 1990s, there was some notion (or wish, really) among the so-called western powers that the Caspian would provide an end-run around OPEC and the Arabs, as well as the Persians, and deliver all the oil that the US and Europe would ever need – a foolish wish and a dumb gambit, as things have turned out.

For one thing, the latterly explorations of this very old oil region – first opened to drilling in the 19th century – proved somewhat disappointing. U.S. officials had been touting it as like unto “another Saudi Arabia” but the oil actually produced from the new drilling areas of Kazakhstan, Turkmenistan, and the other Stans turned out to be preponderantly heavy-and-sour crudes, in smaller quantities than previously dreamed-of, and harder to transport across the extremely challenging terrain to even get to the pipeline head in Baku.
Meanwhile, Russia got its house in order under the non-senile, non-alcoholic Vladimir Putin, and woke up along about 2007 to find itself the leading oil and natural gas producer in the world. Among the various consequences of this was Russia’s reemergence as a new kind of world power – an energy resource power, with the energy destiny of Europe pretty much in its hands. Also, meanwhile, the USA had set up other client states in the ring of former Soviet republics along Russia’s southern underbelly, complete with U.S. military bases, while fighting active engagements in Iraq and Afghanistan. Now, if this wasn’t the dumbest, vainest move in modern geopolitical history!

It’s one thing that U.S. foreign policy wonks imagined that Russia would remain in a coma forever, but the idea that we could encircle Russia strategically with defensible bases in landlocked mountainous countries halfway around the world...? You have to ask what were they smoking over at the Pentagon and the CIA and the NSC?
So, this asinine policy has now come to grief. Not only does Russia stand to gain control over the Baku-to-Ceyhan pipeline, but we now have every indication that they will bring the states on its southern flank back into an active sphere of influence, and there is really not a damn thing that the U.S. can pretend to do about it.

We could have spent the past ten years getting our own house in order – waking up to the obsolescence of our suburban life-style, scaling back on the Happy Motoring, reconnecting our cities with world-class passenger rail, creating wealth by producing things of value (instead of resorting to financial racketeering), protecting our borders, and taking the necessary measures to defend and update our own industries. Instead, we pissed our time and resources away. Nations do make tragic errors of the collective will. The cluelessness of George Bush is nothing less than a perfect metaphor for the failure of a whole generation. The Boomers will be identified as the generation that wrecked America.

So, as the vacation season winds down, this country greets a new reality. We miscalculated in Western and Central Asia. Russia still “owns” that part of the world. Are we going to extend our current land wars there into the even more distant and landlocked Stan-nations? At some point, as we face financial and military exhaustion, we have to ask ourselves if we can even successfully evacuate our personnel from the far-flung bases in Uzbekistan and Kyrgyzstan.

This must be an equally sobering moment for Europe, and an additional reason for the recent plunge in the relative value of the Euro, for Europe is now at the mercy of Russia in terms of staying warm in the winter, running their kitchen stoves, and keeping the lights on. Russia also exerts substantial financial leverage over the U.S. in all the dollars and securitized U.S. debt paper it holds. In effect, Russia can shake the U.S. banking system at will now by threatening to dump its dollar holdings.

The American banking system may not need a shove from Russia to fall on its face. It’s effectively dead now, just lurching around zombie-like from one loan “window” to the next pretending to “borrow” capital – while handing over shreds of its moldy clothing as “collateral” to the Federal Reserve. The entire US, beyond the banks, is becoming a land of the walking dead. Business is dying, home-ownership has become a death dance, whole regions are turning into wastelands of “for sale” signs, empty parking lots, vacant buildings, and dashed hopes. And all this beats a path directly to a failure of collective national imagination. We really don’t know what’s going on.

The fantasy that we can sustain our influence nine thousand miles away, when we can’t even get our act together in Ohio is just a dark joke. One might state categorically that it would be a salubrious thing for America to knock off all its vaunted “dreaming” and just wake up.

Until next time,
James Howard Kunstler
for The Daily Reckoning

George Carlin Dead

Totally off topic and nothing to do with this blog but I need to pause and honour one of my all-time favorite entertainers and comedians, George Carlin who died yesterday of Heart failure as reported in Los Angeles (AFP)

George Carlin had been in show business for 50 years. He made 22 albums and won four Grammy Awards. He died at age 71.

As a teenager I can remember listening with my big brother to his album AM/FM and later becoming all too familiar with his now infamous "Seven Words You Can Never Say On TV" routine. Some of the news articles today say that is what he will be most remembered for. I really hope it is the biting anti-establishment brand of humour he refined that people will remember.

An icon for free speech and using your brain I take this moment to pause and give thanks to George Carlin for reminding us all that common sense and humour can change the world if we just slow down long enough to think.