All Material Copyright by Latin America Data Base. 
Latin America Data Base News Items [PeaceNet]
June 1986 -- February 1987


June 1986

CONFLICT OVER STAFFING OF PANAMA CANAL MANAGEMENT POSITIONS CONTINUES

On June 9, members of the Panama Canal Zone Managing Board 
discussed the possibility of increasing Panamanian participation on 
the board. At present, the board consists of nine persons, five from 
the United States, the remainder Panamanians. The Canal agreement 
between the U.S. and Panama in effect since October 1, 1979, 
provides for the compulsory placement of Panamanians in key 
positions in order for that country to gain complete control of Canal 
operations by the year 2000. 
 
At the present time, 82.5% of all Canal employees are Panamanian; 
however, most are not positions of authority or responsibility for 
canal maintenance. Local officials argue that Panamanians with 
adequate technical knowledge to operate the Canal are available. 
Moreover, the technology employed in Canal operations is relatively 
simple; the canal was constructed in 1914. According to the current 
agreement, the United States is responsible for canal maintenance 
until December 25, 1999. At that time, all canal facilities must be 
transferred to the Panamanian government in "perfect condition." In 
recent statements, President Eric Arturo del Valle said Panamanians 
are uneasy about privileges granted to U.S. nationals employed in 
Canal activities, but denied to local workers. 
 
PANAMANIAN GOVERNMENT CREATES COMMISSION TO "FORMULATE STRATEGY" 
   ON RECEIVING CANAL FACILITIES IN YEAR 2000 

On June 25, Panamanian President Eric Arturo Delvalle met with his 
cabinet ministers to analyze recent statements by US Sen. Jesse 
Helms suggesting that Washington may not fulfill treaty obligations 
pertinent to Panamanian sovereignty over the 50-mile Canal 
facilities. During the administration of President James Carter, the 
US signed treaties with the Omar Torrijos administration in Panama 
which guaranteed Panamanian control of the Canal and seven US 
military installations, effective December 31, 1999. Delvalle and 
his ministers agreed to create a commission to "formulate strategy" 
towards defending Panama's claim to the Canal. 
 
According to a recent government report, Sen. Helms' remarks were 
interpreted as damaging to future Panamanian sovereignty over the 
Canal and related installations. June 30: In a statement to local 
newspaper REPUBLICA, Pedro Brin Martinez, chair of the Panamanian 
parliament's foreign affairs commission, said the House vote on June 
25 is tantamount to a declaration of war against Central America. 
Brin Martinez claimed that the US Congress and the State 
Department must abandon violence if they wish to avoid a new 
Vietnam. He stated that the only way to resolve the regional conflict 
is through negotiations. --At the request of the Nicaraguan 
government, the UN Security Council opened debate July 1 on US 
aggression against that country. Earlier, foreign ministers of the 
Contadora Group-- Mexico, Panama, Colombia and Venezuela--and a 
majority of UN member nations denounced the House decision to 
escalate the war in Central America. 
 
CASTRO ADDRESSES RECENT NEGATIVE PUBLICITY ABOUT PANAMANIAN MILITARY LEADER 

In a June 30 interview with Panamanian journalist Norma Nunez, 
Cuban President Fidel Castro charged that recent publicity 
surrounding the alleged illegal activities of Gen. Manuel Noriega was 
engineered by the US State Department, Pentagon, White House and 
Central Intelligence Agency. Castro's source was reportedly a US 
National Security Council member. He then stated the "anti-Panama 
campaign" was based on "alleged facts" in an attempt to cause 
important changes in that nation's domestic and foreign policy. 
According to President Castro, many conservatives in the United 
States are concerned about changes in US strategic interests 
resulting from the implementation of the Canal agreements. Any 
disruption of Panamanian political stability, he said, will be used as 
an argument for the US to renege on the agreements ratified in 1977 
during the administrations of Gen. Omar Torrijos and James Carter. 
The US campaign against Panama was described as a "dirty war."
 
Next, Castro denied that armed forces chief Gen. Manuel Antonio 
Noriega had ever passed intelligence information to Cuba. He said 
the intent of this charge published in the NEW YORK TIMES and other 
US media sources was to cause a rift between Panama and Cuba. 
Moreover, the Cuban president said he simply did not believe Noriega 
would disclose information on Cuba to the United States. He pointed 
out that relations with the Panamanian government, including Gen. 
Noriega, had been very positive since the administration of former 
president Omar Torrijos. As a case in point of Noriega's good will 
to Cuba he pointed out that a critical moment during the US invasion 
of Grenada, the general attempted to arrange a ceasefire and prevent 
bloodshed. 
 
In reference to accusations by US Sen. Jesse Helms to the effect 
that Noriega participated in the alleged murder of ex-President 
Torrijos, Castro said, "That is even more outrageous...[to] those of 
us who know of Noriega's loyalty to Torrijos."
 
The Cuban president then pointed out that the United States had used 
similar "defamation" tactics against Mexico, exemplified by Sen. 
Helms' "slanderous and dirty" accusations against President Miguel 
de la Madrid. He said that for about 15 days Mexico and Panama were 
targets of "blatant, bare-faced intervention" by the United States.
 
The Cuban president stated that the Panamanian military remains 
unified. He warned that if the US manages to destabilize the country 
by causing splits in the National Guard and between the Guard and 
the populace, the Canal will not revert to Panama in the year 2000.
 
Castro did not rule out the possibility of Noriega becoming the 
target of assassination attempts. 
 
The interview was broadcast on Panamanian television and radio, 
with the exceptions of Channel 4, and National Radio. 

July 1986
 
PANAMA'S RULING PARTY JOINS SOCIALIST INTERNATIONAL 

On July 3, General Secretary Carlos Ozores of Panama's ruling 
Democratic Revolutionary Party (PRD) announced that the PRD has 
decided to join the Socialist International as a "consultative 
member." Party members of the SI in this capacity do not exercise 
voting rights, but participate in meetings and all deliberations of 
the international organization.
 
