Panama Struggles to Shed Its Image as a Magnet for Shady Deals
Byé — December 3, 2016
The New York Times
In August of last year, Panama sought to shed its image as a magnet for shady deals and narco traffickers by paying at least $2 million to host the world’s largest anticorruption conference, now taking place in Panama City.
At the time, it seemed like good idea.
Now, some prominent Panamanians aren’t so sure. Eight months after agreeing to host the conference, the nation was deeply embarrassed when confidential records leaked to journalists revealed that a single Panamanian law firm had created thousands of offshore companies, allowing the wealthy to hide income, some of it from illicit activities. The records became widely known as the “Panama Papers,” a term that so upsets Panamanian officials that some can’t bring themselves to utter it in public.
After the leak, involving millions of legal documents, the president, Juan Carlos Varela, appointed a seven-member commission in April to recommend how to make its financial sector more transparent. That did not work out exactly as planned, either.
For credibility, the president had included Joseph E. Stiglitz, the Nobel laureate economist and a fierce critic of tax havens — onshore and offshore — which he views as the dark side of globalization. What happened next should surprise no one familiar with Panamanian politics or the resolve of Mr. Stiglitz.