Conservative supermarket tycoon wins Panama vote

Panamanians elected a conservative, pro-business candidate as their new president Sunday – signaling their hope for a new alternative as the Central American nation's once-booming economy cools.

According to preliminary results released by Panama's electoral tribunal, Ricardo Martinelli of the Democratic Change party, easily won the election with about 60 percent support. He beat Balbina Herrera, the candidate of the ruling Democratic Revolutionary Party (PRD), as well as former president Guillermo Endara, who lagged far behind.

Voters say they were attracted to Mr. Martinelli, because they perceive him as outside the traditional political system that has dominated Panamanian politics since the US invasion of 1989 that dismantled the dictatorship of Manuel Noriega. They also express hope that the supermarket tycoon will bring his business savvy to the chief-of-staff post and help Panama weather the worldwide economic crisis.

"If he has run such a successful company, he can run the country," says Diana Arosemena, a resident of Panama City on her return home from a polling station Sunday, repeating a sentiment heard throughout the nation. She says he has the experience to cut costs and make government run more efficiently.

Panama's economy grew at 9.2 percent last year, one of the highest rates in the world. But it expected to slow dramatically to 3.2 percent this year. "You won't see the same dynamism," says Felipe Chapman, an economist in Panama City. "It will challenge the next government."

Inflation has been a main concern of voters, who punished the ruling party for not making sure that economic boom times trickled down more. A third of the population still lives in poverty, even though the PRD government of Martin Torrijos put money into social programs. "I am part of the PRD, but my government disappointed me," says Raulino Balbuena, a taxi driver in Panama City. "They promised to solve the problem of public transportation, and five years later it's worse."

Promises to tackle crime, expand canal

Martinelli, won runs Panama's largest supermarket chain, promises that he'll tackle crime – which ranks as the top concern of voters, according to opinion polls – as well as invest in education and infrastructure, including the $5.25 billion expansion of the Panama Canal, and prioritize a free trade agreement stalled in the US.

His policies do not differ radically from those of Ms. Herrera, who also supported free trade and foreign investment. He did say, however, that he would simplify the tax code by imposing a flat tax of between 10 and 20 percent.

Martinelli is a self-made businessman and the former minister of Panama Canal affairs. He served in both the ruling and traditional opposition parties, which also gives voters hope that he will be able to work effectively with the political class to get policies pushed forward. "He knows how to work with all sides," says Ms. Arosemena.

High expectations could backfire?

But Carlos Guevara-Mann, a Panamanian political analyst who teaches at the University of Nevada, Reno, says that high voter expectations could backfire. "An incapacity to meet public expectations of a cleaner and more effective government might increase popular discontent," he says.

A big presence with a mop of white hair, his popularity was due in part to the massive money that the multimillionaire poured in to finance his own campaign. While he drew support among the business-oriented class, he also appealed to the poor with media campaigns highlighting efforts such as a charity to improve education.

But Pedro Ayola, a small business owner in Panama City who supports the PRD, says he doubts that Martinelli will care for the poor as the PRD has. "We've worked hard to make the economic gain reach down to the poor and middle classes. Martinelli only cares about the business class and the capitalists," he says. "We're going to lose everything we've fought for."

Mr. Ayola says Herrera was unfairly pegged as a leftist. Indeed, many of those interviewed, from taxi drivers to street vendors, said they were turned off by a perceived affiliation with Venezuela's fiery leftist leader, Hugo Chávez. "The tried to paint her as a 'chavista,' and it's a fallacy."

Others feel that the results will have less of an impact in the direction the country is taking. Mr. Chapman, for example, says that no major change was at stake. "There was no systematic threat to the political or economic system," says Mr. Chapman. "We are not at a critical crossroads."