A Panamanian delegation consisting of Ozores, Foreign Relations 
Secretary Nils Castro and trade union leader Pablo Arosemena, 
attended the 17th SI world congress in Lima, Peru, which took place 
in late June. The SI congress approved a resolution supporting US 
compliance with the Canal treaties established during the 
administrations of the late Gen. Omar Torrijos, and former US 
President Jimmy Carter. If treaty provisions are realized, Canal 
facilities and seven US military bases in the area would revert to 
Panamanian control in the year 2000. 
 
GENERAL NORIEGA ADDRESSES RALLY: 
  PANAMA WILL STAND FIRM AGAINST US SLANDER CAMPAIGN 

Speaking before a rally July 4 at Defense Headquarters in Panama 
City, Gen. Manuel Noriega said the country's armed forces will never 
lower the Panamanian flag from Ancon Hill. Noriega told the 
thousands of transport workers and union leaders, "We are 
committed to a struggle which will not end until we have achieved 
full sovereignty over the Canal." In reference to US media reports in 
mid-June of the General's alleged corruption and illegal activities, 
Noriega said, "The US- orchestrated campaign against this country is 
damaging our youth, the people's dignity and the generation who 
contributed to giving Panama its own identity."
 
"We are inheritors of the achievements that [the late Gen. Omar] 
Torrijos obtained with firmness and patriotism. This heritage is 
sacred and we will protect it from any kind of slander or 
conspiracy," he added.
 
Noriega then stated that the future belongs to a specifically 
Panamanian democracy "which does not need to copy" foreign models. 
 
PANAMA DENIED PAYMENT OF $54 MILLION IN CANAL PROFITS 

US representatives on the Panama Canal Commission executive body 
have rejected the Panamanian government's request for payment of 
$54.3 million derived from Canal profits. In comments to daily 
newspaper LA PRENSA on July 12, Deputy Carlos Ozores said the US 
representatives were "completely barefaced when they say they owe 
nothing to the National Treasury." The deputy's statements followed 
the conclusion of a two-day meeting by the executive.
 
On July 9, Panamanian Foreign Jorge Abadia announced that his 
government had presented a formal request to Washington 
concerning payments of Canal profits. 
 
According to Ozores, Panamanian delegates managed to persuade US 
counterparts of another point requested by Panama City. A study 
group will be established to design an effective program for 
increasing the number of Panamanian personnel in executive and 
management posts on the Canal Commission. The program is to be 
presented at the Commission's general meeting in October. 
 
Next, Panamanian delegates insisted that the Commission adjust 
Panama's share of operations and maintenance expenses according to 
the realities of that country's budgetary capacity. In this way, 
Panama's share of Canal expenses would not be "artificially high," 
which effectively prevents the country from receiving a larger share 
of profits. 
 
PANAMA'S RULING PARTY OPPOSES MUTUAL LEGAL AID TREATY PROPOSED BY WASHINGTON 

According to an article on the editorial page in the July 11 edition 
of the daily newspaper LA ESTRELLA, Panama's ruling Democratic 
Revolutionary Party (PRD) rejects the Mutual Legal Aid treaty 
proposed by the United States. PRD spokespersons have stated that 
acceptance of the treaty would be tantamount to denying Panamanian 
sovereignty and independence. 
 
The editorial stated that since 1978 the US government has been 
pressuring Panama City to sign a bilateral accord which would 
provide Washington with access to Panamanian bank records of both 
state and private institutions.
 
The Reagan administration recently presented a draft treaty which 
according to the PRD would eliminate the country's status as 
international financial center, anonymity of banking accounts, coded 
accounts, the nation's trade coding system, shipping registration, 
and other trade activities. Next, the treaty would provide US 
officials access to banking and trade information, and the means to 
confiscate accounts and goods, without the prior authorization by 
Panamanian authorities.
 
The PRD calls on the government to maintain a "firm position" in 
treaty negotiations, and urges business organizations to form a 
national united front to defend Panamanian sovereignty. 
 

PANAMANIAN PRESIDENT ANNOUNCES CAMPAIGN TO INFORM FOREIGN AND NATIONAL 
  PUBLIC OPINION ON INTERPRETATION OF CANAL TREATY  7/18/86 

Panamanian President Eric Arturo del Valle announced July 15 the 
beginning of a national and foreign campaign to demonstrate the 
"correct interpretation" of the Torrijos-Carter treaties pertaining 
to the Canal Zone. According to the Canal treaty authored by the 
administration of US President James Carter and the late Gen. Omar 
Torrijos of Panama, the 50-mile waterway and military 
installations in the Canal Zone would come under Panamanian control 
in the year 2000.
 
President del Valle's announcement followed the presentation of a 
detailed report to the Cabinet by Oyden Ortega on the July 9-10 
meeting of the joint US-Panama Canal Commission executive board. 
Ortega is a member of the Canal Commission. 

August 1986
 
CHINESE OFFICIALS EXPRESS INTEREST IN EXPANDING RELATIONS WITH PANAMA 

On Aug. 4, Chinese Prime Minister Zhao Ziyang and National Assembly 
Chairman Peng Zhen, called for expanding relations with Panama. 
Ziyang and Zhen announced their interest during a meeting with a 
Panamanian legislative delegation in Peking. The Panamanian 
delegation is headed by national assembly chairman Camilo Gozaine. 
 
Ziyang praised Panama's independent and non-aligned policy and its 
position favoring the peaceful settlement of the Central American 
conflict without foreign intervention. Regarding bilateral 
relations, he said many possibilities exist for trade expansion. 
 
PANAMA: DEMONSTRATION IN CAPITAL CITY DEMANDS US ADHERENCE TO CANAL TREATIES 

On August 12, thousands from throughout the country demonstrated 
in Panama City for "sovereignty of the Panama Canal." Military 
troops under the direction of Gen. Manuel Noriega, also participated 
in the demonstration.
 
The demonstrators' major slogan--"The Canal Treaty in the Year 
2000"--referred to the 1977 treaties between the governments of 
former US President James Carter and Gen. Omar Torrijos. 
Accordingly, the Panama Canal and related facilities, including US 
military installations, will revert to Panamanian control on 
December 31, 1999.
 
