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### Viewing cable 09PANAMA539, SACYR WINS CANAL CONTRACT, SIGNALING BROADER

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
09PANAMA539 | 2009-07-08 19:07 | 2010-12-18 12:12 | CONFIDENTIAL | Embassy Panama

`

    VZCZCXYZ0000
    OO RUEHWEB

    DE RUEHZP #0539 1891920
    ZNY CCCCC ZZH
    O 081920Z JUL 09
    FM AMEMBASSY PANAMA
    TO RUEHC/SECSTATE WASHDC IMMEDIATE 3561
    INFO RUEHMD/AMEMBASSY MADRID IMMEDIATE 0337
    RUCPDOC/DEPT OF COMMERCE WASHDC IMMEDIATE
    RULSDMK/DEPT OF TRANSPORTATION WASHDC IMMEDIATE
    RUEATRS/DEPT OF TREASURY WASHDC IMMEDIATE
    RUMIAAA/HQ USSOUTHCOM MIAMI FL IMMEDIATE
    RHEHAAA/NSC WASHDC IMMEDIATE
    RHEHAAA/WHITE HOUSE WASHDC IMMEDIATE

` `

    C O N F I D E N T I A L PANAMA 000539

    SIPDIS

    E.O. 12958: DECL: 07/09/2019
    TAGS: ECON ETRD EWWT PGOV PM PREL
    SUBJECT: SACYR WINS CANAL CONTRACT, SIGNALING BROADER
    SPANISH INFLUENCE

    REF: A. PANAMA 508
    ¶B. PANAMA 519

    Classified By: AMBASSADOR BARBARA J. STEPHENSON FOR REASONS 1.4 (b) & (
    d)

    ¶1. (C) In an elaborate ceremony attended by President
    Martinelli and most of the Cabinet, the Panama Canal
    Authority (ACP) announced that the consortium led by Spanish
    firm Sacyr had won the $3.2 billion contract to build the
    third set of locks, centerpiece of the once-in-a-century
    Canal Expansion project. This award marks an increased tide
    of Spanish influence in Panama. President Torrijos had
    established very close ties with the Spanish Royals,
    attending a ceremony in Madrid in his honor during
    devastating floods last November, during which Spain
    announced a gift of two helos to Panama. The Spanish
    government also established a regional crisis response center
    in Panama. In early June, President Martinelli visited the
    King of Spain, and the Spanish delegation at President
    Martinelli's inauguration, led by Prince Felipe, was very
    well received (ref A). We strongly suspect that the
    financially troubled Sacyr was able to offer a surprisingly
    low price due to backing from the Spanish government.

    ¶2. (C) Sacyr's win over consortia led by Bechtel and ACS
    (also from Spain) complicates our bilateral relationship on
    both political and economic levels. On the political level,
    the award casts an unwelcome spotlight on the Aleman family.
    Alberto Aleman Zubieta, the ACP Administrator, formerly
    served as General Manager of CUSA, Panama's largest
    construction company and a junior member of the Sacyr
    consortium. In the mid-1990's Alberto Aleman's cousin,
    Rogelio Aleman, succeeded him as the GM of CUSA (with Alberto
    reportedly selling his shares in the firm). Cousin Jaime
    Aleman, who provides legal representation to the winning
    consortium, is Martinelli's Ambassador-designate to the
    United States. In addition, Alberto's sister, Vicky, is
    the wife of a founding partner of Jaime's law firm.

    ¶3. (C ) As expected, Sacyr offered the lowest price, $3.2
    billion, versus $4.3 billion for Bechtel and nearly $6.0
    billion for ACS. A Bechtel representative noted that the
    concrete cannot even be poured at Sacyr's price, and that
    ACS' price indicated that they did not want to win. More
    shocking was Sacyr's commanding win in technical points -
    4089, versus 3790 for Bechtel and 3974 for ACS. An earlier
    press leak by a member of the Sacyr consortium that it had
    achieved the highest technical score (ref B) - despite
    expectations to the contrary - could cause Bechtel to
    question the confidentiality of the process. A
    representative of Bechtel's partner, Mitsubishi, told
    Ambassador that they would fight the award. Embassy will
    consult with Bechtel and further report on the award of this
    contract and next steps.
    STEPHENSON

`