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Panama Other Aspects of Panamanian-United States Relations
Panamanian relations with the United States, in areas other
than those related to the canal, have undergone increasing strains
since the 1985 ouster of President Ardito Barletta. The United
States protested this action by reducing economic assistance to
Panama and began pressuring Panama to reform its banking secrecy
laws, crack down on narcotics trafficking, investigate the murder
of Spadafora, and reduce the FDP's role in the government. When
these points were raised by United States ambassador-designate to
Panama, Arthur Davis, in his confirmation hearings, Panamanian
officials issued an official complaint, claiming that they were the
victim of a "seditious plot" involving the United States Department
of State, Senator Jesse Helms, and opposition politicians in
Panama.
Additional problems continued to arise throughout 1986 and
early 1987. In April 1987 the United States Senate approved a
nonbinding resolution calling for a 50-percent reduction in
assistance to Panama because of alleged involvement by that
nation's officials in narcotics trafficking. The Panamanian
legislature responded with a resolution of its own, calling for the
withdrawal of Panama's ambassador in Washington. Hearings on Panama
held by Senator Helms produced further controversy, especially when
a Senate resolution called on the United States Central
Intelligence Agency to investigate narcotics trafficking in Panama.
Again Panama protested. The FDP issued a resolution accusing Helms
of a "malevolent insistence on sowing discord," and the Panamanian
representative to the Nonaligned Movement's meeting in Zimbabwe
charged that the United States was not fulfilling the Panama Canal
treaties.
Continued United States pressure in such areas as human rights,
political reform, narcotics trafficking, and money laundering, as
well as conflicts over economic matters, including a reduction in
Panama's textile quota, kept relations tense during the first
months of 1987. In March Panama issued an official protest,
charging the United States with exerting "political pressures
damaging to Panama's sovereignty, dignity, and independence." This,
however, did not deter Senate passage, a few days later, of a
nonbinding resolution rejecting presidential certification of
Panamanian cooperation in the struggle against the drug trade.
President Ronald Reagan's certification that Panama was cooperating
in the struggle against drug trafficking was based on some
Panamanian concessions on bank secrecy laws and a highly publicized
narcotics and money-laundering sting operation
(see Finance
, ch. 3;
Involvement in Political and Economic Affairs
, ch. 5).
The deterioration in relations accelerated following the
outbreak of disturbances in June 1987. United States calls for a
full investigation of the allegations made by Díaz Herrera and for
movement toward "free and untarnished elections" led to Panamanian
charges of United States interference in its internal affairs.
The Legislative Assembly adopted a resolution demanding the
expulsion of the United States ambassador, and the head of the PRD
charged that United States pressures were part of a plot "not to
fulfill the obligations of the Carter-Torrijos Treaties," and were
also designed to "to get Panama to withdraw from the Contadora
Group." Panama took its protest over United States policy and the
Senate resolution to the Organization of American States (OAS),
which on July 1 adopted, by a vote of seventeen to one with eight
abstentions, a resolution criticizing the Senate resolution and
calling for an end to United States interference in Panama's
internal affairs. On June 30, a government-organized mob attacked
the United States embassy, inflicting over US$100,000 in damages.
The United States responded by suspending economic and military
assistance until the damage was paid for. Panama apologized for the
attack and, at the end of July, paid for the damage, but the freeze
on United States assistance remained in effect as a demonstration
of United States displeasure with the internal political situation.
Relations between the two nations failed to improve during the
balance of 1987. Attacks on United States policies by progovernment politicians and press in Panama were almost constant.
The actions of the United States ambassador were an especially
frequent target, and there were suggestions that he might be
declared persona non grata. There was also a growing campaign of
harassment against individual Americans. In September the economic
officer of the United States embassy was arrested while observing
an antigovernment demonstration. The following month, nine American
servicemen were seized and abused under the pretext that they had
been participating in such demonstrations. United States citizens
driving in Panama were repeatedly harassed by the Panamanian
police. Restrictions also were increased on United States reporters
in Panama.
For its part, the United States kept up pressure on Panama. In
August the secretary of state announced that the freeze on United
States aid would remain in effect, despite Panama's having paid for
the damage done to the embassy. In November the United States
cancelled scheduled joint military exercises with Panama. In
December Congress adopted a prohibition on economic and military
assistance to Panama, unless the United States president certified
that there had been "substantial progress in assuring civilian
control of the armed forces," "an impartial investigation into
allegations of illegal actions by members of the Panama Defense
Forces," agreement between the government and the opposition on
"conditions for free and fair elections," and "freedom of the
press." The same bill suspended Panama's sugar quota until these
conditions were met
(see Crops
, ch. 3). Panama responded by
ordering all personnel connected with the United States Agency for
International Development mission out of the country.
At the end of 1987, United States-Panamanian relations had
reached their worst level since at least 1964. On the United States
side, there was a high degree of agreement between the executive
branch and the Congress that fundamental changes in both the
domestic and international behavior of Panama's government were
needed. There was little sign of movement toward resolving any of
the basic issues that divided the two nations, and it appeared that
this deadlock would continue until there was a change in the
Panamanian leadership's position or composition.
Data as of December 1987
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