In the past four months, Panamanian politicians and members of the 
armed forces have expressed concern over US reluctance to abide by 
obligations contained in the treaties. Indicative of such concerns 
are Panamanian complaints that nationals are underrepresented in 
Canal facility executive, managerial and technical positions. 
 
Next, in mid-June a major expose of Panama's military strongman, 
Gen. Manuel Noriega, appeared in the US media. Charges against him 
included arms and drug trafficking, murder of a political opponent, 
and espionage for the US as well as Cuba, all with the complicity of 
the civilian government. Since then, most Panamanian political 
parties, civic organizations and elements of the armed forces have 
"closed ranks" around Noriega, in an effort to repel what is 
interpreted as US attempts to undermine the government of 
President Eric Arturo Delvalle. Some feared that the US and local 
parties representing the "oligarchy" and social sectors opposed to 
policies established by the late Gen. Torrijos, were organizing a 
military coup.  
 
PANAMANIAN LEGISLATORS SUPPORT RESUMPTION OF RELATIONS 
  WITH PEOPLES REPUBLIC OF CHINA 

According to local media reports on August 9, Panamanian 
legislators are exploring the resumption of relations with the 
Peoples Republic of China. Camilo Gozaine, chairman of the 
legislative assembly, is currently visiting China. 
 
Raul Montenegro, of the ruling Democratic Revolutionary Party (PRD), 
said that Panama should "develop relations with whomever it 
wants." He added, "We cannot ignore the role played by the Peoples 
Republic of China, the country with the largest population in the 
world."
 
Montenegro noted that China has historically supported Panamanian 
aspirations for independence, as clearly stated in UN Security 
Council meetings. 
 
INTERNATIONAL PEACE GROUP CONDEMNS US PRESSURE ON PANAMA AND MEXICO 

In an Aug. 19 statement issued from its office in Panama City, the 
International Network for Peace in Central America condemned US 
pressure and intimidation of Mexico and Panama. The statement was 
signed by the Network's Central American coordinator, Dalys Vargas. 
The statement claimed US pressure is motivated by an attempt to 
persuade the two nations into an alliance with Washington's Central 
American policy. Both Panama and Mexico are key members of the 
Contadora Group. Along with Colombia and Venezuela, the 
governments of the two countries have been actively seeking a 
negotiated solution to the conflict in Central America since 1983. 
Next, according to the statement, the Reagan administration is 
manipulating international public opinion via sending troops to 
Bolivia to destroy the drug traffic system, and its recent 
intervention in Chile with the stated objective of promoting 
democracy and human rights. The Network said these actions are 
mechanisms to pressure Latin American nations into accepting 
armed US intervention in Nicaragua. 
 
PANAMANIAN MEDIA, SALVADORAN REBELS REPORT ON HONDURAN AND SALVADORAN 
  MILITARY INVOLVEMENT IN WEAPONS CONTRABAND FOR CONTRAS 

According to an Aug. 18 report by rebel station RADIO VENCEREMOS, 
Honduran and Salvadoran army personnel under Salvadoran army 
chief of staff Gen. Adolfo Blandon are cooperating in transporting 
material aid to the Nicaraguan contras based in Honduras. Transport 
planes are being provided by the CIA. The rebel broadcast also 
mentioned the seizure on April 29 of a ship carrying weapons 
destined for the contras by the Panamanian navy under orders by Gen. 
Manuel Noriega. The ship was bound for the Salvadoran port of 
Acajutla. On the following day, both US allies forwarded a formal 
protest to the Panamanian government. According to an Aug. 18 
report by the official Panamanian newspaper HOY, the ship in 
question was the Danish "Pia Vesta," and that the weapons were to 
be received by the Salvadoran military and the contra armies. 
Another Panamanian newspaper, LA REPUBLICA, said that the 
Honduran government participated in the operation, serving as a go-
between for the CIA and the smugglers; the latter purchased the 
weapons in East Germany with the use of fake documents. LA 
REPUBLICA also reported that parties involved in the operation 
commandeered by US arms smuggler David Duncan, attempted to 
implicate the Peruvian government by stating the cargo was 
destined for that country's El Callao port. The Pia Vesta never 
docked at the Peruvian port. When the ship changed course, the 
Peruvian government informed the Panamanians of the ship's 
"suspicious behavior," said LA REPUBLICA. The Peruvian 
Foreign Ministry also reportedly requested information from the 
Washington regarding Duncan's activities. Next, the newspaper 
claimed Duncan accepted an agreement with the Honduran 
government wherein the weapons would be surreptitiously diverted 
to the contras in Honduran territory. The Danish ship was seized by 
the Panamanian navy. The cargo--including 32 trucks, 1,500 rifles 
and 1,440 RPG-18 anti-tank missiles--was confiscated; according 
to Panamanian law, the confiscated material becomes the property 
of the government. 

PANAMANIAN PRESIDENT SAYS NATIONAL TERRITORY WILL NOT BE USED 
  TO TRAIN NICARAGUAN CONTRAS 

At an Aug. 23 museum opening, Panamanian President Eric Arturo del 
Valle told an audience that his government will not permit that 
national territory be used as a training camp for 
counterrevolutionaries attacking Nicaragua. Del Valle spoke at an 
opening of a museum housing pre-Colombian archaeological artifacts 
and jewelry in Penonome City, Cocle province.
 
The president was responding to press reports indicating that the US 
Southern Command, headquartered in the Panama Canal Zone, will 
provide military training to the Nicaraguan contras. 
 
Del Valle said that Panama, as member nation of the Contadora 
Group, and therefore committed to a peaceful resolution to the 
Central American conflict, will not permit national territory to be 
used in training military troops attacking a sister nation. 
 
