Price Increases

We eat a fair amount of chicken--it's cheap, we like it, it's healthier than red meat, it's in a good many Panamanian dishes, and Mary makes the most fabulous chicken in the province.  The last is enough to keep chicken high on our menu.  Some weeks ago--say 6 weeks (that warped sense of time again)-- pechuga (chicken breasts) went from $.95/lb to $1.05/lb.  Yesterday, Mary paid $1.29/lb, less for encuentro (leg and thigh joint), but I'm sure it went up proportionally. We buy both, but for some reason, only the price of pechuga sticks in my mind. So, since the beginning of the year, the price of that one item has gone up 37%.  I don't know what El Rey and SuperBaru are selling chicken for at this moment, but when we were paying $1.05, pechuga was selling at El Rey--the most expensive store in David--for $1.49.  I can't imagine what the price is now.  

Beef is strictly for the middle class and higher.  Chicken is the meat protein for most Panamanians, since it's affordable or used to be so for the working class.  Clearly, the working class people won't be able to afford to eat it as much or else they'll switch to the cheaper parts such as alas (wings).  As for the poor--forget it, they're already in deep trouble.

Somewhere I read that the official inflation figure here in Panamá was less than 10%, excepting fuel, of course.  Such official BS flies in the face of what is happening on the food front alone.

Because I haven't had time, I haven't been reading La Prensa daily nor have I been following The Panama News as much as I would like.  However, Eric Jackson has been running a few articles that at least touches on the unrest in the Comarcas, or indigenous homelands, and has briefly mentioned the serious unrest among the poor.While certain increases are not the government's fault, there are other problems that don't make international headlines but are important to the daily lives of the people here that are directly related to the corruption in the government, according to Jackson.  Streets in Panama City, sewers that discharge raw sewage into the streets, the miserable lack of funding to keep up schools, and more.

The Torrijos government is widely considered to be really bad, very corrupt government, with the rich getting richer, thanks to corruption on government contracts (that sound familiar at all?), and the poor getting poorer.  The economy is tanking--in part because of world conditions, without question, but also due to the corruption and indifference of the central government.  

Jackson has said that the only reason that there isn't a more pronounced opposition is that so far, there is no real leader around whom the opposition can coalesce.  I personally think that's hard to do, because there is no good way for an opposition party to get organized and become strong.  For example, Brasil elected its current President, Lula, because the PT, his party, built a solid base, electing representatives and senators, mayors, and--extremely important--governors of the various states.  Here in Panamá, the governors of the provinces are appointed by the president.  It doesn't take much imagination to understand how that weakens opposition organization and strengthens the incentives for corruption.  So, it's much harder to develop a political party within the different provinces.  Labor is somewhat organized but as you can imagine, is concentrated in the major urban areas.  The most powerful union is SUNTRACS, the construction workers union.  There is at least one political party more or less associated with the labor movement, but it's small.

There is also an autonomy movement here in Chiriquí, which certainly has my sympathy.  Chiriquí has tremendous resources which are funneled to the central government and either used in the province of Panamá (Panama City) or stolen.

It's hard to avoid the feeling that Panamá has the very real potential to develop into a powder keg.

An addendum:  Bear with what is working out to be Blogger's inability to take paragraphing commands.  blogger is definitely not the best place to blog--it has some really severe limitations--and today I'm unable to do things that were never a problem in the past.  i've been trying to fix it through the Edit function, but so far....

Not yet used to blogging again, so here's yet another addendum: in today's La Gringa's Blogicito, there is an excellent article about the electricity problem in Honduras. Well worth reading.

Blog Guidelines

I've received a request for information about real estate.  

I'm not a real estate agent.  My blog is mostly for me and somewhat to give out information I consider essential to understanding this area and what you're most likely to find here.   I do not promote living in Panamá.  I think most people who want to live here are out of their minds, because they're simply not capable of adapting.  They read International Living, or some other such rag, are stupid enough to believe developers (who make sharks look altruistic), and then come here after a 3 week vacation in the dry season.  I sometimes wonder why I'm putting out all this info, because I know from experience that the people who need to listen the most will nod their heads happily, agree that they know this isn't the US, and then blithely proceed to act as if it is.  You simply can not teach fools.

However, I seem to insist on clinging to the unreasonable belief, for which I have no proof, that if you lay out facts for people, they will act rationally and logically.  All one has to do is read the political news from the US to have that silly notion blasted from one's head, but being an old (literally and figuratively) college instructor, I keep on trying.

