Panama Decentralization After Méndez: What Comes Next

PANAMA · WHAT HAPPENS NEXT

Panama decentralization after Méndez depends on one choice by President José Raúl Mulino: who runs the agency. Roxana Méndez offered her post to him on Thursday 15 October, and she stays until a successor is designated.

For US readers, the agency moves public dollars, so its direction touches property owners, contractors and Panama’s anti-corruption record. The resignation is reported in Panama’s Roxana Méndez Resigns on 15 October, and the agency’s rules are explained in Panama’s Decentralization Authority Explained.

This piece covers what comes next: who can succeed her, what the Assembly and the government decide, and what it means for municipalities. No successor had been named by Friday 16 October, according to the agency’s website and local reports.

How a Successor Is Chosen

Under Law 66 of 2015, the president appoints the director and a deputy for five years. A candidate needs a university degree, five years of proven municipal experience and no conviction for common crimes or against public administration.

The same law requires ratification by the National Assembly. Mi Diario reports that the plenary confirmed Méndez on 11 October 2024, and TVN says Mulino named her on 19 June 2024 while still president-elect.

The deputy director replaces the director during temporary absences, under the same law. Whether that post is filled today, and by whom, is not stated in the sources reviewed.

What the Mulino Government Has Said and Done

La Prensa quoted Mulino on 7 May calling parallel decentralisation a disaster that squandered about US$320 million from 2021 to 2024. The term covers transfers made outside the legal formulas under former president Laurentino Cortizo, and each case remains unproven.

La Prensa reported on 9 August that prosecutors were analysing 72 audit reports and that 99 people had been charged with embezzlement. That is separate from the 353 complaints the AND filed, a count Méndez gave the Assembly in September.

On Thursday 15 October, the Superior Court of Appeals ordered provisional detention for eight former Belisario Porras community-board staff accused of embezzling about US$8 million, La Prensa reported. The case began with an AND complaint, prosecutors have charged 15 people in it, and the accused are presumed innocent.

Official figures reported by La Prensa in March show US$1.107 billion of property tax collected since 2021 and US$618 million transferred. Mayor Mayer Mizrachi of Panama City used those numbers to argue that the central government was keeping money owed to municipalities.

What the Assembly Decides

The Assembly’s Budget Committee is also reviewing the 2027 state budget, which Economy Minister Felipe Chapman put at US$35.111 billion on 29 July. The AND’s own recommended share is US$296.4 million, including US$182 million of property tax that passes to municipalities in full.

The committee has since approved, by nine votes, a resolution asking the Economy Ministry to reformulate the draft and add US$199.1 million, La Prensa reported on 16 October. Committee chair Eduardo Vásquez had told TVN on 7 October that the hearings were marked by political differences and poor attendance.

On 7 May, Benicio Robinson, who leads the Democratic Revolutionary Party (PRD), accused Méndez of persecuting its mayors. She answered that she regretted his reaction to the complaints, and the committee approved a US$30 million transfer that day.

What Panama Decentralization After Méndez Means for Municipal Transfers

The formulas are in Law 66, so a change of director does not alter what each municipality is owed. Half of each district’s property tax returns to it, and smaller districts are topped up to at least US$500,000.

The practical risk is timing, because mayors say the state has paid late and in part. Mayors and local representatives claimed more than US$500 million of unpaid property-tax transfers, La Prensa reported on 9 August.

The US$30 million approved on 7 May covers part of that debt, with US$17 million going to Panama district, La Prensa said. San Miguelito follows with almost US$2 million, and more than 20 of the biggest tax-raising districts receive funds.

The AND says its 2027 plan puts the full property-tax estimate of US$182 million inside the state budget for the first time in five years. A new director inherits that promise and the digital approvals that the agency says cut approval times by 60%.

What It Means for You

Panama prices public budgets in US dollars, so these figures read directly for investors, contractors and property owners. Property-tax payments in a district feed that district’s works, and the AND publishes approved projects and payment status online.

A new director matters most for speed: how fast projects are approved, audits are requested and complaints are pursued. Residents should check their district’s project list before counting on promised works.

For background on the country, see Panama Explained: The Canal, the Economy, the Politics and What to Watch. For the capital, see the Panama City City Guide for Expats and Visitors.

What to Watch Next

First, who Mulino names and whether the Assembly ratifies the choice quickly. The AND said Méndez stays in post until then, so the timetable is the government’s to set.

Second, the final vote on the 2027 budget, which fixes the US$296.4 million recommended for the AND. Third, whether the Comptroller General’s audits and prosecutors’ cases keep the same pace under new leadership.

Fourth, the unpaid property-tax balance that mayors put above US$500 million. Local reports will show whether payments follow the US$30 million transfer approved in May.

What Is Not Known

Nobody has named a successor, and the AND has published no timetable or reason for Méndez’s exit. TVN wrote that its own information points to personal reasons, which the agency has not confirmed.

We have not found a report of the final Assembly vote on the 2027 budget, and the August prosecution figures may have changed. Anyone named in the cases is presumed innocent, and later amendments to the 2015 law were not checked.

Panama is also recovering from the magnitude 7.5 earthquake of 9 October, and the committee’s request includes investment for the affected Azuero region, La Prensa reports. We have not confirmed whether the AND will manage any reconstruction transfers.

Frequently Asked Questions

Who will replace Roxana Méndez at the AND?

No successor had been named by Friday 16 October. Méndez stays in post until the president designates a replacement, the agency said.

Does the Assembly vote on the new director?

Under Law 66 of 2015, the director must be ratified by the National Assembly. The president makes the appointment, and the plenary confirmed Méndez in October 2024, Mi Diario reports.

Will municipalities still receive their property-tax money?

The formulas sit in law, so a new director does not change what each district is owed. Timing is the risk, since mayors say payments have been late and incomplete.

What is parallel decentralisation?

It is the name for transfers made outside the legal formulas under former president Laurentino Cortizo. Each case remains an allegation until a court rules.

When is the 2027 budget approved?

The government presented the US$35.111 billion budget to the Assembly on 29 July, and the Budget Committee has asked for US$199.1 million more, La Prensa reported on 16 October. We have not found a report of the final vote.

Sources: AND communiqué of 15 October; AND release of 24 September; Law 66 of 2015; La Prensa Panamá (15 October); La Prensa (9 August); La Prensa (20 May); La Prensa (7 May); La Prensa (25 March); TVN on the resignation; TVN on the budget hearings; La Estrella on the 2027 budget; La Prensa (16 October); La Prensa (15 October, Belisario Porras); Mi Diario.

This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief

The Rio Times · Power Map

See who really holds power in Latin America

Click to open the Power Map →