Free Trade and International Peacemaking
By David McKay Wilson
As deputy minister of foreign relations for the Republic of Panama, Francisco Alvarez De Soto, J.D. ’94, is fulfilling his dream of serving his home country and leading Panama in the 21st century.
As a first-year law student, Francisco Alvarez De Soto, J.D. ’94, recalls visiting the United Nations with the International Law Society and dreaming that someday he’d address the General Assembly on behalf of his homeland.
Nineteen years later, that reverie became reality, just two weeks after he was named the Republic of Panama’s deputy foreign minister. In September 2011, he spoke from the General Assembly’s green marble podium on the value of international mediation and the inspiration the UN provided in Panama’s bid for sovereignty over the Panama Canal in the 1970s.
“The struggle of Panama to regain full sovereignty of its territory dates back to 1903,” says Alvarez De Soto, 42, who lives in Panama City. “Our relationship with the United States has had its ups and downs. It was critical for us to obtain the full support of the international community, and that helped us with the dynamics of U.S. politics.”
Alvarez De Soto’s address to the United Nations launched an ambitious year of diplomacy, as he met with leaders around the world to develop bilateral and multi-lateral agreements to benefit his nation.
In March, he was in Tokyo, conferring with Japanese political and trade officials, as well as business leaders. In April, he traveled to the Republic of South Africa on the first official Panamanian visit since diplomatic relations were established in 1995.
“Our natural region to play a major role in is Central America, but in our foreign policy, we want to look outside the usual box,” says Alvarez De Soto. “To continue our growth, we need to look at international markets, and assume our responsibilities as an international trade hub.”
Alvarez De Soto, the son of Spanish immigrants, lived in Panama for the first eight years of his life before returning to Spain. He arrived in New Orleans in the mid-1980s to attend Tulane University, where he majored in political economy. With his sights set on a career in civil law, he only sought acceptance at his top choice: Loyola University New Orleans College of Law.
Alvarez De Soto’s rise in the Panamanian government dates back to 1996, just two years after graduating from Loyola, when he joined a team of young lawyers and economists that managed the nation’s membership in the World Trade Organization. His success there led to his appointment as a negotiator on Panama’s International Trade Council in 1998. By 2001, he was special ambassador for international trade affairs. The next year, he joined the Ministry of Foreign Affairs as ambassador and general director of international economic relations.
In 2003, he opened a private legal practice, Alvarez De Soto & Espinosa Jimenez, and later served as legal affairs vice president of Cable & Wireless Panama, the nation’s largest telecommunications company.
He returned to public service in 2009 as Panama’s deputy minister of international trade negotiations. Two years later, he was named to his current post—deputy minister of foreign relations.
The country, with a population of 3.5 million and an area slightly larger than West Virginia, has emerged as an economic powerhouse in Central America. Its economy grew by 10.6 percent in 2011, the second consecutive year of double-digit growth, says Alvarez De Soto.
“People make a mistake if they look at us just in terms of population and land area,” he says. “We should be analyzed more like a nation like Singapore. We are the engine for economic trade for the entire region of Central America and the Caribbean.”
The nation’s trade focuses on the Canal, that 51-mile-long waterway opened in 1914 that snakes its way across the Isthmus of Panama, which separates the Atlantic from the Pacific oceans. In 2011, an estimated six to eight percent of world trade went through the Canal.
The current lock system can handle what’s called the Panamax class of cargo ships, which were built to fit the Canal’s current dimensions. Up to 14 percent of world trade could be shipped through the Canal in 2014, when its Third Lock Lane Project is completed. That will allow ships 25 percent longer and 26 percent deeper below the surface to make it across the Isthmus.
“It will make a huge difference,” says Alvarez De Soto. “Vessels carrying liquid natural gas and oil are often too large and can’t fit through the Canal and have to go around the Cape of Good Hope. The project will make maritime trade cheaper, and make Panama more competitive.”
Since returning to the government in 2009, Alvarez De Soto has been deeply involved in developing trade agreements with Panama’s trading partners. In 2007, Panama and the U.S. signed the U.S.-Panama Trade Promotion Agreement, which will eliminate tariffs and other barriers to U.S. exports. The U.S. Senate finally ratified the accord in 2011, and Alvarez De Soto says details are still being worked out on the pact’s implementation.
A strong proponent of free trade, Alvarez De Soto says opening up world markets helps generates economic health for both importers and exporters.
“Free trade facilitates the movement of capital, and the exchange of capital builds wealth,” he says.
Alvarez De Soto headed up the Central American delegation in March 2011 at trade talks with the European Free Trade Association—the nations of Norway, Switzerland, Lichtenstein, and Iceland.
Alvarez De Soto has been deeply involved in negotiations over a free-trade agreement with neighboring Colombia, which ruled Panama until its independence in 1903. Alvarez De Soto was a key player in the fifth round of talks on the agreement, which ended in 2011 without resolution. The sixth round has just commenced, with Alvarez De Soto confident that disagreements over agricultural products will be resolved.
“I hope the sixth round will be the last,” he says.
Alvarez De Soto’s success in the trade arena taught him the value of international cooperation on the economic front. Now he’s looking to create more cross-border collaboration on a broader range of economic, political, and security issues.
The Republic of Panama has donated land and will finance the construction of a regional center in Panama to serve as headquarters for 16 UN agencies operating in Central America.
“In international politics, we’d like to be known as the Geneva of Latin America,” says Alvarez De Soto.
That philosophy was detailed in his address to the United Nations in September, as he advocated for strengthening the role of mediation in the peaceful settlement of international disputes and preventing conflict before it breaks out into bloodshed.
He recalled the role played by the UN in the 1970s, when Panamanian nationalists vowed to wrest sovereignty of the Canal from the United States. Of particular inspiration, Alvarez De Soto told the General Assembly, was its passage of Resolution 31/143 in 1976, which involved implementation of the 1960 UN declaration on granting independence to colonial countries and peoples. The United States voted against it.
The resolution ostensibly addressed the Union of South Africa’s illegal occupation of Namibia, and white-minority rule in Zimbabwe. But it also reaffirmed the international community’s determination to eradicate colonialism from the world stage. Alvarez De Soto told the General Assembly that the resolution inspired the bilateral agreement signed a year later, which resulted in turning over the Canal to Panama in 1999.
“Nowadays, the Panama Canal, fully under our sovereign authority, is one of the most important axes of our economic development, supervised by Panamanian administration, for the benefit of all nations,” he said that day. “For this noble success of multi-lateralism, Panamanians will always be grateful to the United Nations.”
David McKay Wilson is a freelance writer who has written extensively for college and university magazines.
View the complete spring 2012 issue of Loyola Lawyer.