A Conversation with Juan Carlos Varela, President of Panama

Alex Sadler / Inter-American Dialogue

On June 21, the Inter-American Dialogue was proud to host Juan Carlos Varela, sitting President of Panama, to discuss a variety of issues with Dialogue President, Michael Shifter. The hour-long conversation focused on confronting the current challenges in Central America, combating corruption and violence in Panama, the recent shift of Panama's diplomatic relations from Taiwan to China, and looking ahead to next year’s Summit of the Americas in Peru.

President Varela began his speech by addressing his Monday meeting (6/19) with President Trump and the shared challenges both leaders face in confronting the drug trafficking issues of Central America and the stalled economic development in the Northern Triangle countries of Honduras, Guatemala, and El Salvador. The Panamanian President called for heavy investment in the private sector in the three countries in order to create jobs and combat inequality. Varela cited the estimated 12-14 billion dollars (USD) the Panama Canal generated since it became a part of the country and declared that Panama is ready to give to the world, including investing for a brighter future in the Northern Triangle.

Transitioning to his own country, President Varela highlighted the strides his administration has made in addressing corruption and violence issues. The President was proud to announce that for the first time in Panama all leaders of the different government agencies are career appointees. His government has invested 800 million dollars (USD) to support bolstering the civil service in numerous government agencies. Varela also cited how his government has successfully decreased the Panamanian homicide rate by 45 percent, making Panama one of the safest countries in Latin America. The President went on to link fighting violence to combating corruption at the same time, as his administration has cracked down on police officers linked with drug traffickers. He also labeled the country a case study for fighting corruption because the current government has been able to give the Attorney General full range in prosecuting corrupt officials while protecting Panama’s economic interests.

The President fielded multiple questions on Panama’s recent decision to cut diplomatic ties with Taiwan and begin relations with China. He discussed a visit he made to China a decade ago where he was able to learn about the country’s reformatted economic system and the high value the Chinese government placed on supporting trade and foreign investment. The trip influenced Varela’s perspective on China and he stated publicly in 2007 that if he was elected president of Panama he would call for diplomatic relations with Beijing. He was proud to have delivered on his decade-long promise. Varela announced that Panama did not receive any special promises or deals from China that influenced his cutting ties with Taiwan, and he went on to say that the main reason for the diplomatic switch was to create business with an open door and to do what’s best for the Panamanian people. At the same time, the President expressed sadness in ending ties with Taiwan, citing that the people of Taiwan had been very good to him and his wife, and called for the two countries to reinstate a diplomatic truce.

Ending the conversation, President Varela looked to the future to discuss his goals for the Summit of the Americas set to be hosted in Peru next year. Addressing the announced Summit theme of combating corruption, the President emphasized his excitement for Panama to bring its experience and success in the anti-corruption fight to serve as a model for other countries. Varela was also hopeful that the meeting would bring President Trump and the next Cuban President together to reopen negotiations about the best path moving forward between the two nations.

Press Coverage of the Event:

La Estrella

InSight Crime

Watch the full recording of the event here: