Panama's government has repealed a measure to sell state-owned land in a duty-free zone along the Panama Canal following a week of sometimes violent protests.

Government spokesman Luis Eduardo Camacho says the government backtracked "to overcome intranquility" — a reference to protests that spread from the Atlantic port of Colon to Panama City on the Pacific. President Ricardo Martinelli signed the repeal decree on Sunday.

The government argued the land sales would create revenue for social projects in Colon. Protesters feared what might happen if private owners take over the area and complained about the likely loss of continuing revenue from the current lease system.