Torrijos plays Santa to Panama

PANAMA. Santa Clause, in the shape of President Martin Torrijos has brought a much needed early Christmas gift to long suffering Panamanians. Starting in December and continuing into 2009, electricity bills will drop the hated “fuel supplement. ”

According to Torrijos and his administration, the elimination of this supplement plus a reduction in electricity price rates foreseen for January, will translate into a monthly reduction of 20 to 25 percent.

The $50 million in subsidies for users that use less than 500 kilowatts-hour (kWh) will continue, as well as the established price ceiling system for gasoline.

On that note, President Torrijos announced an immediate 15 cents reduction on all fuels.

Reactions to Torrijos’ announcement were quick to come from different sectors.

Roberto Alfaro, president of the Panamanian Association of Business Executives (APEDE) saw the move as “positive, needed, and just.”

Alfaro said the elimination of the fuel supplement should have occurred months ago, as the international price of crude oil has been low for a while now.

From his perspective, the next step should be to reduce the cost of kilowatts per hour, which would bring a greater benefit for all.

Rafael Chavarria of the Workers Confederation of Panama, agreed with Alfaro, stating that “the measure is good.”

According to Chavarria, the ideal scenario would be to tell all businessmen and supermarket owners to lower the prices of goods in the main foods basket.

Javier Pariente, vicepresident and manager of Elektra Noreste, stated that “this is a clear result of the significant fall in the prices of oil and its derivatives at an international level, which has allowed these type of decisions to be taken.”

He added that this decision has no impact on the company as it is exclusively directed towards the electricity generating facilities, whose costs are paid by the distributors and transferred to clients without additions.

On the other hand, spokespeople of Union Fenosa said that they are waiting for the resolution that orders the changes, which should explain the source of the funds that will make the abolition of the fuel clause possible.