A failed (and unconstitutional) attempt to modify ACP’s budget: Beyond Barria’s case

PANAMA - Report 25 Sep 2017 by Marco Fernandez

Article 220 of Panama's Political Constitution asserts that The Panama Canal Authority (ACP) will present its budget proposal to the Cabinet, which in turn is subject to Congress for its examination, approval, or rejection (Chapter 2, Title 9 of the Panamanian Constitution). This is the basis of the administrative and financial independence of the ACP, the state agency that operates the Canal. The ACP is directed by an administrator who is appointed by the Board of Directors for five years (renewable only once) and approved by the National Assembly. The Board of Directors has eleven members, one appointed by the National Assembly and the rest appointed by the Executive rotated for nine years. This seeks to minimize the influence of any government on the quorum. The ACP's budget can only be approved or rejected, but not modified. In the past, the budgets presented by the administration to the National Assembly were approved immediately.

Nonetheless, an unprecedented event happened on September 18, 2017. Luis Barria, a member of the National Assembly and president of the Budget Commission (also a member of the ruling Panameñista Party), rejected the ACP´s budget proposal, arguing that the Canal transfers to the Central Government should be greater. Barria argued the Canal should transfer $141 million in addition to the proposed amount of $1.66 billion (or 22% of Central Government current revenues).

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