TIME: Almanac 1993/TIME Almanac 1993.iso/time/112690/1126106.000

Text File | 1992-08-28 | 5.5 KB | 118 lines

                                                                                NATION, Page 38

PANAMA

Meanwhile, Back in Panama


If the Noriega trial seems like a fiasco, consider the plight
of his country one year after the U.S. invasion

By RICARDO CHAVIRA/PANAMA CITY


    Even as the case against Manuel Noriega was degenerating
into a legal three-ring circus, the country he once dominated
was mired in a deep slump. Nearly a year after being installed
by the U.S. invasion, the government of President Guillermo
Endara is stumbling badly in the monumental chore of rebuilding
a country devastated by corruption and the financial squeeze
applied by the U.S. during the final two years of Noriega's
reign. Though Bush Administration officials praise Endara for
his good intentions, they fear that he and his government may
not be up to the task of converting Panama into a stable
democracy.

    One example of Panama's woes is the Atlantic Coast city of
Colon (pop. 100,000). Once a prosperous port of call for ocean
liners, today the country's second largest city seems to harbor
only misery. Rotting tenements line the streets, unemployment
exceeds 25%, drug use and violent crime are rampant. Deane
Hinton, the American ambassador to Panama, first visited Colon
in 1938, when it was "a beautiful city." Now, he says, it is
"a disaster area."

    The city's tragic transformation began in the 1950s, when
an economic boom in Panama City diverted investment and, later,
government spending from Colon. But after Noriega was
overthrown, there was hope that Colon might begin to recover.
More than 80 residents, most of them unarmed civilians, were
killed in the U.S. invasion, but even that toll seemed an
acceptable price for Colon's rehabilitation. "We thought maybe
this government would remember us," says Father Carlos Ariz,
bishop of Colon. "Instead the government says it has no way to
help."

    So far this year, although the U.S. has given Panama $130
million to pay off arrears on its $5 billion foreign debt,
Washington has laid out only $70 million in direct aid. "What
we're giving them is not even equal to direct damages caused
by the invasion," says former U.S. Ambassador Ambler Moss, who
estimates the destruction's price tag to be $1 billion.
Meanwhile, the surge in global oil prices has dealt the country
an unexpected and potentially disastrous blow. Totally
dependent on imported oil, Panama expects to see its petroleum
costs double to $300 million next year. Says Comptroller
General Ruben Carles: "The economy is strangled."

    Drug trafficking and money laundering, which reached
epidemic proportions under Noriega, continue to flourish. More
than 13,000 lbs. of cocaine -- worth $153 million wholesale in
the U.S. -- have been seized since January. "One can only
surmise that if this much is being seized, a lot more is
moving," says Hinton. At the same time, U.S. attempts to
control money laundering have been stymied by Panama's banking
laws, which remain unchanged since Noriega's days. Washington
is eager to negotiate a treaty that would give American
investigators access to secret accounts when they suspect
criminal activity. But Endara's associates claim this would
destroy the banking industry.

    Endara's task is not made easier by the fact that he
presides over a coalition government whose members seem to have
spent more time sniping at one another than governing. Critics
accuse the President and his ministers of handing out jobs to
cronies and relatives. That is part of a larger problem: Endara
and company are a throwback to the white-dominated governments
that ruled Panama until 1968. Military dictator Omar Torrijos
came to power that year and revolutionized the country by
giving government posts to blacks and mixed-race Panamanians --
some 90% of the country's 2.4 million people. The trend
continued with Noriega, and so while the abuses of 21 years of
military rule were rampant, nonwhite, frequently poor
Panamanians achieved unprecedented upward mobility. Under
Endara the rabiblancos, or "white tails," as wealthy whites are
known, are ascendant once more.

    Endara officials protest that it's unfair to expect rapid
solutions to Panama's problems. But it's equally unrealistic
to expect eternal patience from Panamanians. Leftist parties
and labor unions are the natural beneficiaries of popular
unrest. In recent weeks, antigovernment protesters have clashed
with riot police and blocked a major highway in the capital.
"It's not yet a simmering discontent," says a top Bush aide.
"But you can just start to see the steam rising."

    While the U.S. appears intent on lowering its profile in
Panama -- troop strength is below 10,000, less than half of
what it was during the invasion -- some in the new government
maintain that without extensive American involvement, the
fledgling democracy might collapse. Meanwhile, the Endara
government remains absorbed in its efforts to eliminate the
vestiges of Noriega. The general's Panama Defense Forces have
been replaced with a police force, and criminal charges are
pending against nearly 50 ex-military men. Banishing Noriega's
ghost is vital. Yet moving ahead is even more important.
American officials say they want to hand over the canal as
scheduled on Dec. 31, 1999. Whether the waterway ends up in the
control of a stable democracy or a new dictatorship may depend
on Endara's questionable ability to win the confidence of
Panama's battered and alienated poor.