The Flow Goes On

On a routine coastal patrol last week, Panamanian police noticed two dozen shrimp boats clustered near the island of Cebaco, on the Pacific coast. Suspicious, officers boarded one of the craft and discovered two packages containing 15 kg of cocaine. For Nestor Castillo, police chief of Veraguas province, it was a distressingly familiar episode. "In the past year we are getting flooded with cocaine processed in Colombia," he says. "More than ever before."

Panama, with 1,550 miles of scalloped Atlantic and Pacific coastline, remains a major transshipment point for cocaine moving from South America to the U.S. and Europe. A July...

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