Clark, Subic Bay Covered; a ‘Struggle,’ Shultz Says : U.S., Philippines Sign Bases Pact

Secretary of State George P. Shultz, admitting that negotiating with Manila is a “struggle,” joined Philippine Foreign Secretary Raul Manglapus on Monday in signing an agreement retaining U.S. rights to military bases in the Philippines for a two-year payment of nearly $1 billion in military and economic aid.

The pact, the result of more than six months of sometimes acrimonious negotiations, gives Washington the right to keep Subic Bay Naval Base and Clark Air Base--its two biggest and most important foreign military outposts--as well as four smaller facilities at least until 1991.

In exchange, President Reagan pledged a “good-faith” effort to obtain from Congress a total of $481 million in fiscal 1990 and fiscal 1991. That is more than 2 1/2 times the $180-million annual payment promised to the authoritarian government of former Philippine President Ferdinand E. Marcos in 1983, the last time the terms of the pact were reviewed.

‘Just Thrilled’

Shultz, who asserted that the agreement advances the security and national interest of both countries, said Washington is “just thrilled” at the progress the government of Philippine President Corazon Aquino has made toward establishing democracy.

“A democratic government is one you struggle with (in negotiations), but you struggle with a like-minded set of people,” Shultz said.

The Philippines originally demanded $1.2 billion a year for the bases, an amount the United States dismissed as excessive. Earlier in the negotiations, Shultz had said that unless Manila scaled down its demands, the United States would have no choice but to close the facilities.

The U.S. payments are not guaranteed because Congress must appropriate the money. In recent years, the United States failed to meet the promised aid level for several countries with American bases, such as Portugal and Spain. However, since Aquino’s “people power” movement ousted Marcos in February, 1986, U.S. aid has exceeded the level pledged to the former government. The aid program totals $352 million this year.

In a letter to Aquino made public during the signing ceremony, Reagan said the agreement “continues to meet our mutual needs and interests.”

The pact assures Manila that service personnel who test positive for acquired immune deficiency syndrome will not be assigned to Philippine bases.

The agreement papers over a dispute over the stationing of nuclear weapons at the bases, leaving the issue ambiguous. Although the pact bans the storage of nuclear weapons in the Philippines, it reaffirms Washington’s longstanding policy of neither confirming nor denying the presence of nuclear arms at any installation in the world.

U.S. officials say the agreement will not interfere with U.S. nuclear weapons policy. However, Manglapus said it meets the requirements of the new Philippine constitution banning nuclear weapons.

According to news agency accounts from Manila, several hundred leftist protesters marched on the U.S. Embassy on Monday to demand immediate closure of the bases. A left-wing coalition called the agreement “high treason.”

Asked about the demonstrations, Manglapus said: “It is my feeling that once my people understand the full meaning of the package, they will appreciate what has taken place here and they will accept it.”

Keep Options Open

Aquino has said she will keep all options open for Philippine action after the current agreement expires in 1991.

The latest agreement, technically the result of a periodic review of the existing bases contract, transfers to the Philippine government the ownership of buildings and utility systems at the facilities. If the agreement is allowed to lapse in 1991, Manglapus said, Manila would “acquire possession of these properties without paying compensation.”

In addition to the direct aid, the pact provides for a complex debt relief plan in which U.S. Treasury bonds will be used to guarantee a Philippine government bond issue.

Manglapus came to the United States late last month to address the U.N. General Assembly and extended his stay to complete the negotiations on the bases.

He said the accord provides “a more realistic and therefore firmer footing for our mutual relations.”