PANAMA TO CONDEMN US BREACHES OF CANAL TREATIES 
  AT NON-ALIGNED MOVEMENT SUMMIT CONFERENCE 

The Panamanian government this week announced that it will 
condemn the United States for reneging on provisions contained in 
the Panama Canal treaties at the September 7-9 Non-Aligned 
Movement (NAM) summit conference in Harare, Zimbabwe. The 
treaties were signed in 1977 between governments of US President 
Jimmy Carter and Panamanian President Gen. Omar Torrijos.

Panamanian officials also said the Reagan administration will be 
criticized for the slander campaign against that country's military 
and civilian authorities as part of US pressure to continue 
controlling the canal beyond the year 2000.

Heading Panama's delegation to the NAM summit is Vice President 
Roderick Esquivel. He will be accompanied by Deputy Foreign 
Minister Jose Maria Cabrera and Panamanian Ambassador to the 
United Nations Leonard Kam, among others. 

The Canal treaties went into effect on October 1, 1979. Only days 
before the US Congress passed a bill (96-70) known as Murphy's Law, 
which gave American employees in the Canal facilities special 
privileges apparently not enjoyed by Panamanian employees. Some of 
these privileges include access to low-priced gasoline, water and 
housing; the use of diplomatic pouches, and high salaries and 
bonuses.  

U.S. BLAMED FOR DETERIORATION OF PANAMANIAN RAILWAY SYSTEM 

At an Aug. 29 press conference in Panama City, Maj. Fernando 
Quesada, director of Panama's transcoastal railway, said the United 
States is responsible for the precarious condition of the railway. 
The US Southern Command, headquartered in the Panama Canal zone, 
issued a decree recently prohibiting US military personnel from 
using the railway because it was a safety hazard.

Quesada told reporters that the railway was turned over to the 
Panamanian government in a poor state of repair after the 1977 
Canal treaties between the two governments went into effect in 
1979. He said the US contributed to the deterioration of the railway 
since "not even one cent" was spent to maintain it for years prior to 
the signing of the Canal treaties. The railway director declared that 
it was "regrettable" US soldiers have joined in the campaign against 
Panama, the sole purpose of which is to renege on the treaties which 
state that the Canal and all related facilities will become 
Panamanian property in the year 2000. He said that when the 
treaties were signed, Washington did not "put all its cards on the 
table," in reference to the failure to discuss a report on railway 
conditions drafted in 1976.

According to Quesada, rehabilitation of the railway, including the 
main trunk line linking Panama City on the Pacific side to Colon on 
the Atlantic, will require up to $50 million. He pointed out that 
the railway is part of the Canal's facilities, and necessary to 
operating the waterway. 

The major said, "We believe that instead of trying to escape their 
responsibilities, the North Americans should contribute to resolving 
the problems they have created in the railway system by delivering 
it [to the government] in operational condition." 

September 1986

LEADER OF PANAMANIAN RULING PARTY SAYS TORRIJISTA FOREIGN POLICY 
  MUST BE REAFFIRMED AT NON-ALIGNED MOVEMENT SUMMIT 

Leader of Panama's ruling Democratic Revolutionary Party, Alberto 
Lopez Tirona, told reporters in Panama City on Sept. 2 that his 
government must take advantage of the eighth Non- Aligned 
Movement (NAM) summit conference in Harare, Zimbabwe, to 
"reaffirm the international policy" mapped out by the late Gen. Omar 
Torrijos. Lopez said that Panamanian foreign policy should 
strengthen the principles of non-alignment at the NAM summit.

Next, he declared that the Panamanian delegation to the summit must 
"condemn the irregularities in implementing the Torrijos-Carter 
Canal treaties, and particularly the negative effects of Law 96-70." 
The latter, said Lopez Tirona, is a consequence of the unilateral 
interpretation by the United States of the Canal treaties.

Panama's non-aligned policy, he added, has always been clear, 
realistic and consistent in keeping with "our vocation of an 
independent and sovereign country, respecting the principle of non-
interference."

Lopez Tirona recently published an essay titled, "The Historical 
Challenge of Panama's Foreign Policy," in which he states that his 
country is "aware" of the threats to peace that military solutions 
to political conflicts would bring. 

Panama has been an active participant in the Non-Aligned Movement 
since former President Gen. Torrijos attended the fourth summit 
meeting in Algiers in 1973. After Panama was admitted to NAM as a 
full member, Torrijos also attended the fifth summit in Colombo 
(1976), and the sixth summit in Havana, Cuba (1979). 

SALVADORAN GOVERNMENT AND REBEL REPRESENTATIVES MEET IN PANAMA CITY 
  FOR SECOND PRELIMINARY MEETINGS TO PEACE TALKS 

On Sept. 10 Salvadoran media sources announced that Vice President 
and Foreign Minister Rodolfo Castillo Claramount will represent the 
government of Jose Napoleon Duarte at the second preliminary 
discussions before the peace talks. The preliminary meeting will 
take place in Panama City Sept. 12 and will focus on security 
measures and the agenda for the third round of peace talks scheduled 
for Sept. 19 in Sesori, a town located southeast of San Salvador. 


PRESENCE OF US MARINES AND EXPANSION OF AIR BASE FACILITIES 
  CONDEMNED BY PANAMANIAN SOLIDARITY ORGANIZATION 

In a Sept. 10 statement released in Panama City, the National 
Coordinator of Solidarity Organizations (CONASOL) condemned the 
presence of US Marines on the outskirts of Herrera and Veraguas. 
CONASOL said that US Marines, alongwith soldiers of other 
nationalities participating in training exercises on Panamanian 
soil, had also been observed in jungle and (Atlantic) coastal areas 
of Colon province. 

Next, the statement declared that flights of US military transport 
aircraft landing at the Howard air base are increasing. Moreover, 
runways and hangars at the air base are being expanded and 
upgraded, aid CONASOL in preparation for the escalation of the 
conflict in Central America.

Finally, the statement condemned US interference in Central 
America, and particularly, in Nicaragua. 

