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Panama Falling Far Short of Funds for Payroll

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Times Staff Writer

The government of Panama has between $4 million and $5 million in cash on hand, an amount that falls far short of the amount needed to make even partial salary payments due next week for government employees, government sources said Friday.

The figures suggest that economic pressure on the government of military strongman Manuel A. Noriega is approaching a breaking point.

But Noriega continues to give no sign of any intention of yielding power. During a television interview at his headquarters in Panama City on Friday, he was asked by a Latin American reporter to comment on a declaration by President Reagan that he must step down. Noriega replied, “I don’t take orders from outer space.”

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U.S. Funds Frozen

The estimate of available government cash confirms what recent events on the street of this capital had already signaled: Noriega’s government has not yet found an alternative source of money to the $50 million in funds frozen in the United States earlier this month by courts, acting on petition of Noriega foes backed by the Reagan Administration.

In a gallows-humor tone, Noriega offered this view of what pressure might come next from the United States: “They could drop the atom bomb, cut off the air we breath, or block the sun,” he said on television.

Two weeks ago, Panama’s 140,000 public employees received up to a maximum of $75 each in the wages due them. The partial payments set off a series of public workers’ strikes that increased labor pressure on Noriega to resign and go into exile.

Some Soldiers Paid

Normally, Friday would have been payday for soldiers, but some of Noriega’s troops reported they had not gotten paid, either by check or cash. Other soldiers interviewed in Panama City, however, said they had received their paychecks as usual and cashed them at a military bank. Still others, who had yet to go to their barracks to collect, said they did not know if they would receive any or all of their pay on time.

On Monday, the government is supposed to pay pensions to retired workers, and the balance of the official payroll is due by the end of March.

Panama’s government pays salaries every two weeks. The normal biweekly outlay is about $30 million, minus deductions for taxes and social benefits. In its scramble to find money to meet the payroll, authorities are trying to obtain Panamanian government money held in European, Asian and South American banks, the sources said.

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May Force Banks to Open

During his television interview, Noriega hinted that the government might force banks, which have been closed since early March, to open and release cash stored in their vaults.

“It is necessary to open the banks so that . . . money will circulate,” Noriega said.

The cash shortage has triggered an unprecedented slowdown of the Panamanian economy. In addition to the problems of striking public workers, employees in the private sector have been unable to cash their payroll checks because the banks are closed. Moreover, many private companies have shut down in the crisis, and large numbers of workers have been laid off.

Lack of work has driven thousands of Panama’s poor to seek aid from the Roman Catholic Church, which is now suppling emergency food rations to about 7,000 families.

Strike Enters 5th Day

A general commercial strike called by the Civic Crusade, an anti-Noriega coalition of business and professional groups, entered its fifth day Friday, the longest such action taken during the sporadic protests against Noriega that began last June. The doors of most businesses and industries in Panama City remained closed.

The Civic Crusade is trying to increase pressure on Noriega by getting the Roman Catholic church actively involved against him, but the church, headed by Archbishop Marcos G. McGrath has been careful to avoid openly calling for the strongman’s ouster.

On Thursday, Panama’s 11 bishops met with Noriega and handed him a letter expressing their concerns about the political crisis. Rumors circulated that the bishops asked him to retire, but McGrath declined to reveal the contents of the letter.

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U.S. Interference Alleged

The government also accused officials at U.S. military bases along the Panama Canal of interfering in Panama’s internal affairs. The Panamanian Foreign Ministry complained to the U.S. Embassy about a recent news briefing at the headquarters of the Southern Command, which oversees 10,000 American servicemen stationed in Panama.

The Foreign Ministry said that the briefing, given to nearly 50 foreign correspondents now working here, was designed to destabilize Panama and that the military briefing officer had told the reporters that they should help in ousting Noriega.

Embassy officials said they would not respond to the complaint because Washington does not recognize the Panamanian government currently in power. The United States considers Eric A. Delvalle as Panama’s legal president. Delvalle was deposed a month ago when he tried to fire Noriega from his post of commander of the Panama Defense Forces, the nation’s sole military and police organization.

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