Implementing the Panama Canal Treaty of 1977--Good Planning but Many Issues Remain

Since early 1978, U.S. Government officials in Panama, former Canal Zone officials, and representatives of Panama have been preparing for the orderly and efficient implementation of the Panama Canal Treaty. Two principles have guided the planning activities: (1) the tactical capabilities of the military forces to defend the Panama Canal will not be degraded, and (2) the present quality and level of all current services and support to U.S. citizens in the area will be sustained to the maximum extent possible. Within this framework, the United States and Panama have made good progress in implementing the changes mandated by the Panama Canal Treaty. The transfer to Panama of various port and railroad activities, certain health and sanitation services, vehicle licensing, and utility billing and price setting has proceeded smoothly. In addition, commercial retail operations were satisfactorily transferred to Panama for operation by private interests. Substantial progress has been made in implementing the important personnel changes required by the treaty or by the Panama Canal Act of 1979. Nevertheless, certain basic unresolved issues and problems hinder full implementation of the treaty.