| The receptionist
was small and round and dressed in a uniform with a name tag; she stared
at me with suspicion and talked to me in Spanish in a kind of mock deep-voice
that sounded robotic. I liked that: she was tense; a good sign, maybe?
She asked me to fill out an information card.
Then she put
little colored wrist bands on our arms that would allow us to enter the
water park the next day, and the key to the room. We jumped in the car
and drove down a lane that led to where the rooms were located. Each room
had a covered car park above which was a sign that gave the room number.
There were many rooms and we drove and drove past rooms and numbers. Finally
we found the room, but not before getting lost.
We entered
our room through a door off the car park. Every room has two doors at El
Camping Resort: one door off the car park and one door that opens to
the interior of the resort. The room was old but clean. The room had a
refrigerator, air conditioner, sofa and hot water. The frame of the double
bed was covered with padded leather and the headboard was a kind of plastic
mold that came away from the wall like a relief. Behind the molding was
a mirror. The small reading light had a florescent light in it rather than
a bulb, a very Panamanian touch. There was a dial that you turned in order
to have music piped into your room. The price of the room was $39.95.
When I entered
the room and put down my bags I immediately wanted a drink; it was Friday
at six and so time for something to drink; the walls of the place seemed
to drip alcohol; I remembered that from my first visit. We sat and talked
and walked out by the pool. There was an older American/Panamanian couple
sitting by the pool and their children were swimming. They looked happy
to be there. A young and very pretty Panamanian couple jumped around in
the pool as well. I looked around and saw a 1980s looking open air gym
next to the pool, two or three very large hot tubs that were empty and
a number of picnic areas that were private and set back from the pool.
The mosquitoes started to bite and so we headed back inside and changed
for dinner. As we walked to the restaurant we noticed that there was almost
nobody in the Resort. The Resort is filled with dead spaces. Spaces you
couldn’t imagine people doing anything in. Benches and mirrors and ice
makers are placed in spaces that seem devoid of meaning; the sound of pool
pumps and ice makers and salsa music filled the empty spaces, neon lights
and purple shadows shot across red brick. I liked it: Not seedy by any
means; the seedy times had died off and now the place had taken on another
veneer, a more peaceful and relaxed veneer; it was a modern relic.
The Resort
has a good restaurant. Just a simple Spanish diner with a bar and excellent
seafood. In the States they say beer and pizza. Forget that; try Panamanian
seafood and beer; they had Grolsch which surprised me. The seafood was
excellent. North Americans know nothing about cooking fish, except in the
American south; but the quality of the seafood in Panama is the best, even
if you aren’t crazy about seafood, try Panamanian seafood. After dinner
we went bowling in the Resort. They have a very good bowling alley and
there is a bar right next to the bowling alley that serves great drinks.
There were a couple of people sitting around watching T.V.: two employees
a cop and a guest. We bowled for an hour. On our way from the bowling alley
to the bar we passed an indoor tennis court. The bar had a heavier environment
with older gentleman drinking hard and people dancing to salsa; off the
bar was a large dance area which played mid-90s merengue and salsa music.
In another room there were pool tables. The bar disco had orange lights
that burned and moved around as though they were actual flames. The drinks
were excellent. I decent cocktail cost four dollars.
We didn’t stay
long and went back to the room and crashed. A rain came in during the night.
We woke up the next day and went to the water park. There were few people
and we enjoyed the water slides and pools. The sun came out and we all
got a suntan. There was loud salsa music on the stereo system; the other
end of the water park was quiet. We stayed until noon and then packed up
and headed back to our house which was only a short 25 minute ride from
El
Camping Resort.
Chinese
In Latin America
A wave of immigrants
from China’s Canton Province, who were escaping the destruction caused
by the opium wars (1839–42 and 1856–60), began arriving in Central and
South America in the 1840s and 1850s. A large portion of these immigrants
were indentured servants and were treated like slaves in Latin America.
In Panama, Chinese coolies worked on the transatlantic railroad from 1851
to 1855. One thousand Chinese arrived straight from China to work on the
railroad; in order to make themselves feel comfortable they brought their
own rice, opium and tea. They lived near the seaside in Panama City in
the area of the city that is today called Chinatown. They smoked opium
to keep their minds off the terrible working conditions they encountered
in Panama. But even with the small comforts from home, the Chinese quickly
became depressed, so depressed in fact, that they became suicidal - they
hung themselves from trees by their own pigtails. Within a month or two
of their arrival their numbers were reduced to less than 200; most eventually
died off from disease and depression. But the process of Chinese immigration
started with the building of the transatlantic railroad in Panama and it
would only increase as the 19th century came to a close.
