The Republic of Panama, although of only intermittent focus
in the news today, has continuously proved to be central to
debates over international economic policy, constant
political corruption, and pronounced social inequality.
August 15th 2011 marked the 97th birthday of the Panama
Canal, which was a hugely famous engineering achievement at
its inauguration. The birthday, while rarely invoked, serves
as a reminder that the country has yet to achieve a firm and
reputable global standing. In fact, the role of corruption,
perhaps democracy's most dangerous foe, has continuously
proven to be paramount in Panamanian politics. Highlighted
in this edition of 'Spotlight' are two articles that have
been fashioned to illustrate Panama's multi-faceted
relationship with the United States, the industrializing
world, and the Panamanian government's so-called justice
A Legacy of Corruption Marches on: New
Insight into Panama’s Infamous Lucom Case
five years after his death, Wilson Charles Lucom, a
multimillionaire expatriate born in Pennsylvania, still
cannot rest in peace. Lucom’s last testament dictated that
a variety of liquid and physical assets worth upwards of USD
50 million were to be sold, with the proceeds to be
consigned to the Wilson C. Lucom Foundation, a trust
established in order to provide needy children of the tiny
Central American country with food and resources. However,
Lucom’s third wife, Hilda Arias of Panama’s all-powerful
Arias clan, has extensive connections with a number of
political power hitters in the Panamanian establishment.
Using her influence, her agents have claimed the entire
estate for Hilda herself, creating a far different scenario
than the U.S. millionaire ever envisioned.
Richard S. Lehman, a highly regarded Florida tax lawyer and long-time friend of the conservative philanthropist, was appointed by the Panama Probate Court as sole Executor of Lucom’s will. The instructions were explicit and the task was simple: the drawn up bequest, totaling millions of dollars, was to be donated to the foundation and distributed in the form of daily meals to thousands of deserving children. However, it has been just over five years since Lucom’s death, and Lehman continues to face a heartlessly corrupt legal establishment in a no-hold battle against the Arias family’s crusade to nullify the will, install Hilda as sole executor, and quickly siphon off Lucom’s assets.
This analysis was prepared by COHA Research Associate Natalie Simpson.
To read the full article, click here.
The Panama Canal at 97: A Tradition of Innovation and Opposition Continues
In a 2007 speech, U.S. Ambassador William Eaton lauded Panama’s “bright future” and celebrated the 2006 referendum that approved the USD 5.2 billion Panama Canal expansion. Since that moment, the Canal expansion project, the first since the construction of the facility was initially finalized in 1914, has drawn steadfast international support. The United States, which is responsible for an estimated 1/3 of the total 4,800 containers and equipment that pass through the Canal every year, has been especially enthusiastic. However, it is not the only country excited over the expansion for Panama’s now 97-year-old attraction. The Panamanian government, which has been far from stable, has cited the project as instrumental for the continued and future growth of the country’s GDP. By the year 2007, hopes were high amongst Panamanians that the project would add over 50,000 jobs and steadily increase foreign investment by 40 percent until its completion in 2014, the same year as the Canal’s centennial celebration.
A New Canal for an Age of Expanding Trade
The Canal expansion seemed to
reflect a logical investment. The Panama Canal Authority
(PCA), an independent agency in charge of operating and
overseeing the Panama Canal, estimated in 2006 that the
Canal would exceed its capacity between the years 2009 and
2012. This would have led to huge losses for Panamanian
trade, which, without the finalized expansion, continues to
be at a disadvantage compared to other ports that welcome
larger post-Panamax ships. As the cost of maritime export
remains high due to steep oil prices, the solution for many
companies has always been to construct bigger ships able to
carry more cargo, but without the capacity to pass through
the narrow Panama Canal.“Without an expansion,” the PCA
concluded, “the Canal would face new competitors as well
as permanent and irreversible changes in trade patterns in
which Panama would stop being relevant as a global maritime
route”. As more than 14 percent of the Panamanian
government’s annual budget, estimated at USD 3.4 billion,
comes from toll revenue, construction was likely to promote
long-term economic growth. But even though the Canal’s
expansion has so far delivered on its promise of raising the
country’s GDP, worries over high costs, and continued
resentment from some Panamanian environmental and
good-government activists, slows progress with questions
over economic inclusion and environmental
This analysis was prepared by COHA Research Associate Sandra Zuniga Guzman.
To read the full article, click here.
Wednesday, August 17, 2011 | Research Memorandum
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in 1975, is an independent, non-profit, non-partisan,
tax-exempt research and information organization. It has
been described on the Senate floor as being "one of the
nation's most respected bodies of scholars and policy
makers." For more information, please see our web page at www.coha.org