A Once-Vibrant City Struggles as Panama Races Ahead on a Wave of Prosperity

Randal C. Archibold, New York Times, March 23, 2013

On one end of the Panama Canal, the nation’s capital gleams with new skyscrapers; a subway, the first in Central America, is under construction; and new malls and restaurants fill with patrons. The city fancies itself a mini-Dubai on the Pacific.

Forty miles away on the other end of the canal, in the city of Colón by the Caribbean, rotting buildings collapse, sewage runs in alleyways, water service is jury-rigged, and crime and despair have sent protesters into the streets. Recently, Hollywood filmmakers made Colón, Panama’s second-largest city, a stand-in for Haiti, the poorest country in the hemisphere.

Panama is booming, with an average economic growth of 9 percent in the past five years, the highest in Latin America. {snip}

Panama City, the capital, has the tallest building in Latin America, a 70-story Trump hotel and condo tower, and its skyscraper forest reflects the rush of foreign investment, real estate speculation, well-heeled foreign transplants and, American officials have said, some measure of drug money.

But Panama can also lay claim to some of the starkest disparities of wealth in Latin America, according to the World Bank, and the persistent poverty in Colón, an hour’s drive from the symbols of wealth in Panama City, remains a glaring, festering example inflaming friction here.

Colón, wedged between a busy port and a handsome cruise ship terminal, is a crowded, cacophonous city of 220,000, with street after street of faded colonial facades and concrete-block buildings with peeling paint and weeds growing out of some upper floors.

“There are hardly any jobs here,” said Orlando Ayaza, 29, who works occasionally at the dock. “Not ones with regular salary and benefits that we need here.” He has a two-inch scar on his face that he attributes to a policeman’s baton during unrest here last year.

When asked why he does not move to Panama City, he touched the dark skin on his arm. “They see this, and you say you are from Colón, and they say, no way,” he said. “They think we are all thieves there.”

Colón is predominantly black, whereas Panama City’s population is more of European descent, and many residents and analysts say they believe that racial discrimination has contributed to Colón’s stagnation.

Such disparities are growing starker in rising economies like Peru, Brazil and Ecuador, said Ronn Pineo, a senior research fellow at the Council on Hemispheric Affairs who studies economic change in Latin America.

“Not every urban area has gone along with the growth,” Mr. Pineo said. “And if there is any kind of racial divide, it is hard for affluence to cross, with the poorer area tending to be one color.”


Colón used to shine. In the early 1900s, during the construction of the canal, and after, it blossomed with theaters, clubs, restaurants and finely manicured boulevards. Old-timers recall distinguished visitors like Albert Einstein.


But as Panama City grew and modernized in the post-World War II era, Colón’s luster wore off. The reduction and ultimate closing of American military bases with the canal’s transfer to Panama in 1999 accelerated Colón’s tailspin. Crime and poverty swelled, and middle-class strivers moved to the suburbs, Panama City or abroad.


“If we all go to Panama City, what’s left here?” said Alma Franklin, 25. She has worked at fast food stores and struggles to feed her three children, but has no faith that the government will help her. “This country,” she said, “would prefer to forget Colón.”


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