PANAMA CITY, Panama – On a cloudy autumn morning a flock of chocolate-brown sandpipers slipped across the horizon toward a stretch of mangrove trees and mud flats outside Panama City, hunting for food and a resting spot on the long trip down from North America.
A short distance away, heavy trucks hauled sand and cement, and cranes hoisted building materials to the future site of a country club and golf course. Work crews had already cleared a swath of mangroves, leaving bare stumps in one of Central America's most important migratory bird habitats.
The price of growth is clear here, as a multi-year boom in Central America's fastest-growing economy has unleashed a wave of development along the Bay of Panama.
Environmentalists warn that the construction threatens one of the world's richest ecosystems and the habitat for vast numbers of North American shorebirds.
On top of that, half a million people, or about a sixth of all Panamanians, live close to the bay, and its mangrove trees and wetlands help break powerful water flows and absorb heavy rain. Strong flooding in 2004 killed 16 people in communities along the bay.
The environmentalists have won at least the temporary backing of Panama City's mayor, who has declared a freeze on new projects pending a scientific study. At least 21 projects are proposed for the Bay of Panama, with about half already under way and many of the rest frozen while the mayor waits for the study.
"Of course I'm afraid that these projects will leave us unprotected from natural disasters," said Hilda Velasco, 77, a retiree who lives in a modest cement-block home in the village of Juan Diaz, where residents have been protesting the construction with street banners for the last few years. "The people who are going to live in these luxurious homes on the bay are not going to suffer from the ruin."
Developers, meanwhile, are backed by the pro-business national government, which is trying to permanently shrink the area protected by an international wetlands treaty.
Panama's government says it's committed to protecting the bay, but adds that it must accommodate the inevitable spillover of development from Panama City.
"Our responsibility and interests lie in the conservation and protection of natural resources, but we can't turn our back on reality," said Silvano Vergara, administrator of Panama's National Environmental Authority. "We're seeking to arrive at a consensus that sets the boundaries of the protected area and protects it effectively, not just on paper. We want everyone involved to be aware that these areas must be protected."
Panama has Central America's largest areas of mangroves, a diverse type of vegetation that thrives in brackish or salty water. The towering trees native to its Pacific Coast, which can soar some 130 feet (40 meters) high, are among the tallest mangroves in the world, said Alida Spadafora, director of Panama's Association for the Conservation of Nature.
A 1997 study by the Smithsonian Tropical Research Institute and the Center for Conservation Biology at the College of William and Mary in Virginia found that 1 million birds a year use the wetlands and other parts of the Bay of Panama on trips between North and South America. The study said 36 of the 49 species of shorebirds that reproduce in North America use the bay as a stopping point, including many varieties of sandpipers and plovers, Willets, short-billed dowitchers and whimbrels.
In 2009, the Panamanian government declared 330 square miles (85,652 hectares) of wetlands a protected area under the Ramsar Convention, a 1971 treaty in which 163 countries committed not to promote projects that alter wetlands ecosystems.
At the same time, Panama has seen the strongest economic growth of any Latin American country, thanks to a boom in construction, tourism and Panama Canal shipping. The economy grew by an average of 8.8 percent a year from 2006 to 2011 and is expected to top the region again this year with 9.5 percent growth, spurring high-end skyscrapers and other developments at the edges of the capital and putting new pressure on the bay.
An even bigger development push got under way in July 2009, when Ricardo Martinelli, a multimillionaire entrepreneur and conservative populist, became president.
He quickly tried to spur investment and extend development throughout the Bay of Panama.
In April, the Supreme Court suspended the protection of the Ramsar Convention, saying the country's former administration failed to carry out the required public consultation when protecting the area under the treaty. Critics claim the government has overly influenced the court, with three of its nine members and its current president appointed by Martinelli.
In May, the Martinelli-chosen Water Resources Authority lowered the fine for illegal cutting of the mangrove forest from $300,000 per hectare (2.5 acres) to $40,000, saying violators were having trouble paying the higher fine.
The decisions accelerated development in the bay but also prompted environmentalist outrage. Panama City Mayor Roxana Mendez in June then barred construction, the removal of soil and the filling in of wetlands, using her powers to oversee all building in the municipality of Panama, which includes much of the bay.
On hold for now are projects that would be partly or wholly inside the wetlands, including an industrial park and a 1,235-acre (500-hectare) residential development with a golf course and country club.
Environmentalists say they don't oppose development, but want to protect important coastal lands.
"The city has to grow, but there are other areas," said George Angehr of the Smithsonian Tropical Research Institute, an expert on the Panama Bay. "But destroying the mangroves has a cost for the entire country."