Freedom in the World 2008


President Martin Torrijos in 2007 accepted the resignations of four cabinet ministers in the wake of a scandal over tainted medicine and other consumer products that may have caused the deaths of up to 200 people. Also during the year, the country began a major expansion of the Panama Canal and signed a free-trade agreement with the United States.

Panama was part of Colombia until 1903, when a U.S.-supported revolt resulted in the proclamation of an independent republic. A period of weak civilian rule ended with a 1968 military coup that brought General Omar Torrijos to power. After the signing of the 1977 Panama Canal Treaty with the United States, under which the canal was gradually transferred to Panamanian control by 1999, Torrijos promised democratization. However, a real transition to democracy would not come for another dozen years.

After Torrijos’s death in 1981, General Manuel Noriega emerged as Panamanian Defense Force (PDF) chief. He rigged the 1984 elections to bring the Democratic Revolutionary Party (PRD), then the PDF’s political arm, to power. The Democratic Alliance of Civic Opposition (ADOC) won the 1989 elections, but Noriega annulled the vote and declared himself head of state. He was removed during a U.S. military invasion late that year, and ADOC’s Guillermo Endara became president.

Both the PRD and the Arnulfista Party (PA)—named after the late former president Arnulfo Arias—won elections in the 1990s. Presidential and legislative elections in 2004 returned the PRD to power, with Martin Torrijos, the son of the former strongman, defeating former president Endara of the Solidarity Party (PS) and a number of other candidates. The PRD also won 42 of 78 National Assembly seats, followed by the PA with 17 seats. Several other parties each captured fewer than 10 seats.

Between October 2006 and the end of 2007, as many as 200 people were killed by toxic compounds found in consumer products that were imported from China to Panama, revealing the Ministry of Health’s inability to effectively monitor the quality of medications and other products, such as toothpaste and cold medicine. In August 2007, all 14 Panamanian cabinet ministers offered their resignations to Torrijos, giving him the opportunity to shuffle his cabinet. He accepted the resignation of the ministers of health, education, the interior, and labor. The removal of Labor Minister Reynaldo Rivera was prompted by allegations from the construction workers’ union that several workers had died due to Rivera’s failure to enforce safety rules.

In May 2007, Torrijos and the National Assembly approved criminal code reforms that lengthened sentences for a number of crimes, including libel. The changes drew criticism from journalists and threatened to overwhelm the already beleaguered prison system.

Noriega completed his U.S. prison sentence for drug trafficking in September 2007, but a U.S. judge determined that he could be extradited to France, where he faced money laundering charges. His lawyers appealed the ruling, and he remained in U.S. custody at year’s end. Noriega was seeking to return to Panama, although he faced up to 60 years in prison there for embezzlement and corruption convictions.

Panama signed a free-trade agreement with the United States in June 2007, and the Panamanian legislature ratified it the following month. Critics argued that the agreement would benefit the United States more than Panama, allowing transnational corporations to overwhelm certain Panamanian industries. However, ratification by the U.S. Congress was jeopardized by the August 2007 election of Pedro Miguel Gonzalez as the head of Panama’s legislature. Gonzalez was wanted in the United States for the fatal shooting of a U.S. soldier in June 1992. The lawmaker was tried and acquitted in Panama in 1997, but still faced a U.S. extradition request.

Construction began in September 2007 on a major expansion of the Panama Canal, which would double its current size. Voters had approved the project in a 2006 referendum, but the low turnout of 42 percent raised concerns about public support. Critics maintained that the projected cost of $5.3 billion may have been underestimated and that the funds should instead be used to reduce poverty and improve education and health care. The Panama Canal Authority, however, asserted that the expansion would boost gross domestic product by 2 percent annually.

Despite mounting external debt, Panama’s economy had achieved an 8.1 percent growth rate in 2006. However, nearly 37 percent of Panamanians live in poverty, and the wealthiest 20 percent of the population makes 32 times the average income of the poorest 20 percent. The government raised electricity rates by 30 percent in 2006, but it later emerged that the electricity company’s profits were higher than legally permitted. Officials pledged to build new hydroelectric plants to increase supply and reduce rates.

Political Rights and Civil Liberties: 

Panama is an electoral democracy. The 2004 national elections were considered free and fair by international observers. The president and deputies to the 78-seat unicameral National Assembly are elected by popular vote for five-year terms. The constitution guarantees freedom for political parties and organizations. The PRD recaptured the presidency and a legislative majority in the 2004 elections, causing a shakeup of the various opposition parties in 2005. All of the existing parties were seen as ideologically similar, and two new leftist parties formed in early 2007 as an alternative.

