Panama: Fuel Price Negotiations Achieve Results

Map of Panama which borders Colombia to the East and Costa Rica to the West.

The dialogue had already reached consensus on the issue of dropping the price of basic food products by 30%, without affecting the national producers.

By Telemetero

HAVANA TIMES – The dialogue in Panama closed Wednesday the negotiation related to the fuel issue, achieving eight points of consensus and five points of discord. Gasoline prices will be $3.25, down from $5.25 before the protests began.

The following consensus was reached:

    -Include all types of machinery except yachts, luxury boats, as well as government vehicles.

    -Establish a commission to verify the management of fuel tank storage levels at service stations that guarantees a fair price for the consumer.

    -The subsidized fuel price measure must be applied at the national level.

    -Compliance with the subsidized fuel price measure will be supervised by Acodeco, the Consumer Protection Agency

    -If the price of fuel rises internationally, the price of $3.25 will be maintained in Panama.

    -As a long-term measure, the Government must establish the sustainable energy policy.

    -Establish a sub commission to verify and establish mechanisms for situations that do not allow the effective use of the fuel subsidy.

    -Fishermen and farmer’s agricultural machinery will be included in the benefit only with the presentation of their identity cards.

The discussion

The citizen’s groups presented a new proposal regarding the price of a gallon of fuel in US $3.00. for all motor vehicles and machinery nationwide. The Executive rejected this proposal, mentioning that the current price of a gallon of fuel $3.25 was the result of several negotiations. The price had been over $5.20 before the nationwide protests began.

Faced with this, the united protest movement presented a new counterproposal to maintain the price for 95-octane gasoline at $3.25; establish $3.18 for 91 octane gasoline; and $3.10 for diesel. It was also rejected by the Executive which stated requirements to obtain the subsidy, such as the verification of the identity card and plate, being the documents that support the recognition or payment to the gas stations.

Likewise, there is disagreement regarding the request to establish a permanent commission for the control of fuel prices in the international and national markets. The unions propose that state institutions and the signatory parties of the agreement participate in it; however, the Government indicates that this function currently corresponds to the National Secretariat of Energy, although it proposes to share information and statistics by publishing it monthly on the website of said entity, so that there is greater citizen oversight.

There are also disagreements on the reduction of profit margins and the date for the fulfillment of this measure, the groups requested 6 months extendable, the Executive 3 months extendable.

The fifth point of disagreement was the reactivation of the state-owned Bahía las Minas refinery and the possible establishment of a second refinery in the future. The Government does not agree with the magnitude of the multimillion-dollar investments that the installation of one or several refineries in Panama would require.

Later on Wednesday, the negotiations between the citizens organizations and the government will turn to point 3 on the agenda: better medicine distribution and lower prices.

The single dialogue table was officially installed on July 21 and so far agreement has been reached on the first point, and now partial agreement on point two.

Representatives of the National Government, the National Association for the Rights of the Organized People (Anadepo), the Alianza Pueblo Unidos por la Vida and the leaders of the Ngäbe-Buglé Comarca are participating.  The Catholic Church is in charge of mediation. Likewise, other sectors including business owners, are requesting to be included, supported by President Cortizo. 

Intermittent roadblocks and school closures put considerable pressure on the government to address the numerous cost of living issues which, among other issues, had been building over years.  The spark that lit the fire was the recent increased inflation including fuel prices.

When the talks began a week ago, 8 demands were detailed for discussion.

  1. A lowering of basic food prices without affecting producers. (The first now agreed on)
  2. A lowering and freeze on fuel prices. (Now under discussion)
  3. Supplying the Ministry of Health and Social Security pharmacies with sufficient medicines and lowering their price, without privatizing them.
  4. Complying with a mandate for 6% of the PIB to be earmarked to Education
  5. Lowering the price of electricity
  6. A discussion on Social Security Fund issues.
  7. Addressing corruption and transparency
  8. Establishing a multi-sector mechanism for follow up

Read more news here on Havana Times