PANAMA voted yesterday in a referendum backing an ambitious €4.2 billion expansion plan to give its famous canal its biggest face-lift in a move the government hopes will lift the nation out of poverty.

Construction workers, teachers and health workers were among thousands who went on strike yesterday in Panama, saying they wouldn’t return to work until the government withdrew a proposal to increase the retirement age.

Martin Torrijos, the son of a former dictator, won Panama’s first presidential elections since the handover of the Panama Canal and withdrawal of US troops in December 1999, electoral authorities said.