PANAMANIAN OPPOSITION LEADER SAYS WASHINGTON ATTEMPTING 
TO IMPOSE NEW MILITARY PACT ON PANAMA 

According to Ruben Dario Souza, General Secretary of the Panamanian 
Peoples Party (PPP), the United States is attempting to impose a new 
military pact on Panama as part of the Reagan administration's 
"neoglobalist strategy." Dario told reporters in Panama City Sept. 8 
that an analysis of Washington's foreign policy indicates that 
Panama is a key factor, as site of the US Southern Command.

In Souza's opinion, the Southern Command, located in the Panama 
Canal zone, will be reorganized and equipped in accordance with a 
higher level of autonomy and leadership of several specialized 
forces. The reorganization, he said, will enable rapid deployment of 
US military personnel in Latin America to carry out punitive 
military actions against any country opposing Washington's 
hegemonic dictates and domination.

Souza pointed out that chief of the Southern Command, Gen. John 
Galvin, recently declared that the US possesses forces capable of 
arriving at any point on the continent in defense of US interests to 
defend against dangers arising in "vital areas." The PPP leader 
believes that Panama is the site of Washington's self-appointed role 
as regional policeman. As an example, Souza mentioned the Southern 
Command's assistance to the British in the conflict with Argentina 
over the Malvinas (Falklands) islands. 

PANAMANIANS PROTEST IMF AND WORLD BANK POLICIES 

As reported by Cuban news PRENSA LATINA, on Sept. 11 thousands of 
Panamanians demonstrated in the capital city to protest 
International Monetary Fund (IMF) and World Bank economic policies. 
The demonstration was organized by the National Council of 
Organized Workers (CONATO), and was supported by workers, 
students, and housewives, as well as a number of small business 
owners. Protestors gathered in Porras square, and marched to the 
national legislature building.

CONATO leaders claimed the IMF and the World Bank are pressuring 
the government to make changes in national social security 
legislation which would negatively affect the country's poor, as well 
as elevating the retirement age to 65 years.

CONATO leader Eduardo Rio said Panamanian workers have already 
lost numerous gains realized in past decades. Further sacrifices, he 
said, are unacceptable.

Protestors also condemned the privatization of state companies, the 
two percent reduction of the labor force in the public sector, and 
inadequate economic assistance provided to peasant farmers.  

REGIONAL SOCIALIST INTERNATIONAL MEETING BEGINS IN PANAMA CITY; 
  60 SOCIAL DEMOCRAT PARTIES ATTEND 

On Sept. 20 Carlos Ozores, general secretary of the Revolutionary 
Democratic Party (PRD) confirmed that US violations of the 
Torrijos-Carter Panama Canal treaties will be examined this week 
in a regional meeting of the Socialist International.

Ozores said some 60 representatives of Latin American and European 
Social Democratic parties will meet in Panama on Sept. 24-25 to 
discuss current situations in Central America, Chile, and other 
nations in Latin America.

The PRD leader told Cuban news agency PRENSA LATINA that 
Panamanian delegates intend to include in the final declaration of 
the SI meeting mention of US violations of the Canal treaties and his 
government's hopes that the inter- oceanic waterway will be turned 
over to Panama in the year 2000. 

The regional meeting in Panama was arranged at the June Socialist 
International congress in Peru, when the PRD was admitted as a 
"consultative member" of the organization.

Ozores, a former foreign minister under the government of Aristides 
Royos, expressed satisfaction with the response by members of the 
Non-Aligned Movement at the recent NAM summit in Harare, 
Zimbabwe, to his country's demands. He said Non-Aligned and 
Socialist International support for Panamanian sovereignty over the 
Canal is "bearing extremely positive fruit." 

PANAMANIAN PLANNING AND ECONOMY MINISTER ISSUES CALL FOR REGIONAL UNITY 
  AT ANNUAL IMF-WORLD BANK JOINT MEETINGS 

On Sept. 23 Panamanian Planning and Economy Minister Ricardo 
Vasquez issued a call for a unified Latin American position at the 
upcoming annual joint meetings of the International Monetary Fund 
(IMF) and the World Bank. The meetings will commence late this 
week.

IMF and World Bank governors of Latin America, Spain and the 
Philippines met in Panama City to prepare joint statements for 
presentation at the joint IMF-World Bank annual meeting.

Vasquez told the assembled governors that Latin American nations 
have already undergone great sacrifices, reflected in declining 
economic activities and standards of living, the continued 
deterioration of terms of trade, high unemployment and the 
postponement of socio-economic development goals. He then 
asserted that Latin American and other Third World nations must 
present a unified front before the World Bank and the IMF in order to 
persuade those organizations to contribute to the resolution of the 
foreign debt problem via a refinancing policy, such as the 
commercial banks have adopted.

The minister then issued a plea that small debtor nations receive 
equal treatment vis-a-vis large debtors in terms of economic 
adjustments imposed in return for financial resources.

The assembled representatives from Latin America selected the IMF 
governor from Argentina and the World Bank governor from Ecuador 
to speak on behalf of the region at the upcoming joint session. 


SECRETARY OF STATE SHULTZ DISCUSSES CENTRAL AMERICAN PROBLEM WITH 
  PANAMANIAN PRESIDENT, COLOMBIAN FOREIGN MINISTER
  Update September 26, 1986

On Sept. 23, Secretary of State George Shultz met with several 
political leaders at the United Nations in New York, including 
Panamanian President Eric Arturo del Valle and Colombian Foreign 
Minister Londono, among others. Subsequent to the meeting, a senior 
administration official told reporters that a major topic of 
discussion was the improbability of progress in Contadora 
negotiations as long as the Nicaraguan suit against Costa Rica and 
Honduras is pending before the International Court of Justice at The 
Hague.

The official said he understood that both Costa Rica and Honduras 
will not negotiate with the Nicaraguan government while the suit is 
pending before the World Court.

Next, he said Shultz had complimented President Del Valle on his 
accomplishments during the past year, stating that when nations 
experience an unexpected change of government, there are times 
when a vice president "demonstrates that he has the ability to pull 
the country together and solve problems." Shultz reportedly cited the 
examples of Brazilian President Sarney and former US President Truman.

