U.S. Waging ‘Economic War,’ Panamanian Says

UNITED NATIONS — President Manuel Solis Palma of Panama, in a fiery speech to the U.N. General Assembly, accused the United States on Tuesday of waging “economic war” against his country in order to keep control of the Panama Canal and dominate all of Latin America.

U.S. Ambassador Vernon A. Walters, who boycotted the Panamanian’s address because Washington does not recognize his government, issued a statement branding the charges a “litany of false accusations.”

“The U.S. government is firmly and unequivocally committed to the spirit and the letter of the Panama Canal Treaties of 1977,” Walters said. “The U.S. sanctions imposed earlier this year were an overlay on what was already a seriously troubled economy, one which will not recover in the absence of a restoration of political stability.”

Walters said it is the insistence of Panama’s strongman, Gen. Manuel A. Noriega, on “subordinating the good of Panama to his own personal gain that is the true cause of Panama’s economic and political problems.” Noriega has been indicted in Miami on drug-trafficking charges.

Solis Palma charged that American economic pressure since February has cost Panama $2 billion--20% of its annual gross national product--so far this year. This fact alone, he declared, calls for a change in the U.N. Charter to enable the Security Council to take action against economic well as military aggression.

He placed his nation among those developing countries that face danger in the wake of nuclear agreements between the superpowers, which have raised the value of conventional military bases. Because U.S. bases in Panama are scheduled to be abandoned when control of the canal is handed over by Washington in 1999, he said, the United States wants to break its pledge and expand its military presence--an action that would be contrary to the treaties’ provision that only the number of troops needed to defend the canal should remain.

‘Monstrous Image’

Solis Palma also condemned the power of the industrialized nations to manipulate information, which he said Washington has exercised to create a “monstrous image” of Panama and its leaders.

“The whole campaign against the commander in chief of the defense forces of Panama, Gen. Manuel Antonio Noriega, is no more than a sinister game of lies and falsehoods, organized and executed by U.S. agents,” he said.

Panama’s forces have carried out an “exemplary” anti-narcotics program under Noriega, Solis Palma asserted. He quoted Senate testimony last July by John C. Lawn, chief of the Drug Enforcement Administration, that Lawn had never seen any proof linking Noriega to drug trafficking, despite the indictments.

The Panamanian conceded that his government has failed to achieve democracy, but he said that “no foreign power can utilize all its resources of disinformation and manipulation” to interfere on any pretext.

He bitterly protested the freezing of $54 million in U.S. deposits at the Bank of Panama as well as the impounding of canal tolls by presidential decree.

The United States took unusual steps to make it clear that Solis Palma was unwelcome, although it did not deny him a visa. But he was neither greeted officially nor accorded Secret Service protection normally given to all visiting heads of state.