Foreign investment down.

FOREIGN INVESTMENT DOWN. In the first quarter of 2005 foreign investment in Panama declined by 24.4% vs. the same period in 2004, said the Ministry of Economy & Finance, reports The Panama News (July 17-Aug. 6, 2005). Last year there was uncertainty about whether tax exonerations for new construction would be continued at 20 years after year's end, so a lot of building projects were speeded up so that the developers would be assured of the two-decade break. A number of Colombian investors had ties with Mireya Moscoso and members of her entourage and are not similarly linked with the Torrijos administration. Some investors in the U.S. are for various psychological and political reasons reacting to their country's international political isolation by cutting back on investments abroad. And then there are the effects of the Torrijos administration's tax increase.