In South America
Chinese indentured servants worked on the guano islands off the coast of
Peru. Guano, a type of sea-bird excrement, was used in Europe in the 19th
century as a fertilizer, especially in Scotland where farmers needed to
rejuvenate the soil with a strong natural fertilizer as the topsoil in
Scottish fields was very thin: the Scottish turnip crop needed large amounts
of guano to thrive. The Lobos and Chinchas island groups off the coast
of Peru were one of the few places on earth that were known to have large
deposits of guano; the other known source was the West African island of
Ichaboe, which today is part of Namibia. But the African supply of guano
disappeared in the 1840s and Peru became the major source of guano for
the British.
The harvesting
of guano was not easy on these very remote islands and in order to be paid
each Chinese worker needed to cart at least eighty wheelbarrow loads of
guano a day; in return for this back-breaking work they would receive a
shilling a week from the British company that owned the rights to the guano.
When the working conditions on the islands became too severe for the Chinese,
as they often did, and when their depression was stronger than the opium
they smoked to escape the here and now, they would join hands – sometimes
as many as fifty at a time – and jump into the sea to their deaths. The
Chinese would work and barely survive on the guano islands from 1849 to
1861: the years that the British company Anthony Gibbs held an exclusive
contract for the overseas sales of Peruvian guano.
The guano crop
was essential to the solvency of the Peruvian government which in the years
1826 to 1849 was unable to negotiate any new international loans on the
capital markets of London. When the countries of Latin America gained their
independence in the early 1820s they were immediately offered large loans
from the city of London; most of the loans were based on gold, silver and
land speculation. A lot of investors in Europe were tricked into making
bad investments in Latin America during the bubble economy of 1822-24.
One of the most famous hucksters from that first wave of “hot money” that
arrived in Latin America – there would be much more “hot money” in the
following century - was a Scotsman by the name Gregor MacGregor. MacGregor
arrived in Venezuela during the wars of liberation; he would have arrived
in Venezuela in 1815, he might have fought in the Napoleonic Wars and then
come to Latin America: many did. MacGregor must have been something else
as he was known for his kilt and bagpipes and wild ideas as well as his
military prowess. The different climate and terrain must have made it hard
for a Scotsman to fight in Venezuela. MacGregor fought with Bolivar in
what was called the Albion Legion: British fighters who fought on the side
of the liberation forces against Spain. MacGregor only lasted for a short
time in the Albion Legion but was able to score a number of victories for
the liberation forces. But after quarreling with the liberation leaders
over strategy he left Venezuela, but he would eventually marry Bolivar’s
niece and carry out raids in Florida, Portobello, Panama and Riohacha,
Colombia. In 1822 MacGregor let the word out in Great Britain that he owned
miles of land on the Caribbean coast of Honduras. He was looking for investors
to bank roll his new community in Honduras: through his tireless efforts
he was able to raise 200,000 pounds for the project. He even tried to entice
the Rothschild family into investing by telling them that he planned to
create a Hebrew colony on the Honduran island of Roatan. They declined
and saved themselves some money by doing so.
Most of the
loans that were extended to Latin America in the 1822-24 bubble ended up
being a disaster and investors in Britain lost their shirts because they
had been conned into believing wild stories of gold and silver deposits
that either didn’t exist or were impossible to mine. Latin American governments
also defaulted on their bonds as the wars of liberation from Spain had
destroyed their economies and most of the state treasuries were empty.
Only Brazil was able to escape default in the 1820s due to the fact that
there were no wars of liberation in Brazil; its liberation was a relatively
smooth affair and it retained its Portuguese monarchy until 1889, when
it too would become a republic. Brazil’s close relationship to England
and the Rothschild family would allow it to stay solvent when most countries
in the region went belly up. It would take Latin America fifty years
to get out of the economic hole that was created in the 1820s – for those
fifty years the states in the region fell into dictatorships and darkness.
The 1820s crash is often referred to as the first international financial
crisis as it was the first time that large amounts of speculative capital
moved across continents and it connected distant free markets and distant
free governments with each other. This was not a formal colonial relationship,
but rather an unequal one.
