U.S. Reported Backing Panama Shake-up Plan : Proposal Would Ease Out Strongman Noriega and Reassure His Underlings

The United States is attempting to midwife a plan that would ease Panama’s strongman, Gen. Manuel A. Noriega, out of power but assure his underlings that they have nothing to fear from a change to civilian rule, U.S. and Panamanian exile sources say.

In an unpublicized meeting with Noriega last month, Richard L. Armitage, the assistant U.S. secretary of defense for international security affairs, told Noriega to consider the plan as a way of ending the country’s turmoil, U.S. officials said, confirming various media reports. The goal of Armitage’s trip was to convince Noriega that the U.S. government is united in demanding that he step down.

There has been no indication, however, that Noriega is willing to cooperate.

Grand Jury Probes

Implicit in the plan is the dropping of two possible U.S. indictments that may be issued by a pair of grand juries in Florida, the sources say. The grand juries are investigating allegations that Noriega has links to international drug smuggling, they say. Dropping the indictments would permit Noriega to go into exile after relinquishing power without fear of extradition and prosecution by the United States.

The proposal also calls for the ouster of eight close associates of Noriega and perhaps another half-dozen high-ranking officers of the Panama Defense Forces who have reached retirement age, according to the sources. Neither they nor the rest of the officer corps would be held responsible for the many crimes that the Defense Forces are alleged to have committed under Noriega’s command.

Such guarantees are a clear attempt to drive a wedge between Noriega and his troops.

“The survival of the military forces without Noriega is the key,” said a Panamanian familiar with the plan.

Whether dismissing any indictments against Noriega and assuring a prosecution-free transition to civilian rule would be enough to sway Noriega and his backers is open to debate. After a summer of numerous street protests, Noriega has succeeded in cowing his public opponents into near silence. He has closed opposition newspapers and banned demonstrations.

U.S. government officials say that since the Armitage visit, Noriega has been telling confidants that the United States is not serious about removing him from power.

“He’s running around Panama City telling people the U.S. is still his friend,” one U.S. official said.

It is also uncertain that the United States is prepared to take further direct steps to push Noriega out. It already has cut off military and economic aid to Panama, ended Panamanian sugar sales to the United States under an import quota program and suspended routine joint military maneuvers between Panamanian and U.S. forces.

The U.S. government could take more steps--for instance, ending the ship-to-ship flow of Alaskan oil through Panamanian pipelines from the Pacific to Atlantic oceans. The pipeline earns the Panamanian government $150 million a year.

Nonetheless, economic problems brought on by six months of turmoil are deepening in Panama. The Panamanian government may have trouble meeting its payrolls later this winter. In addition, a pullout of money from Panamanian banks has reduced the amount of money available in Panama for commercial and construction loans, further squeezing the economy.

In any event, the plan is seen as a way not only to cool tensions in Panama but restore warm relations between the United States and Panama. By treaty, the United States is scheduled to turn full control of the Panama Canal over to Panama on Dec. 31, 1999.

The proposal to smooth Noriega’s way out was formulated last September by associates of Noriega in concert with exiled Panamanian opposition leaders, the U.S. and Panamanian sources said. It has since been circulated in Panama City, and optimistic opponents of the government contend that middle-level military officers look favorably on the proposal, although that could not be independently confirmed.

Delvalle Would Stay

The plan calls for Noriega to step down by April, a year before scheduled presidential elections. The administration of President Eric Arturo Delvalle, who heads the nominal civilian government of Panama, would remain in place.

A new electoral council, presumably independent of the government, would be created to organize the next elections. Elections in 1984 were reported to have been fraudulent as the military moved to ensure the victory of its candidate.

The president elected in 1989 would choose a commander of the Defense Forces from a list presented to him by top military officers. The commander would serve a maximum of five years.

The plan suggests that military salaries and benefits be increased to make up for the elimination of military-owned businesses, both legal and illicit.

Freedom of Noriega and his associates from prosecution by either the United States or the new Panamanian authorities is considered a promise necessary not only to ensure Noriega’s agreement but to ease concerns about the future of a potential ally in a strategic position in the Western Hemisphere.

The United States maintains 10,000 troops at its Southern Command headquarters near the Panama Canal. The Pentagon, with no place to relocate the Southern Command, is hesitant to jeopardize its Panamanian home. It was that kind of consideration that led to speculation about policy differences between the American State and Defense departments.

“There’s worry about who will follow Noriega,” one U.S. official said. The official recalled that when Nicaraguan dictator Anastasio Somoza was forced from office in 1979, the National Guard under his command fell apart, opening the way for a takeover by the Marxist-led Sandinista guerrilla army.

Armitage’s mission was meant to show Noriega that the Reagan Administration is united in its distaste for military rule in Panama. However, there was some concern among congressional opponents of Noriega that Armitage may have delivered too soft a message. One congressional staff member described Armitage as “less than lukewarm” in wanting to pursue a get-tough policy with Noriega. Sources in the Pentagon say Armitage went only reluctantly.

Armitage, who has been traveling abroad, could not be reached for comment. He met with Noriega in Panama City for more than two hours Dec. 30, U.S. officials say.

The United States began to cool toward Noriega in 1986 when reports of rampant drug smuggling and money laundering through Panama prompted a series of warnings from the U.S. government.

Last June, a former close aide of Noriega’s publicly accused the general of a variety of crimes, including money laundering, the killing of a political opponent and the orchestration of electoral fraud. Panamanian citizens took to the streets for a series of demonstrations that appeared to threaten Noriega’s rule. But after Noriega cracked down by arresting dissident leaders and closing newspapers, the country quieted down.