In early 1999, Panama’s largest political parties agreed to ban anonymous campaign contributions in an effort to stem the infiltration of drug money into the political process. Nevertheless, corruption remains widespread. President Martin Torrijos, who took power in 2004, established a commission to deal with corruption under his predecessor, Mireya Moscoso, and to uncover new abuses. He also implemented a transparency law that had been suspended by Moscoso, but has since worked to limit its scope, preventing the release of minutes from cabinet meetings and asset disclosures by public officials. The government’s 2007 budget was negotiated in closed-door sessions, and electoral reforms approved in December 2006 have been criticized as lacking key elements to improve transparency, especially regarding campaign financing. Panama was ranked 94 out of 180 countries surveyed in Transparency International’s 2007 Corruption Perceptions Index.

All of the country’s media outlets are privately owned with the exception of the state-owned television network and a network operated by the Roman Catholic Church. However, there is a considerable concentration of media ownership by relatives and associates of former president Ernesto Perez Balladares of the PRD. There are five national daily newspapers, and internet access is unrestricted. Panama is notable for its harsh legal environment for journalists. In 2005, the country’s restrictive gag rules were repealed and the censorship board was disbanded, but Torrijos in 2007 enacted criminal code reforms that would lengthen sentences for offenses including libel.

Freedom of religion is respected, and academic freedom is generally honored.

Freedom of assembly is recognized, and nongovernmental organizations are free to operate. Although only about 10 percent of the labor force is organized, unions are cohesive and powerful. However, there are limitations on their ability to strike.

The judicial system remains overburdened, inefficient, politicized, and prone to corruption. The Torrijos administration’s 2007 criminal code reforms emphasized longer sentences, leading to questions about the potential repercussions for the penal system and human rights. The State Department’s 2007 human rights report found that pretrial detention sometimes exceeds the maximum sentence for the alleged crime, and that 60 percent of inmates are awaiting trial. The penal system is marked by violent disturbances in decrepit, overcrowded facilities. Panama has a high prisoner-to-public ratio, with 354 inmates for every 100,000 residents.

The military was formally abolished in 1994. The police and other security forces that remain, while accountable to civilian authorities through a publicly disclosed budget, are poorly disciplined and corrupt. Like the country’s prison guards, police officers frequently use excessive force, and in 2005, several high-ranking officers were accused of sexually abusing minors.

Drug trafficking and related violence continued to plague Panama in 2007. The overall success of the government’s counternarcotics campaign has been limited by a lack of resources, weak border enforcement, and corruption. In addition, money laundering, human trafficking, and the presence of Colombian guerrilla and paramilitary forces along the southern border remain causes for concern. Refugees from Colombia have faced difficulty obtaining work permits and other forms of legal recognition.

Discrimination against darker-skinned Panamanians is widespread. The country’s Asian, Middle Eastern, and indigenous populations are similarly singled out. Indigenous communities enjoy a degree of autonomy and self-government, but some 90 percent of the indigenous population lives in extreme poverty. Since 1993, indigenous groups have protested the encroachment of illegal settlers on their lands and government delays in formally demarcating them. Legislation proposed in 2006 to recognize indigenous territorial rights has been postponed indefinitely. The government in 2007 authorized the exploration of gold and copper reserves by Petaquilla Minerals, prompting public protests, particularly from indigenous activists who claimed that mining would have adverse effects on their land and the environment.

Violence against women and children is widespread and common. An increase in juvenile crime in 2007 led to a proposal to increase jail sentences for juvenile offenders. Panama is a source, destination, and transit country for human trafficking. The government has worked with the International Labor Organization on information campaigns addressing the issue, and it has created a special unit to investigate cases of trafficking for the purpose of prostitution. However, the resources dedicated to this unit and other efforts to combat trafficking remain insufficient. The U.S. State Department’s 2007 Trafficking in Persons Report lists Panama as a Tier 2 country and claims that it does not fully comply with minimum international standards to combat human trafficking. While Panamanian law does not prohibit all forms of trafficking, it does criminalize trafficking for commercial sexual exploitation. Prosecutors obtained the first conviction under that provision in 2007.

2008 Scores



Freedom Rating

(1 = best, 7 = worst)

Civil Liberties

(1 = best, 7 = worst)

Political Rights

(1 = best, 7 = worst)