Published in The Washington Times Commentary Section Monday August 18, 1997Panama Map

Who Will Control the Path
Between the Seas?


by Lt. Gen. Gordon Sumner, Jr. (USA-Ret)
(Former Chairman, Inter-American Defense Board)
and Howard Phillips, Chairman of The Conservative Caucus, Inc.

With virtually no serious debate, Congress has committed $6 billion to pay for U.S. intervention in Bosnia, where no perceptible U.S. vital interest is at risk.

Closer to home, Congress has thus far proven unwilling to spend a fraction of that amount (less than $100 million per year) to maintain an essential U.S. military presence at the isthmus at Panama and to block eventual control of the isthmus by interests allied with Communist China.

At the beginning of 1997, there were 6,800 U.S. military personnel in Panama. By the end of this year, that number will have been reduced to 4,410.

Under the terms of the Carter-Torrijos Panama Canal Treaty, which expires on December 31, 1999, America is not obliged to leave Panama until midnight, as the Year 2000 begins.

Nonetheless, in a "penny-wise, pound-foolish" manner, we have been prematurely reverting facilities and resources years before the Canal Treaty requires.

Moreover, the 1978 treaty provides a procedure whereby a continuing U.S. presence well into the next century can be secured.

The Panama Canal Neutrality Treaty reads as follows: "Nothing in the Treaty shall preclude the Republic of Panama and the United States of America from making...agreements or arrangements for the stationing of any United States military forces or the maintenance of defense sites after that date in the Republic of Panama that the Republic of Panama and the United States of America may deem necessary or appropriate."

A U.S.-Panama accord to carry forward the American presence is not "pie in the sky". Surveys conducted in Panama over a period of years have indicated repeatedly that the overwhelming majority of Panama's citizens want America to stay. The margin of support swells to 80% and beyond if the U.S. agrees to pay a leasing fee to maintain its presence.

Our opportunity to negotiate such an accord is nothing new. It has been there since the late 1970s. Many of us had hoped that Ronald Reagan would take early action to exercise it during his presidency, or that George Bush would.

Instead, top Panamanian officials have attested, some with disappointment, that Generals Brent Scowcroft and Colin Powell, acting in behalf of the Bush administration, made it very clear that it was their intention to expedite the U.S. withdrawal, and that, under no circumstances, would they consider a lease arrangement for continuation of the bases.

And Bill Clinton has squandered more than four years, failing to proceed in a timely and serious manner.

With each passing day, America's options in Panama are being narrowed. We are creating a political vacuum and there are already signs that potentially hostile forces are moving to fill that vacuum.

Already, key port facilities on the Atlantic and Pacific sides of the Canal (Cristobal and Balboa) have been leased by Hutchison Whampoa, 10% of which is owned by China Resources Enterprises (100% of which is controlled by the Red Chinese government).

A major share of Hutchison Whampoa is owned by Li-Ka-Shing, a Hong Kong billionaire, heavily dependent on good relations with Beijing. Hutchison Wampoa itself is used by Beijing to run commercial ports controlling a preponderance of South Chinese's seaborne commerce.

Hutchison Whampoa is closely associated with the China Ocean Shipping Company (COSCO), a 600-ship global corporation supervised by the People's Liberation Army (PLA).

As part of the Cristobal-Balboa lease agreement, in apparent violation of the Carter-Torrijos Treaty, contractual influence over facilities adjacent to Cristobal and Balboa has been assigned to Hutchison.

The 25-year lease will cost Hutchison $22.2 million a year, but the deal grants a two-year waiver of labor laws and veto rights over the use of abutting properties (in clear violation of the Panama Canal treaty). A Hutchison lawyer, Hugo Torrijos, was also the head of the port authority that awarded the contract.

Red Chinese influence in Panama is growing in many ways. Recently, the Bank of China extended a 15-year $120 million loan to Panama at 3% interest to finance the government's investment program and to purchase and sell assets.

And, under pressure from Communist China, both the United States and the United Nations have withdrawn from official participation in a ceremony scheduled for this September to commemorate the completion of the Panama Canal in 1914 (the Universal Congress of the Canal in Panama).

Panama is one of only 30 countries in the world which continues to recognize the Republic of China on Taiwan. Arguably, of all those countries it is the most important to Taiwan's international standing.

Taiwan has considerable investments in the Republic of Panama, but now it is being crowded by the Communist Chinese. Last year, Red China seized recognition away from Taiwan in the Republic of South Africa, despite Taiwan having contributed substantial sums into the political coffers of Nelson Mandela's African National Congress, and despite RSA President Mandela's personal promise that recognition of Taiwan would be maintained under his leadership.

Panama's President Balladares, similarly, is now asserting that there is no intent to shift official recognition from Taipei to Beijing, but, in Panama as elsewhere, money and momentum can have an impact on political decisions.

Just as Soviet hegemony in Cuba during the 1960s, 1970s, and 1980s had a significant impact on U.S. national security, in a similar fashion, the growing Communist Chinese presence in Panama could have highly adverse consequences for America during the decades just ahead.

Congress can show that it understands this problem by asserting its intent to provide: a) necessary funds through December 31, 1999 to prevent the premature reversion of U.S. facilities before then and b) adequate funds thereafter to maintain a continuing presence, one which will have the support of the Panamanian people.

Unless they act soon, America will lose:

- the ability to project power from the Arctic Circle to Antarctica, solidly positioned at "the belt buckle" of the Western Hemisphere,
- the ability to defend the Panama Canal from acts of terrorism or sabotage,
- the ability to train 7,800 military personnel annually at Panama's topographically and climatologically unique Jungle Operations Training Base,
- the ability to outflank terrorist and guerilla activity in Central America and the Caribbean,
- the ability to effectively monitor drug activity in South America,
- the ability to rapidly transfer U.S. Naval vessels between the Atlantic and Pacific Oceans,
- the ability to monitor submarine activity in the Atlantic and Pacific,
- the ability to prevent an alien power, such as Red China or the drug traffickers, from controlling the isthmus.

Senate Majority Leader Trent Lott (whose home state benefits from cargo ships transiting the Canal) and House Speaker Newt Gingrich should act promptly so that Messrs. Clinton and Gore will be unable to point their fingers to Capitol Hill when the question is asked, "Who lost the Panama Canal?".

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Copyright 1997 The Conservative Caucus, Inc.  All rights reserved.