Panama's new president takes office, pledges end to corruption

By Elida Moreno
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Panama's new president takes office, pledges end to corruption

Panama's new President Laurentino Cortizo gestures after addressing the audience during his inauguration ceremony, in Panama City

By Elida Moreno

PANAMA CITY (Reuters) - Panama's new President Laurentino "Nito" Cortizo vowed to curb corruption and close the wealth gap in the isthmus nation at his swearing-in ceremony on Monday.

U.S.-educated political veteran Cortizo, 66, of the Democratic Revolution Party (PRD), won the May election by just over two percentage points, the closest presidential race in decades. During his five-year term he will have to balance relations with China and the United States, on top of domestic issues.

Upon taking office at a convention center in the capital, Cortizo repeated campaign vows to clean up politics after Panama's image was tarnished by a corruption scandal involving Brazilian engineering firm Odebrecht, and the Panama Papers leak of millions of documents detailing tax evasion by the rich and powerful.

"We come from a lost decade of corruption and improvisation, of stealing money from Panamanians," he said. "There will be no untouchables, even if they are ministers, deputies and big businessmen, starting with the president himself."

Cortizo said he would propose a new law in Congress, in which his party holds the majority, to ensure clear rules and transparency around public contracts.

Panama's economy grew 5.3% annually on average under former President Juan Carlos Varela, driven by the financial sector, infrastructure spending and revenue from the Panama Canal.

However, Varela rankled the United States by formally establishing diplomatic ties with China, the second-largest client of the Panama Canal, accepting investment in a number of strategic projects and starting to negotiate a free trade deal.

During the campaign, Cortizo said he would continue to deepen ties with China, but has suggested he might move more slowly than Varela.

Cortizo did not mention China in his speech, but in a statement on Monday his office said Panama "valued the relation with the People's Republic of China." It added that he was interested in revising trade agreements with the goal of increasing agricultural exports to the Asian country.

Fixing Panama's inequality and reducing poverty would be among the country's major tasks, Cortizo said.

"The country of bonanza can not hide the country of misery," he said.

Cortizo won a narrow election victory over Romulo Roux, who initially refused to concede defeat. No election in Panama has produced such a close outcome since the 1989 restoration of democracy that followed the U.S. invasion to topple dictator Manuel Noriega.


(Reporting by Elida Moreno, Writing by Daina Beth Solomon; Editing by Bill Berkrot)