United States-Panama Security Act of 1997

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``United States-Panama Security Act of 
1997''.

SEC. 2. FINDINGS.

    The Congress finds the following:
            (1) The United States secured the independence of the 
        Republic of Panama, built the Panama Canal at considerable cost 
        in blood and treasure, and has provided for its management, 
        operations, maintenance, improvement, and defense throughout 
        the 20th century, providing a vital service to the peaceful 
        commerce of all nations as well as substantial returns to the 
        national interests of both the United States and Panama.
            (2) The Panama Canal continues to play a vital role both in 
        international trade and in the national security of the United 
        States, reducing the distance by sea between New York and San 
        Francisco by some 8,000 miles, contributing critical strategic 
        mobility to naval forces of the United States and substantial 
        savings to maritime commerce.
            (3) Absent any new base-rights agreement between the United 
        States Government and the Government of the Republic of Panama 
        allowing for a post-2000 United States military presence, 
        United States forces in Panama will be reduced to zero by 
        December 31, 1999, calling into question the ability of the 
        United States to continue to protect its interests in the area.
            (4) The Roosevelt Corollary to the Monroe Doctrine 
        proclaimed in 1904 that it was a national security concern of 
        the United States when foreign powers attempted to use public 
        or private investment as a vehicle for the expansion of 
        political and military influence in the Western Hemisphere.
            (5) The recent grant to Hutchison Whampoa, a Chinese firm 
        with ties to the Government of the People's Republic of China, 
        of management control of the Panamanian ports of Balboa and San 
        Cristobal, located at either end of the Panama Canal, has 
        raised the specter of the expansion of Chinese political 
        influence in Panama--a situation aggravated by unanswered 
        questions concerning the methods used by the Chinese firm to 
        win its bids.
            (6) In addition, Article V of the Treaty Concerning the 
        Permanent Neutrality and Operation of the Panama Canal, states 
        that only the Republic of Panama shall maintain military 
        forces, defense sites, and military installations in its 
        national territory after December 31, 1999.

SEC. 3. LIMITATION ON ASSISTANCE TO THE REPUBLIC OF PANAMA IF FORMER 
              UNITED STATES MILITARY FACILITIES IN THE REPUBLIC OF 
              PANAMA ARE CONVEYED TO ANY FOREIGN GOVERNMENT-OWNED 
              ENTITY.

    (a) Limitation on United States Assistance.--United States 
assistance may not be provided to the Republic of Panama for any period 
of time beginning after the date of the enactment of this Act during 
which a defense site or military installation, that is located within 
the territory of the Republic of Panama and that was at any time part 
of a defense site or military installation built or formerly operated 
by the United States, has been conveyed by the Government of the 
Republic of Panama to any foreign government-owned entity.
    (b) Opposition to Assistance From International Financial 
Institutions.--The President shall instruct the United States 
representative to each international financial institution to which the 
United States is a member to use the voice and vote of the United 
States to oppose any loans or other forms of assistance from that 
institution to the Republic of Panama for any period of time during 
which the Government of the Republic of Panama is in violation of the 
requirements of subsection (a).

SEC. 4. REPORTING REQUIREMENTS.

    (a) Report by the President.--Not later than 60 days after the date 
of the enactment of this Act, the President shall prepare and transmit 
to the Congress a report containing a description of how Hutchison 
Whampoa, a Chinese firm with ties to the Government of the People's 
Republic of China, was selected to receive a grant for management 
control of the Panamanian ports of Balboa and San Cristobal, located at 
either end of the Panama Canal, including whether or not the United 
States Government--
            (1) had any information concerning the bid by Hutchison 
        Whampoa to receive such grant;
            (2) provided adequate support to bids by United States 
        firms for such grant; and
            (3) had any knowledge of ties that exist between Hutchison 
        Whampoa and the Government of the People's Republic of China.
    (b) Report by the Secretary of Defense.--Not later than 60 days 
after the date of the enactment of this Act, the Secretary of Defense 
shall prepare and submit to the Congress a report containing--
            (1) a description of the extent to which the control of the 
        ports San Cristobal and Balboa in the Republic of Panama by 
        Hutchison Whampoa, a Chinese firm with ties to the Government 
        of the People's Republic of China, poses a threat to the 
        security of the United States; and
            (2) a description of how the strategic interests of the 
        United States with respect to the Panama Canal will continue to 
        be protected after the Government of the Republic of Panama 
        assumes sole responsibility for the defense of the Canal and 
        becomes the only entity entitled to have military forces, 
        defense sites, or military installations in Panama after 
        December 31, 1999.
    (c) Reports by the Director of Central Intelligence.--Not later 
than March 31 of each year, the Director of Central Intelligence, in 
cooperation with the heads of other appropriate Federal agencies, 
including the Director of the National Security Agency, the Director of 
the Federal Bureau of Investigation, the Secretary of Defense, the 
Secretary of the Treasury, the Secretary of Commerce and the Secretary 
of State, shall prepare and submit to the Congress a report, in both 
classified and unclassified form, on the intelligence activities of the 
People's Republic of China against or affecting United States interests 
in the Republic of Panama, including a description of--
            (1) the extent of political, military, and economic 
        espionage by the People's Republic of China;
            (2) the extent of intelligence activities by the People's 
        Republic of China designed to gain political influence;
            (3) efforts by the People's Republic of China to gain 
        direct or indirect influence through commercial or 
        noncommercial intermediaries subject to control by the People's 
        Republic of China, including enterprises controlled by the 
        People's Liberation Army; and
            (4) disinformation or press manipulation directed against 
        the United States.
    (d) Report by the Director of the Office of National Drug Control 
Policy.--Not later than 60 days after the date of the enactment of this 
Act, the Director of the Office of National Drug Control Policy shall 
prepare and submit to the Congress a report on the utility of 
maintaining a military presence in the Republic of Panama for 
interdicting illegal drugs.