The Panamanian chief of state informed Shultz on the economic 
problems faced by his country, and asserted that many issues 
regarding the Panama Canal must be discussed with the US 
government. According to the official, a major topic was how the US 
may be of assistance in improving the Panamanian economic 
situation, particularly in terms of job creation. He said Shultz told 
Del Valle that Washington was disposed to work with the 
Panamanian government in efforts to increase the amount of foreign 
investment.

Central America was also a major topic of discussion with both Del 
Valle and the Colombian foreign minister. Shultz reportedly 
reiterated the US position that "Nicaragua is the problem and its 
increasingly totalitarian government not only represses the people 
of Nicaragua, but is a threat to its neighbors." The Secretary also 
noted that the general situation in Central America is improved. 
There is even a "bottoming out" of the economic situation for many 
countries, so that at least "some" economic growth may be expected 
in the future. The official said that once again, the exception to 
the general trend for improvement was Nicaragua, "which is more 
and more isolated in the region and in Europe."

PANAMA CANAL ZONE: EXERCISES FOR EVACUATION OF DEAD AND WOUNDED 
  FROM CENTRAL AMERICA UNDERWAY 

On Sept. 24, units of the US Southern Command based in the Panama 
Canal Zone, commenced training exercises in the evacuation and 
treatment of dead and wounded from Central America. According to 
Cuban news agency PRENSA LATINA, the exercise began at noon. In 
the training exercise, dead and wounded are routed to the US-
maintained Gorgas hospital in the Canal zone.

PANAMANIAN FOREIGN MINISTER SAYS MEETING OF CONTADORA AND 
  SUPPORT GROUP PRESIDENTS POSSIBLE 

At a Sept. 24 press conference in New York, Panamanian Foreign 
Minister Jorge Abadia told reporters that presidents of Contadora 
and Support Group countries may meet before the end of this week to 
discuss the broad outlines of new efforts to revitalize the search 
for a diplomatic solution to the Central American conflict. He 
confirmed that foreign ministers of the eight nations continue to 
discuss the economic, political and strategic conditions currently 
prevailing in Central America.

The Contadora nations include Mexico, Panama, Venezuela and 
Uruguay, while the Support Group consists of Peru, Brazil, Argentina 
and Uruguay.


PANAMANIAN CONGRESSMAN DENOUNCES TRAINING OF NICARAGUAN CONTRAS 
  BY SOUTHERN COMMAND IN CANAL ZONE 

According to Panamanian congressman Luis Navas, Nicaraguan 
contras are being trained on the banks of the Panama Canal in Colon 
province. In a Sept. 26 interview with Cuban news agency PRENSA 
LATINA, Navas said, "We know the Southern Command is training 
several counter-revolutionary contingents at Fort Sherman." The 
congressman is a member of the ruling Democratic Revolutionary 
Party (PRD) from Colon province.

Navas stated that the contras have been training for some three 
months in jungle fighting, and in handling modern weapons supplied 
by the US government. He added that the topography of Fort Sherman, 
located at the Canal's Atlantic outlet, is similar to that of 
Nicaragua's Atlantic coastal region.

According to the politician, residents of Colon province can 
corroborate his statements. Residents have encountered contra 
trainees near the Fort "many times and have even reprimanded them 
for disrespecting local women."

Navas said the presence of Nicaraguan contras violates the Canal 
treaties which specify that the Southern Command can train regular 
forces of other nations, but not irregular troops engaged in 
fighting against a nation with an internationally recognized 
government and which maintains diplomatic relations with Panama.

PANAMANIAN CONGRESS REJECTS U.S. SENATE'S ORDER FOR CIA INVESTIGATION 
  OF DRUG TRAFFICKING BY LOCAL ARMED FORCES 

In the early hours of Sept. 30, the Panamanian national legislative 
assembly concluded a special session with the approval of a 
resolution rejecting a decision by the US Senate that the CIA be 
ordered to investigate drug trafficking within the Panamanian 
Defense Forces (FDP). 

The Senate decision was described as interference in the country's 
domestic affairs, and an attempt to undermine the government's 
decision to settle the Central American conflict via diplomacy. 
Next, the congressional resolution called for repeal of US Law 96-
70, and full observance of Canal treaties by Washington.

PANAMANIAN JUDGE SAYS U.S. LAW 96-70 UNCONSTITUTIONAL; CRITICIZES SENATE 
  ATTEMPTS TO INTERVENE IN DOMESTIC AFFAIRS 

On Sept. 30 former Panamanian Foreign Minister Oyden Ortega told 
reporters that US law 96-70 is unconstitutional, and contradicts 
provisions contained in the Torrijos-Carter Canal treaties. Law 96-
70 reportedly provides Washington with the privilege to unilaterally 
interpret the spirit and letter of the Canal treaties signed by 
Panama and the United States in September 1977.

Ortega, one of four Panamanians on the Canal Commission's 
management group, and a prominent judge, affirmed that no 
legislation by either nation involved (including US law 96-70) can 
nullify the 1977 Canal treaties. Since the US legislation was passed 
only days before Canal treaty provisions became effective, Law 96-
70 has been a major source of friction between the two nations, 
particularly in issues concerned with joint administration of the 
waterway.

According to Ortega, the law is unconstitutional under US 
legislation. If, he said, US congressional leaders insist 
nevertheless on implementing 96-70, the Panamanian government 
may request that it be declared unconstitutional on the basis of 
Panamanian law.

Regarding a recent resolution by the US Senate ordering a CIA 
investigation of possible drug trafficking activities by the 
Panamanian armed forces, Ortega claimed that no foreign 
congressional body can interfere in the internal affairs of another 
state. He added that US politicians apparently have a "distorted" 
understanding of international law as they go about establishing 
commissions and demanding investigations in areas that are strictly 
under the jurisdiction of international organizations. 

October 1986

U.S. FIRM ACCUSED OF VIOLATING PANAMA CANAL TREATIES BY IGNORING 
  LOCAL LABOR LEGISLATION 

The US firm Air Defense Center Federal Credit was accused Oct. 7 of 
ignoring Panamanian labor legislation, in violation of the Torrijos-
Carter Canal treaties. Antonio Reina, secretary general of Local 907 
representing Panamanian workers in the Canal Zone, charged that 
because the company chooses to follow US federal and state 
legislation, local laws have not been observed.

