U.S. Rules Out Direct Talks With Nicaragua : Reagan ‘Generally Encouraged’ by Managua Response, but Shultz Stresses Regional Effort

President Reagan is “generally encouraged” by Nicaragua’s response to his new Central American peace proposal, the White House said Thursday, but hopes for the plan dimmed anyway as the Administration rejected a Nicaraguan demand for direct talks with the United States.

At a news conference, Secretary of State George P. Shultz called it “critical to establish” in the wake of Reagan’s call for a regional peace agreement “that there is no way the United States would want to sit down with Nicaragua to decide what is right for Central America.

“That has to be done by all the Central American countries,” he said.

Shultz’s remarks, echoed by White House spokesman Marlin Fitzwater, left open the prospect that the United States might join Nicaragua in peace talks if four other nations with White House backing--Costa Rica, El Salvador, Honduras and Guatemala--also were at the table.

But that would not meet Nicaraguan President Daniel Ortega’s call for an “unconditional dialogue” between Nicaragua and the United States on both Reagan’s proposal and Ortega’s own plans for a cease-fire between his government and U.S.-backed contras.

Ortega Sees ‘Sham’

As he arrived in Guatemala City on Thursday for a five-nation meeting of Central American leaders, Ortega said that U.S. rejection of one-on-one talks would prove that “the whole thing is a sham, a publicity stunt designed to impress whoever they think is gullible enough.”

Fitzwater said Thursday that Ortega’s sharp response was not unexpected. The Administration remains optimistic about the peace plan “because he didn’t reject it and he’s obviously aware that this is a process he wants to take seriously.”

The Administration has shunned direct talks with Nicaragua since 1985 because it wants to pressure the Sandinista regime into negotiating with the contras. Nicaragua has insisted on talks with the United States, not the contras, because the contras subsist largely on American aid.

Administration officials continued to toe the line against direct talks with Ortega, but they declined Thursday to say that the contras must be a participant in any Central American peace talks.

Open Question

“Obviously, any cease-fire would have to be acceptable to the contras,” Fitzwater said, “but exactly who would be involved in the negotiation, who would be at the table, is something yet to be determined.”

Some Senate Democrats who met with Reagan on Thursday agreed later that the White House peace plan is a serious proposal and not a “stunt,” but they split on whether the plan itself is a good idea.

Sen. Ernest F. Hollings (D-S.C.) called the proposal “a sellout” of the contras and said his major worry is “that Ortega’s going to accept this one . . . and that will be the end of the contras.”

Senate Intelligence Committee Chairman David Boren (D-Okla.), however, said he is “elated” at the plan and said that it marks a return to congressional-White House cooperation on foreign policy. House Speaker Jim Wright (D-Tex.) took a leading role in working with the White House in drafting the plan.

Senate Majority Leader Robert C. Byrd (D-W.Va.) also praised the proposal, but he said the Sept. 30 deadline for Nicaraguan acceptance of the plan imposed by the White House is “unrealistic” and should be changed.

The President’s proposal would establish a cease-fire in place between the contras and the Nicaraguan army, suspend White House efforts to win Congress’ approval of further military aid for the contras, as well as current military aid, if in return Nicaragua agrees to stop receiving aid from the Soviet Bloc, lift a national state of emergency, restore certain civil liberties and set a timetable for free elections.

The deadline by which the Reagan plan requires the Sandinista regime to meet those terms--Sept. 30--is the day on which current U.S. military aid to the contras expires. A State Department official, speaking on condition that he not be named, acknowledged Thursday that it would be “very difficult” for Nicaragua to meet that deadline.

Reagan also had indicated that he would resume lobbying Congress for contra aid in two weeks if Ortega does not show genuine interest in the plan. Fitzwater said Thursday that the waiting period is “under discussion” after protests from House Speaker Wright.

Nicaragua’s ambassador to the United States, Carlos Tunnermann, said that his government hopes Reagan’s plan “is a serious initiative and that it has been issued in a constructive spirit.”

Fitzwater and Shultz both expressed hope that the Central American leaders in Guatemala City will respond favorably to the White House proposal, parts of which resemble a peace plan put forth by President Oscar Arias Sanchez of Costa Rica.