Peru escaped
the “debt crisis” of the 1820s because of the guano revolution of the 1840s:
from 1849, the start of the guano boom, until 1874, the country would receive
£52 million in new loans from overseas banks. That was more money
than Mexico, Brazil and Argentina combined received in the same period
of time.
Funny to think
that Chinese labor, in the service of British interests, and working on
remote Peruvian islands, was used to harvest bird shit that was sent half-way
around the world so that Scottish farmers could grow healthy turnips and
Peru could escape its debt problem: what a wonderful and terrible world
we live in!
I should return
to the role of the Chinese in 19th century Latin America. After the mid-19th
century some Latin American states – Costa Rica, for example – established
laws that forbade the immigration of Chinese into their countries; the
argument was that they would flood the local culture with alien ideas and
customs as well as taking part of the national wealth. Panama has very
strict immigration laws that exclude Chinese immigrants, but these laws
date from the 1940s and are very rarely applied today.
Of all the
expat groups that I have encountered in Latin America none integrate themselves
into the local environment better than the Chinese. Wherever they go the
Chinese adapt to the local environment; they never complain and they mix
very quickly with the local people: marrying locals and starting families.
Most Chinese arrive in Latin America straight from southern China and within
two to three months of arriving in their new home are able to speak Spanish
and work and thrive in the local economy. Normally they start small shops
that sell necessities – soap, sodas, cooking oil, alcohol, propane gas,
and cigarettes - that people need in Panamanian neighborhoods. The Chinese
sell small rather than big: they will sell not packs of cigarettes, but
individual cigarettes; they will sell individual portions of cooking oil
rather than large containers. By selling both large and small they attract
rich and poor customers. For the Chinese the position that their shop plays
in the lives of the people in the neighborhood where they work is extremely
important to their success as business owners. And the degree of their
success will determine the family’s status within the Chinese community
in Panama. From the counters of their small shops they will build a business
one penny at a time until they diversify into other businesses. Typically,
a Chinese entrepreneur will start with a small shop, and then start a dry
cleaning business, laundermat, car wash or restaurant. The second generation
will be better educated than the generation that arrived in Latin America.
Normally, the second generation will move into larger businesses like construction,
banking and trading, or professions like accounting, medicine or law.
Part of the
reason for the success of the Chinese in Latin America is due to the fact
that the Chinese are a tight knit community and therefore help each other
by financing “Chinese” projects: new shops, apartment buildings, banks
or restaurants. This gives Chinese business owners access to capital and
credit; two things that are in short supply in most Latin American countries.
Another reason for success among the Chinese is their connections with
mainland China; these connections with the “motherland” allow Chinese merchants
to import inexpensive goods from China which they can sell throughout Latin
America. As most people know, China is becoming the factory of the world
and so Chinese merchants in places like the Free Zone of Panama are making
great profits by selling inexpensive Chinese goods in Latin America. For
example, Chinese merchants will buy clothing in Hong Kong for 2 cents a
piece, then turnaround and sell that same piece of clothing for three dollars
in Latin America. Most products from China will arrive in the Free Zone
in Panama and from there will be sold in countries like Venezuela, Colombia,
Ecuador and the countries of Central America. So today, many of the products
that people in Latin America need for their daily survival come from China.
Chinese influence
in Latin America is beginning to expand as their power worldwide grows.
China is a rising power and like any rising power they are pushing into
the hinterlands of the globe, something the U.S. did in the late 19th and
early 20th centuries. This push for growing influence overseas began when
China started to import energy for the first time in 1993; ever since,
one of the most important elements in Chinese foreign policy has been the
search for new sources of energy: Latin America has oil and natural gas
and is therefore an attractive region for the Chinese government. In fact,
in December 2004 China completed an oil agreement with Venezuela.
The Andean
countries (Colombia, Ecuador and Venezuela) are the Latin American countries
that are most attractive to China: they have rich supplies of oil and gas
– and two of the countries – Colombia and Ecuador - are not members of
OPEC; also, these countries are geographically far enough away from the
U.S. so that they can develop a relationship with China without upsetting
the U.S. In addition, the Andean community – the regional organization
that Ecuador, Colombia and Venezuela belong to – is very weak and has not
set up trade barriers to non-member states. This allows China to enter
the region without political or economic barriers. It would be hard to
imagine China creating a close relationship with, say, Mexico over energy
supplies or trade, since Mexico is a member of NAFTA.
