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?