Panama leader's deputy-turned-rival wins presidency

PANAMA CITY - Panama's vice-president, running as an opposition candidate, won the country's presidential election on Sunday after a campaign in which he took credit for outgoing leader Ricardo Martinelli's policies but promised a cleaner government.

Juan Carlos Varela of the centre-right Panamenista Party (PP) helped Martinelli get elected as president in 2009 but later fell out with him. He has vowed to cut the cost of living, reduce poverty and tackle corruption.

Panama's election tribunal pronounced Varela the winner after he secured almost 40 per cent of the vote with more than 60 per cent of votes counted.

He had a comfortable lead over his two main rivals, ruling party candidate Jose Domingo Arias and left-leaning former Panama City mayor Juan Carlos Navarro of the Democratic Revolutionary Party (PRD).

"Today Panama wins, today our democracy wins," Varela said in a phone call with the head of the election tribunal which was broadcast live.

Varela inherits oversight of a major expansion of the Panama Canal, which briefly stalled earlier this year after a row over costs between the canal and the building consortium.