PANAMA. Republic of Panama
A country on the Panama Isthmus in Central America. Area - 77.1 thousand km². Capital - Panama City (over 1 million). Administrative-territorial division - 9 provinces. Population - 2.8 million (2004), predominantly Spanish-Indian mestizos; the country is also home to blacks, mulattos, and several tens of thousands of indigenous people. The official language is Spanish. The dominant religion is Catholicism. The currency unit is the balboa (=100 centesimos) and the US dollar (equivalent).
It has diplomatic relations with the Russian Federation (established with the USSR on March 29, 1991).
National holiday - November 3 - Independence Day (1903).
Panama is a presidential republic. The constitution of 1972 is in effect with several amendments. The head of state and government is the president, elected by popular vote for a term of 5 years; since September 1, 2004, it is M. Torrijos Espino. The highest legislative body is the unicameral Legislative Assembly, whose 78 deputies are elected by universal, direct, and secret ballot for a term of 5 years under a proportional representation system (the current composition of the assembly was formed based on the elections of May 2, 2004). According to the constitution, the armed forces have been abolished in Panama.
Political parties: the "Renewed Fatherland" bloc - the ruling party, includes the Revolutionary Democratic Party (founded in 1978 by General O. Torrijos) in coalition with the People's Party. The leading opposition bloc includes the Arnulfista Party (founded in 1990) and the National Republican Liberal Movement (MOLIRENA, founded in 1981). Other active parties include the Solidarity Party (founded in 1993), the National Liberal Party, and the Christian Democratic Party.
Trade unions: The Confederation of Workers of the Republic of Panama - founded in 1950, is a member of the WFTU and the ITUC, the National Council of Workers of Panama - established in 1971, the Workers' Center of the Panama Isthmus - founded in 1971, the National Confederation of Independent Trade Union Unity.
Spanish conquistadors appeared in this area in 1501. During the war of the Spanish colonies in America for independence in 1821, Panama freed itself from Spanish rule and became part of Gran Colombia. In 1879, French entrepreneur F. Lesseps obtained a concession from the Colombian government to build an interoceanic canal in the Panama department. In 1894, the French company sold its concession to the USA. On November 3, 1903, Panama separated from Colombia and declared its independence. On November 18, 1903, a treaty was signed under which Panama ceded part of its territory to the USA for indefinite use for the construction and operation of the interoceanic canal. On June 12, 1920, the canal was officially opened (connecting the Pacific and Atlantic Oceans, it runs through the Panama Isthmus, with a length of 81.6 km).
During World War II, the USA established military bases in Panama.
After mass public protests and the shooting of a peaceful demonstration of Panamanians at the canal zone border in January 1964, the USA was forced to negotiate a review of the status of the canal zone.
In 1968, as a result of a coup, a left-radical military-civilian government led by O. Torrijos came to power. On September 7, 1977, the USA and Panama signed the Panama Canal Treaty (PCT), which provided for the gradual transfer of the canal to Panamanian jurisdiction and the elimination of American military bases by 2000, as well as a treaty on permanent neutrality and operation of the canal, which replaced the 1903 treaty. Since January 1, 2000, Panama has restored full sovereignty over the PCT.
After the death of O. Torrijos in 1981, successive governments of the country declared their determination to continue the course of strengthening national sovereignty. On December 20, 1989, as a result of armed intervention by the USA, the government of General M. Noriega was overthrown, and the commander of the national defense forces was arrested (charged with corruption and ties to drug trafficking) and taken to Miami, where he was sentenced to a long prison term. President G. Endara was sworn in. His government managed to stabilize the domestic political situation and restore the democratic image of the country on the international stage. The National Defense Forces were dissolved. Under the policy of "open doors," there was a revival of business activity and an influx of foreign capital.
In the general elections held on May 8, 1994, the candidate from the Revolutionary Democratic Party (RDP), E. Pérez Balladares, won. In the general elections held on May 2, 1999, the candidate from the Arnulfista Party, M. Moscoso, won, continuing the course of further liberalization of the economy.
Panama is a member of the UN (since 1945), OAS (since 1948), WTO, Rio Group, CAIS, and other international and regional organizations.
Panama is one of the largest financial, trade, and transport centers in Latin America, having a reputation as a "country of services and trade," as about 70% of its economic activity is accounted for by foreign trade and services.
The Panama Canal plays a significant role in the country's economy, through which up to 14,000 vessels pass annually. In 2004, revenues from the canal's activities exceeded 1 billion dollars. The main users of the canal are the USA, China, Japan, Ecuador, Chile, and EU countries.
Panama is also a "flag of convenience" country. It ranks first in the world in terms of the number of registered vessels.
The Colón Free Zone (CFZ) operates - the second largest in the world (after Hong Kong) in terms of significance and volume of export-import operations. More than 1,200 companies are registered here. In 2004, the total volume of trade operations amounted to about 10 billion dollars. The level of investment in the CFZ increased to 2 billion dollars. The main share of trade turnover consists of consumer goods, clothing, footwear, as well as household electronic equipment, computers, cars, etc.
A large International Banking Center operates in Panama, which includes about 80 banks. Their total assets amounted to approximately 36 billion dollars by the end of 2004.
In recent years, the significance of foreign tourism in the country's economy has been rapidly growing.
In the country's economy, American capital traditionally predominates. In recent years, the influence of countries in the Asia-Pacific region and Latin America has been increasing. The main trading partners of Panama are the USA, China, Taiwan, Japan, South Korea, Colombia, and Venezuela.
Traditionally, Panama's foreign trade balance (excluding the CFZ) is characterized by a negative balance. In 2004, imports amounted to 3 billion dollars, while exports were 884 million dollars. Panama's exports are dominated by seafood, bananas, raw sugar, coffee, as well as fresh fruits and vegetables, juices, tobacco, and meat. Imports consist of industrial goods, agricultural fertilizers, petroleum products, communication equipment, food products, machinery, and equipment.
About 10% of the active population is engaged in agriculture. Bananas, citrus fruits, sugarcane, coffee, and tobacco are grown.
Panama's external debt is 6.5 billion dollars, and the total public debt exceeds 10 billion dollars. Debt service payments accounted for 25% of all budget expenditures in 2004. The budget deficit in 2004 exceeded 700 million dollars.
The unemployment rate in 2004 was 12.6%. According to UNDP data, 40.5% of the country's residents live below the poverty line.
There are 2 universities in Panama. Several daily newspapers are published, including "Prensa" (38,000 copies), "Crítica Libre" (40,000), and "Siglo" (42,000). Approximately 120 radio stations and more than 10 television stations operate. Broadcasting and television are privately owned and operate on a commercial basis. There is an Association of Panamanian Broadcasting.