Reina said the company, under contract with the US government, is 
obligated to observe Panamanian law. He added that Foreign Minister 
Jorge Abadia told the Local 907 leadership that a major objective of 
the government is the defense of Panamanian interests vis-a-vis the 
US authorities.

According to Reina, the firm owes Panamanian workers $55,752 for 
unpaid holidays and vacations. These privileges are included in 
local legislation.

In the face of continuing violations of the Canal treaty, the union 
leader called on the Foreign Ministry, the Labor Ministry and the 
Canal Joint Affairs Committee to intervene in the conflict affecting 
Panamanian employees of the US company.

PANAMANIAN ATTORNEY SAYS LATIN AMERICAN NATIONS MUST COOPERATE IN 
  ANTI-DRUG TRAFFIC CAMPAIGN 

In Oct. 8 statements at a conference on drug trafficking in Mexico 
City, Panamanian attorney Carlos Augusto Villales said Latin 
American nations must act in an independent manner in the fight 
against drug trafficking, although cooperation among regional 
governments is also essential to make headway.

Villales noted that the US government should find a way to resolve 
the problem of domestic drug consumption, as it is clear that 
without a lucrative US market, Latin American production would 
cease.

Regarding regional cooperation, he said that legal mechanisms to 
fight trafficking must be internationalized. To this end, the 
creation of a Latin American data bank on anti- drug operations may 
be necessary. 

The Panamanian attorney stated that his government has developed 
draft legislation applied to sanctions against all facets of drug 
trafficking.

Villales and attorneys general from 13 countries were guests of the 
Mexican government for the conference.

PANAMANIAN LEGISLATOR DELIVERS INDICTMENT AGAINST U.S. AMBASSADOR 

During an address before the US Chamber of Commerce in Panama 
City the past weekend, Panamanian legislator Rigoberto Paredes 
accused US Ambassador Arthur Davis of flagrantly and directly 
interfering in Panama's domestic affairs. He said Davis has made 
little effort to even appear diplomatic in the language and style he 
has used in threatening economic sanctions if the Panamanian 
government refuses to accept Washington's policies.

Paredes pertains to the ruling Democratic Revolutionary Party (PRD). 
He criticized the ambassador's crude tactics, adding that his 
government is not "on her knees begging alms," but rather will 
remain on "her feet with her head up," claiming what is rightfully 
hers as a sovereign nation.

According to Paredes, Davis believes he has the right--in the name 
of democracy--to "invade and violate our sovereign territory and 
force us into a halter with a compass pointing to where our orders 
originate."

Specifically, Davis was accused of seeking to "dictate guidelines 
and impose criteria" on Panama's armed forces. This proves, said 
Paredes, that the ambassador is ignorant of the role played by the 
military in Panama's new democracy.

Next, the US ambassador's comments on the use of monies by the 
Panama Canal Commission were regarded as insulting. Paredes said 
Davis's reference to US Law 96-70 as harmless to Panamanian 
interests was obviously erroneous. He also stated that the 
ambassador continues insisting that the Canal Commission promotes 
the increasing participation of Panamanians in canal administration, 
while both the Panamanian Foreign Ministry and national congress 
have produced evidence to the contrary.

Paredes closed his remarks by directing the following remark at 
Davis: "The Canal is ours...its transfer to our control in the year 
2000 is not going to depend on the marks you give us, as if 
Panamanians were frightened school children, and you the teacher 
with a big stick to punish us." (PRENSA LATINA, 10/28/86)

November 1986

PANAMANIAN CABINET TO BE RESHUFFLED 

Rumors of a cabinet reshuffling in Panama will apparently be 
realized this weekend when President Eric Arturo del Valle appoints 
replacements for three ministers who resigned on the evening of 
Nov. 12. 

According to an announcement released by the presidential office, 
Housing Minister Roberto Velazquez, Public Works Minister Efrain 
Zanetti and Health Minister Carlos de Sedas have resigned. 
Unofficial reports in Panama City on Nov. 13 indicated that 
Agricultural Development Minister Bruno Garisto, and several 
directors of autonomous public agencies had also turned in their 
resignations. 

December 1986

PANAMANIAN ARMED FORCES CHIEF DECORATED BY PERUVIAN PRESIDENT 

In a Dec. 18 ceremony in Lima, President Alan Garcia presented the 
Peruvian army's highest distinction--the "Francisco Bolognesi" 
medal--to Panamanian armed forces chief Gen. Manuel Antonio 
Noriega. Noriega was visiting Lima on invitation by the Peruvian 
army high command.

January 1987

JOINT U.S.-PANAMANIAN MILITARY EXERCISES UNDERWAY 

Joint U.S.-Panamanian military exercises with the aim of 
"protecting the Panama Canal" in the event of attack were initiated 
Jan. 12. The maneuvers, called "Candela 87" by the Panamanians and 
"Kindle Liberty" by the Pentagon, began in Chiriqui province, some 
500 km. west of the Canal and bordering on Costa Rica. The 
maneuvers involve ground, naval and air forces.

Panama is contributing 1,894 troops, who are participating in 
tactical operations and strategic exercises. The Pentagon is taking 
part with 4,291 troops from the Canal-based Southern Command, and 
other bases in the United States.

The exercise is scheduled to conclude on Feb. 15.

"Kindle Liberty" maneuvers began on the same day US presidential 
envoy Philip Habib arrived in Panama to meet with Foreign Minister 
Jorge Abadia. Details of Habib's agenda were not available. The 
envoy's visit occurs four days after Contadora and Support Group 
foreign ministers convened with the secretaries general of the 
United Nations and the Organization of American States (OAS) in 
Panama City. The foreign ministers and secretaries general plan to 
meet with Central American leaders in respective capitals Jan. 16-20. 
(PRENSA LATINA, 01/13/87) 


PANAMA TO REQUEST NATIONS THROUGHOUT WORLD TO MEDIATE ALONGSIDE CONTADORA 
  IN CENTRAL AMERICAN PEACE PROCESS 

According to Cuban news agency PRENSA LATINA (01/10/87), the 
Panamanian government plans to propose that United Nations 
member countries participate actively in Contadora and Support 
Group peace negotiations to settle the Central American conflict. 

