Quayle Tours Panama, Gets Warm Reception : Diplomacy: But he visits traditionally pro-American neighborhoods. Country is still firmly under military occupation.

Vice President Dan Quayle toured Panama on Sunday in a series of photo opportunities designed, aides said, to demonstrate to the world that the country has returned to normal.

Clearly cheered by a series of warm receptions at an open air market, a church and a restaurant overlooking the Pacific, Quayle praised Panamanian support for the U.S. invasion last month that overthrew dictator Manuel A. Noriega.

Having “walked out with the people,” he said in a television interview, he can see “they’re glad for what we did.”

The expressions of public support appeared to be widespread, although most of Quayle’s visits were to neighborhoods of upper-class, traditionally pro-American section of the populace--not the lower-class population that once provided Noriega’s power base.

But while the support may be genuine, the picture of normality clearly is not. As Quayle spoke Sunday morning, dozens of American troops, their faces daubed with camouflage paint, ringed the hotel where the interview was taking place, establishing positions on nearby rooftops. As he moved through the city, military vehicles with machine guns made up nearly one-fourth of Quayle’s 21-car motorcade.

Outside the city, the U.S. Army continues to maintain fortified positions on main roads. And as Quayle’s interview, on ABC’s “This Week with David Brinkley,” was broadcast over the Southcom Network--the U.S. armed forces television here--a message scrolled across the bottom of the screen. It reminded American servicemen that a nighttime curfew remains in effect, off-base trips are restricted and visits to “public areas” are to be avoided.

Five weeks after the U.S. invasion, the number of U.S. troops here is being reduced and life has largely returned to normal, at least in the city, but Panama is still firmly under American military occupation.

The duration of that occupation was the chief topic as Quayle met Sunday morning with President Guillermo Endara and his two vice presidents, Ricardo Arias Calderon and Guillermo (Billy) Ford.

The Bush Administration would like to reduce troop strength here to pre-invasion levels as rapidly as possible because of “the international relations aspects,” an Administration official traveling with Quayle noted. Latin American leaders with whom Quayle met Saturday in Honduras emphasized their desire to see the troops withdrawn quickly.

But Endara and his government--although they also would like to see troop numbers reduced eventually--are more concerned about having Americans available “to preserve public safety,” the official said.

The new government has been working to create a new police force out of the remnants of Noriega’s Panama Defense Forces, but so far, U.S. officials admit, progress has been slow. Street crime levels are substantially higher than before the invasion, and sporadic shooting has continued in parts of the country’s interior.

While many Panamanians would like to keep the U.S. Army, the country is much less enthusiastic about an army of its own. “Panama doesn’t need an army,” Endara said on the Brinkley program. “Panama needs a police force.”

If Panama follows that rule, it will join Costa Rica, which abolished its army in 1948, as a notable exception to the region’s tradition of strong, highly politicized armed forces.

The U.S. government during the 1960s encouraged Panama to build up its army to protect the Panama Canal, and earlier this month Administration officials expressed uneasiness about the prospect of the nation following the Costa Rican model.

Quayle, however, said the Administration now regards it as a “good idea.”

U.S. officials now feel that if any truly serious military threat to the canal emerged, the U.S. would have to intervene--as it has the right to do under the Panama Canal Treaties--whether or not Panama had an army, a senior official said.