In contrast
to the Andean countries, Chinese interest in Central America and Panama
is not as strong – though there is always interest in Panama - since there
are not as many natural resources, but more importantly, both Central America
and Panama (and Paraguay) have had official diplomatic relations with Taiwan
since its creation and this has upset the Chinese government. In fact,
China has harassed countries like Costa Rica and Guatemala for having friendly
relations with Taiwan
The Taiwanese
government has very strong government to government relations with Central
American states and Panama. The strength is due to Taiwan’s foreign policy
which has also been called its “money policy”: giving diplomatic recognition
to Taiwan means a large aid package for the recognition. In Panama
the Taiwanese government gives large amounts of aid to agricultural projects:
most of the projects are aimed at introducing “wet rice” cultivation, something
that has been largely a failure since Panama is a “dry rice” country –
meaning rice is cultivated on dry hillsides rather than in ponds. The Taiwanese
have also built schools and office buildings in Panama City as well as
port facilities. In Paraguay, the Taiwanese have trained the national police
and during the military years in Panama the Taiwanese military trained
the Panamanian military; in return Taiwanese secret agents would get Panamanian
passports which would allow them to move around the world without being
identified as Taiwanese: all of this is in the past.
Because of
the close relationship between Taiwan and Central America many of the recent
Chinese immigrants in Central America are from Taiwan not mainland China.
The Taiwanese are seen as being richer than mainland Chinese, they are
known for operating much larger businesses than mainland Chinese and they
are also known to move around the region much more frequently than mainland
Chinese.
Taiwanese immigrants
are attracted to Panama because of the high taxes back home, compulsory
military service in Taiwan and the discrimination against Taiwanese products
in other areas of the world. Many Taiwanese in Panama move around Central
America to places like Costa Rica where they buy and sell fish or bananas,
others go to Paraguay where they are able to trade with larger countries
in Latin America such as Brazil and Argentina. In Cuidad de Este, Paraguay,
Taiwanese traders sell products to Brazilians who cross over the Amistad
Bridge into Paraguay where their money has greater value than in Brazil.
However, since 1998, when Brazil cut the value of it currency, the trade
in Cuidad de Este has dried up and many of the Taiwanese traders have moved
back to Panama to work in a special Free Zone that was created just for
them by the Panamanian government. The Free Zone is known as Camp David
but has not been a great success so far. Because of this the Taiwanese
have moved on to Hati where the Taiwanese government has subsidized Taiwanese
construction firms so that they can win Haitian government road building
contracts.
However, for
many Chinese, both Taiwanese and mainland Chinese, Central America is not
a place to succeed in business, but rather just a stop on the way to the
U.S. or Canada. It’s much easier for the Chinese who want to immigrate
into the U.S. or Canada to first stop in Central America. If they are able
to get residency in Central America then they should be able to get residency
in the U.S. or Canada. In the past, Chinese who wanted to go to the U.S.
or Canada would enter Panama by investing in land. Normally they would
open a corporation and through that corporation buy land: that process
entitled them to residency. While getting residency in Panama they would
apply for residency to the U.S. which they would often get with little
problem. Once they had residency in the U.S. they would immediately leave
Panama; they would also leave behind the corporation they had formed and
the plot of land they bought. I have seen plots of land in Panama that
are owned by hundreds of Chinese who left the country years ago and have
never come back to do anything with their land; they disappeared into thin
air; Panama was just a stop on the way to the U.S or Canada.
Now why all
this talk about the Chinese in Latin America? Because you are hearing more
and more that the Chinese are trying to control the Panama Canal. I have
read this in a number of articles recently and I am asked about it by people
who live outside of Panama. Now your average person who knows nothing about
Panama – and I hope I have helped changed this misperception somewhat –
thinks Panama is the Canal; that there is nothing else in Panama. And when
they hear the Chinese are taking over the Canal they have visions of Chinese
soldiers climbing the locks of the Canal and flying red flags. The idea
that the Chinese can control the Canal is an idea so ludicrous that it
ranks up there with notion that the Sandinista government of Nicaragua
in the 1980s had the potential to over run Mexico and then California –
an idea that was fed to the American public for ideological reasons during
the 1980s by the executive branch of the U.S. government. What people are
talking about when they say the Chinese might take control of the Canal
is not military action but rather economic action. And this is the dilemma:
The Canal was finished in 1914; at the time of its completion the size
of locks, which ships must pass through to go from ocean to ocean, were
large enough to handle any size ship: Panamax was the name given to ships
that could pass through the Canal. But as ships became bigger – think U.S.
aircraft carriers – the locks of the Canal were too small to handle the
new larger sized ships. So the U.S. government decided in 1939 to build
a third set of locks that could handle the new larger ships. The expansion
was also important to winning the Second World War: the Atlantic supply
lines could eventually be directed to the U.S. Pacific fleet when the war
in Europe was over. Some excavation was done on the third set of locks
but the project was eventually cancelled because the money set aside for
the new locks was eventually transferred to the Manhattan Project in Los
Alamos, New Mexico.
