Panama's president emerges as unlikely champion of clean government as net closes on ex-ally

President Juan Carlos Varela is an unlikely champion of clean government in Panama.

He is the leader of the oldest political party in a country long perceived as one of Latin America's most corrupt. And he served as vice president in the free-spending, scandal-ridden government of his predecessor, Ricardo Martinelli, opening his mouth to publicly criticize the now disgraced former leader only when he was pushed aside by his one-time ally.

Yet, since Varela's surprise come-from-behind election victory last year, the scion of one of Panama's richest families has deftly ridden a groundswell of popular rage with politics as usual.

Driven by a steady flow of media leaks and confessions by former officials, prosecutors have opened corruption investigations against more than 12 Martinelli aides and allies. Several have already been jailed and Martinelli himself has fled the country while the Supreme Court weighs lifting his immunity from prosecution.

Panamanians, who since Gen. Manuel Noriega's dictatorship have grown accustomed to seeing elected officials raid government coffers, have been cheering the new emphasis on probity. They have rewarded Varela with a 60 percent approval rating — the highest of any head of state in Latin America and almost double the level of support he got in narrowly winning the presidency.

"For us politics is service, it's not business," Varela said in an interview at the presidential palace Tuesday, two days before he plays host to U.S. President Barack Obama and some 30 other regional leaders at the Summit of the Americas. "The people gave me the opportunity (to lead) because they knew we are here to serve them and not to use them."

Varela assures that the house-cleaning is motivated by a desire to restore Panamanians' faith in institutions. He says the corruption under Martinelli that is coming to light is on a grander scale than he or anyone else had imagined, and he insists that anyone in his government caught stealing will also be punished.

"Justice is for everybody. Justice isn't just for the past government," Varela said at the seafront Herons' Palace, named for the long-beaked coastal birds that roam the colonial courtyard.

Analysts, however, say there is a heavy dose of political payback in the anti-corruption campaign.

The 51-year-old Georgia Tech graduate formed a coalition with the newcomer Martinelli to win the 2009 election, serving as his running mate. But relations were tense from the outset and two years into Martinelli's presidency, Varela was fired from his second post as foreign minister. Varela held onto his elected post as vice president and went on to denounce, somewhat timidly at first, corruption within the government.

The investigations underway have been steadily closing in on Martinelli's inner circle. His former Supreme Court chief justice was sentenced to five years in prison after admitting he amassed a fortune in real estate incompatible with his magistrate's salary.

Two other close Martinelli allies, the former heads of the government's marquee National Assistance Program, have been arrested on charges they siphoned off an estimated $60 million from contracts for the purchase of food and backpacks for children. Both said they were acting on orders from Martinelli.

Varela rejects the notion that he is pursuing a vendetta, saying that friends and even a relative who sat on the National Assistance Program's board and signed off on the fraudulent contracts are among those implicated.

In January, Martinelli left Panama on his private jet, a day after the Supreme Court took steps to lift his immunity as a member of the Central American parliament. He has said he will return only when he is confident he can mount a defense without fear of political retribution.

"I was elected to serve 4 million Panamanians, not to persecute one former president," Varela said. "He has to face justice. That's his problem, not mine."


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