Panama-U.S. Relations [Updated March 26, 2001]   [open pdf - 113KB]

From the Document: "The December 20, 1989, U.S. military intervention in Panama, known as Operation Just Cause, heralded a new period in U.S.-Panamanian relations. In the aftermath of the intervention, U.S. policymakers immediately faced a new range of challenges including assistance for economic recovery, support for the development of a civilian police force, cooperation with the new government on counter-narcotics measures, and support for fragile democratic institutions. Panama has made abundant progress in all these areas, although the country still faces challenges. U.S. policymakers maintain an active concern about these issues because of continued U.S. interests in Panama, particularly the Panama Canal, which continues to be important to the United States for its commercial value. The Panamanian President's popularity fell significantly during the first year of her administration but improved in the latter part of 2000. A December 2000 public opinion poll showed an overall approval rating of 62%. However, many analysts believe that it will be difficult for President Moscoso to sustain her popularity because of sluggish economic growth and the administration's recent increases in electricity and telecommunications rates. The rate increases, which occurred in January 2001, resulted in violent street protests in the capital and led to many arrests. The political difficulties the president is facing may make it unlikely for her to gain legislative approval of proposed tax and social security reform measures she is proposing in March 2001. These measures are part of an agreement with the IMF that had been earlier scheduled for 2000. Without these reforms, the government will have difficulty meeting its fiscal and debt reduction targets or its public investment goals."

Report Number:
CRS Issue Brief for Congress, IB92088
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