The third set
of locks was never built. After the war the project was not resumed and
after the Suez Canal crisis of 1956 the writing was on the wall that the
Panama Canal would someday be turned over to Panama: in the same way that
the Suez Canal had been turned over to Egypt in 1956. So from 1956 on there
was no move to enlarge the Canal. After the turnover of the Canal – 1977-79
– the political problems in Panama during the 1980s which culminated in
the invasion of Panama did not allow any discussion on enlarging the Canal.
Since the U.S. invasion of Panama in 1989 there have been 15 years of democratic
rule in the country. So now is the time to enlarge the Canal; the fear
in Panama is if this does not happen then the Canal will become obsolete
and, if the most important resource Panama has becomes obsolete, then the
country of Panama will be in very serious trouble. No Canal, no Panama.
The argument for expanding the Canal by building a third set of locks is
that there will be more jobs in Panama, more shipping traffic, and the
expansion will place the future of Panama on a secure path.
Sounds simple
enough, right. Wrong! The question now is where will the money come from
for the new set of locks and how will it be raised. There are three possible
scenarios floating around. One is that the money for the new locks will
come from Wall Street; that the Panamanian government will ask for 12 billion
in loans – the cost of the new locks – from Wall Street bankers.
There are some
signs that this is what will happen. For one, the Panamanian government
has recently passed a law raising the retirement age and decreasing the
benefits people will receive when they retire. A clear sign they are tightening
their belt. Some say that the government is decreasing their future obligations
so as to put themselves on a better footing with the bankers. The government
has also raised new taxes and ended a lot of the tax loopholes that the
country was once famous for. Fair enough: cut state benefits; increase
taxes. Not a normal move by a Panamanian government and one that has enraged
the public. When politicians do things that make them very unpopular, especially
in Latin America, where nothing is ever really fixed by the government,
then people wonder what is going on. The idea of the Panamanian government
taking on large loans scares people as they remember the debt the country
accrued in the 70s and 80s: at one time every Panamanian, man, woman, and
child was 1,325 dollars in debt to foreign banks. They are also upset because
in 1980 one-hundred million dollars disappeared from the social security
system and was never recovered. But this is the present and that was the
past. Many Panamanians tell me that they fear the new loan money will disappear
like the old loan money.
Another possible
scenario is that the money for the new locks will come from China or another
Asian country: something the U.S. would not want. In this case, China,
say, loans Panama the money and because they are the holders of Panamanian
loans will control the Canal and the Panamanian government – a paranoid
scenario. But the Chinese are running Balboa port which is located on the
Pacific side of Panama; and the Taiwanese are running the port on the Caribbean
side of the Canal and so the U.S. worries about Chinese influence. You
have to remember that 12% to 14% of American trade goes through the Canal
– 4% of worldwide trade passes through the Canal. A lot of this anger on
the part of the U.S. is also due to the fact that they are still upset
about the ports going to the Chinese; originally they were to go to Bechtel
construction out of San Francisco, California, but a last minute change
was made and the Chinese received the contracts. The Panamanian telephone
and electric companies were also sold off to foreign corporations but none
of them were American: the telephone went to a British company, Cable &
Wireless, and the electric company went to the Spanish company Fenosa.
So globalization has not worked to the favor of the U.S. in Panama.
The final scenario,
the” happy scenario” is that the institution that runs the Panama Canal
and the international shipping companies that oversee the Canal will be
the ones who provide the financing for the new locks. Here the institutional
strength of the Canal administration puts aside the desires of the Panamanian
government and leads the expansion of the Canal separately from the government.
This is unlikely as any expansion of the Canal must be approved by a national
referendum. And the government would have to be onboard in order to get
the votes. The national referendum clause was written into the constitution
of Panama after the Canal was turned over. The question in the end will
be decided by the Panamanian public: 70% of whom support the idea of expansion.
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