Read my blog if you want to, but don't expect any help from me in finding real estate.  Don't waste my time and yours by asking.

On a lighter note:  I'm going to try, every morning, to put out a short post (hard to believe, I know) with a brief summary of what I find interesting in the Panamanian press.

Today: in La Estrella, a short piece quoting the president of the Rice Growers' Association here in Chiriquí as saying that the price of arroz de campo is going to go up due to the increased costs of production.    According to Sr. Arúz, within a few months, the price of rice will increase 25 centavos or more (I have no idea per what).  He says that the rice inventories in the country are low, and that there is a need for incentives for better distribution of rice for maintaining the supply.

Granted that the country imports a good deal of its rice.  Still, the predicted price hike for Panamanian-grown rice is not good news.

From another article in La Estrella, Torrijos is supposed to announce today measure to support both producers and consumers with the high cost of living and of the canásta básica.  this in response mostly to economists who are forecasting a possible crisis of inflation in Panamá.

Possible?  The country has already been experiencing about 10% per year, if not more.  I recently read about a 17% increase in the price of wholesale goods here in the country in April.  

We'll see what Torrijos does.  It's an election year, after all.

Living with Inflation

Panamá is not immune to the sharp increases in food prices and general cost of living. The rise in the prices of gasoline and diesel has been sobering in an area where $10/day is a very good wage, and skilled labor such as electricians and plumbers make $15. I know of at least one death attributable to the rise in gasoline prices. An older man was returning from work on his bicycle, riding on the carretara (highway), when he was struck by a motorcycle and killed. He had started riding his bike because he couldn't afford gas for his old car. Fortunately, bus fares haven't gone up recently; although there has been a big jump in the number of cars on the road, most chiriquenos still use public transport--or walk or ride horses or bicycles.

Sunday's (May 4) La Prensa had most of an entire section devoted to the food crisis and what the situation is in Panamá. Rice grows in this area; you can see the farms in the lowlands outside of David. I had assumed that Panamá produces all the rice it consumes. Not so. Consumption is about 7.5 million quintales (100 lbs) per year; internal production is about 6 million. The big surprise for me was maize (corn). Annual consumption is about 7 million quintales but only 500 thousand of which is for human food--the rest is for animal feed. Since I have yet to see a feed lot in this area (which is not to say they don't exist), one of the major cattle ranching areas of the country, I assume the corn is going to chickens. The Panamanian poultry industry is huge; traditionally, people eat far more chicken than they do beef. But Panamá only produces 1.5 million quintales of maize. The rest is imported.

The biggest part of the problem is that rice and corn land have been converted to growing melons, watermelons and other products that fetch a better price, mainly as exports to the US. According to the newspaper, there has now been some reconversion of land to growing basic grains, but it's not enough fast enough. For 3 years, the government has been encouraging increased yield per hectarea. That's succeeded, but as a recent article in the New York times, I believe (or Washington Post--I read both) pointed out, the cost of chemical fertilizer has also been rising. Thanks to--you guessed it--the rise in fossil fuel prices.

Certainly we've noticed the jump in food prices. When we first came here 4 years ago (Has it only been 4 years? Seems like we've been here a lifetime), rice was just under $.30/lb. It's now close to $.50. In less than 2 years, chicken has jumped about 20%, as has beef.

Our truck runs on diesel which used to be more economical here--usually about $.40/gallon cheaper. Not now--the price of gasoline and diesel is about the same, just under $4.00/gallon. Like just about every other ex-pat we know here in this valley, we've begun conserving by cutting down the number of trips we make to David, which is the major shopping center. For us the bus is NOT cheaper; the cost for two of us is not much less than the cost of a gallon of diesel, which is what we need for a round trip, and the convenience more than makes up for the difference. Plus I really can't see myself lugging two 40 lb bags of dog food, 16 lbs of cat food, two 12 pack cartons of milk and far more by bus. In the end, it actually works out to be cheaper to use the truck. But we are looking at ways to cut our trips to one every 10 days.

There has been some unrest about food prices in Panama City, but so far not much. Part of that is due to what was a thriving economy here in Panamá and probably still is in Panamá City. But the economy here in Chiriquí has been driven by a 4-year construction boom, which has, if not come to an end, slowed sharply. Land prices in Boquete have maxed out, the housing slump in the US has slowed immigration, and construction as a result is limited to last year's sales and commercial construction. We've already started to hear about home foreclosures and layoffs; since we are really out of the information loop, if we're hearing about it, it has to be significant.

Plus there's the problem of reverse immigration, but that's another story.