A Panamanian diplomatic source said political negotiations should 
not be limited to the eight Latin American nations involved in the 
Contadora peace process. He added that participation of other 
nations throughout the world would strengthen the mediating efforts 
of Contadora. 

PANAMA: UNEMPLOYMENT DECLINES, EXPORTS INCREASE IN 1986 

According to a statistical report released by the Panamanian Labor 
and Social Welfare Ministry, the national unemployment rate dropped 
1.6% in 1986. In 1985 84,600 persons were unemployed, equivalent 
to 11.8% of the economically active population (EAP). Last year the 
number of officially unemployed persons dropped to 73,000 or 10.2% 
of the EAP.

The official report stated the drop in unemployment was an outcome 
of economic policies implemented by the administration of 
President Eric Arturo del Valle early last year. Employment growth 
was especially marked in metropolitan areas.

Next, a Trade and Industry Ministry report claimed export growth 
last year was substantial. Total exports rose by 25%, while sales of 
non-traditional exports increased by 40%. Banana and oil exports 
registered declines. (PANAPRESS, 01/21/87) 

PANAMANIAN SUGAR MILLS CLOSED DOWN 

As a result of low world market sugar prices, and reduced import 
quotas to the US market, two of six Panamanian sugar mills have 
been shut down, and sugar cane acreage has been cut back. 

Two of the four remaining mills are state-owned, two are private. 
As of Jan. 27, the sugar market crisis has resulted in the 
elimination of 1,600 jobs in the state-run industry administered by 
La Victoria Sugar Cane Corporation (CALV).

The possibility of converting sugar mill operations to the 
production of fuel alcohol has been under examination. However, 
government sources report that such conversion would require a $7 
million investment, and thus is not possible in the immediate 
future. (PRENSA LATINA, 01/27/87) 

TRADE BETWEEN PANAMA & COSTA RICA TEMPORARILY SUSPENDED 

Late last week trade between Panama and Costa Rica came to a 
temporary halt in protest of San Jose's failure to fulfill the 
"spirit and letter" of a bilateral trade agreement dating from March 
1975. Apparently Costa Rican businesspersons initiated the trade 
strike, and were supported by their Panamanian counterparts.

Among other things, the 1975 agreement authorizes citizens from 
both countries to import products duty-free, provided they remain in 
the other country 72 hours before returning home. In mid-December 
San Jose suspended this part of the agreement.

On Jan. 23 Panamanian Trade and Industry Minister Jose Bernardo 
Cardenas and Costa Rican counterpart Luis Diego Escalante signed an 
agreement in Panama City which established a bilateral commission 
with the aim of drafting development plans for the border region, 
known as Canaos. The commission has 60 days to draft a set of 
recommendations for bilateral cooperation in the areas of trade, 
health, education and security. (PANAPRESS, 01/23/87) 

February 1987

COCAINE FOUND ON BOARD DUTCH SHIP BY PANAMANIAN NARCOTICS AGENTS 

On Feb. 1 special narcotics agents of the Panamanian armed forces 
discovered and seized a large quantity of cocaine aboard the Dutch 
ship "Nedlloyd Linge." The drugs were found during a routine check 
of the vessel when it docked at San Cristobal, north of the Panama 
Canal zone on the Atlantic side. 

According to PANAPRESS (02/01/87), some 40 kgs. of cocaine were 
located in 120 boxes containing what appeared to be cans of 
"palmito natural" (palmetto buds). The shipment originated in 
Uruguay, bearing the Guayaki label. 

Investigators' reports indicate that the palmito or cocaine cargo 
was destined for Nicles Ltd., in the Colon free zone. The company is 
run by Manuel Fernandez, Luis Carlos Cordova and Vicente Scott. 


U.S.-PANAMANIAN JOINT MILITARY EXERCISES UNDERWAY NEAR COSTA RICAN BORDER 

On Feb. 4 joint US-Panamanian military maneuvers--labeled "Candela 
87" in Panama and "Kindle Liberty" by the Pentagon--began in the 
southern province of Chiriqui, Panama. Officially, the exercises are 
aimed at practice for defense of the Canal Zone, and will continue 
until Feb. 25.

Most US troops involved in Kindle Liberty are stationed at the 
Canal-based Southern Command. Also participating are members of 
the Florida National Guard and three battalions of the Panamanian 
armed forces.

According to SOUTHERN COMMAND NEWS, helicopters equipped with 
mine-detecting equipment operated by a team from Norfolk, 
Virginia, will also be used in the games.

The Kindle Liberty maneuvers are specified in the Torrijos-Carter 
Canal agreements signed in 1977. This year's exercises are to 
include a mock counter-attack against "guerrilla forces" from an 
imaginary Central American country.

In the words of Army Major Kenneth Robert, the maneuvers are aimed 
at "training US and Panamanian troops in sustained and prolonged 
struggle against insurgent forces coming from a third country." He 
added that this is the kind of war and enemy that Panama might face 
in the future.

While Kindle Liberty is justified as a rehearsal to defend the 
Panama Canal Zone in the event of an "enemy attack," it is curious 
that this year's exercises are being staged 400 km. north of the 
Canal Zone, or a few kilometers from the Costa Rican border. 
Corporation and TransWorld Arms, Inc. Other names on the chart have 
been identified earlier such as Lake Resources and Hyde Park Square 
Corporation. North's diagrams contain the names and initials of 
entities that have not been previously identified, including G & C 
Foundation, International Youth Comm., Gulf Marketing Consultants, 
and Toyco. 

 =============================================
 from The NY Transfer BBS 718-448-2358
 Source: NY OnLine BBS 718-852-2662

