In my last blog post, I mentioned the expansive political business cycle of incumbent President, Ricardo Martinelli, to secure victory for his party, the center-right Cambio Democrático, and its candidate, José Domingo Arias, in Sunday’s presidential election. Well, this policy has not paid off. At least not in the way Martinelli intended.
Contrary to pre-election polls, and with 93.51 per cent of all votes counted, Juan Carlos Varela of the Partido Panameñista, has won the presidency with 39.19 per cent of the popular vote. José Domingo Arias was second with 31.55 per cent, while Juan Carlos Navarro of the Partido Revolucionario Democrático, was in third place with 27.91 per cent. Between them, the other four remaining candidates did not manage to secure more the two per cent of the vote.
Juan Carlos Varela is the current Vice-President of the incumbent Martinelli, but he was not Martinelli’s chosen successor. Far from it, in fact. Varela, from one of Panama’s richest families and owner of the Varela Hermanos rum distillery, ran in the 2009 presidential race, but stepped aside to support Martinelli in exchange for the vice-presidency. In 2011 however, Martinelli and Varela fell out, when Varela refused to back Martinelli’s plans to change the constitution to allow consecutive presidential terms. Varela was stripped of his additional role as foreign minister and faced vigorous opposition from Martinelli throughout the course of the campaign.
Martinelli, constitutionally barred from running again, but with a 67 per cent approval rating, threw his weight behind his party’s candidate, Arias, a former housing minister. Indeed, Arias’ running mate was Marta Linares, Martinelli’s wife. He energetically swelled the public economy before the election and campaigned from one end of the country to the other. However, this was not enough, despite Varela trailing in polls for the majority of the campaign. In fact, no incumbent party in Panama has managed to retain the executive since the US invasion in 1989.
With economic growth of 8.5 per cent last year, this election was largely contested on valence issues such as crime, albeit with some focus on rising prices. In Panama, the canal looms over all economic policy and Varela, a free-market conservative, is unlikely to alter the economic trajectory set by Martinelli.
The new president takes office on July 1st.