SEC. 5. RENEGOTIATION OF THE PANAMA CANAL TREATY.

    (a) Renegotiation of Existing Treaties; Negotiation of New 
Treaty.--The President is authorized and directed to confer with the 
Government of the Republic of Panama to renegotiate the terms of the 
Panama Canal Treaty and the Treaty Concerning the Neutrality and 
Operation of the Panama Canal, or to negotiate a new agreement to 
supersede the such Treaties, for the purpose of providing for the 
security of the Canal into the 21st Century.
    (b) Sense of the Congress.--It is the sense of the Congress that 
any negotiations conducted under subsection (a) should include the 
following:
            (1) A ban on foreign government investment in, or 
        management of, the Panama Canal and related projects or other 
        infrastructure projects related to transit across the isthmus 
        of Panama or through Panamanian territory.
            (2) The right to a continuing United States military 
        presence in Panama to actively cooperate with Panama in the 
        defense of the Panama Canal.
            (3) A continuing United States presence in Panama to 
        actively cooperate with Panama in the interdiction and 
        eradication of illegal drug trafficking through the territory 
        of Panama or adjacent areas.
            (4) The right to control or prohibit the use of the Panama 
        Canal by hostile powers, terrorist states, or criminal groups, 
        by redefining the terms of the 1977 Treaty Concerning the 
        Neutrality and Operation of the Panama Canal to apply only to 
        its peaceful, non-belligerent use by states or entities other 
        than the United States and Panama.

SEC. 6. DEFINITIONS.

    As used in this Act:
            (1) Panama canal treaty.--The term ``Panama Canal Treaty'' 
        means the Panama Canal Treaty between the United States and the 
        Republic of Panama, signed at Washington on September 7, 1977 
        (33 UST 39).
            (2) Treaty concerning the permanent neutrality and 
        operation of the panama canal.--The term ``Treaty Concerning 
        the Permanent Neutrality and Operation of the Panama Canal'' 
        means the Treaty Concerning the Permanent Neutrality and 
        Operation of the Panama Canal between the United States and the 
        Republic of Panama, signed at Washington on September 7, 1977 
        (33 UST 1).
            (3) United states assistance.--The term ``United States 
        assistance means--
                    (A) assistance under part I of the Foreign 
                Assistance Act of 1961 (22 U.S.C. 2151 et 
                seq.)(including programs under title IV of chapter 2 of 
                such part; relating to the Overseas Private Investment 
                Corporation), except that such term does not include 
                humanitarian assistance;
                    (B) assistance under chapter 2 of part II of the 
                Foreign Assistance Act of 1961 (22 U.S.C. 2311 et seq.; 
                relating to military assistance), including the 
                transfer of excess defense articles under section 516 
                of such Act;
                    (C) assistance under chapter 5 of part II of the 
                Foreign Assistance Act of 1961 (22 U.S.C. 2347 et seq.; 
                relating to international military education and 
                training);
                    (D) assistance under the ``Foreign Military 
                Financing Program'' under section 23 of the Arms Export 
                Control Act (22 U.S.C. 2763);
                    (E) the transfer of defense articles, defense 
                services, or defense and construction services under 
                Arms Export Control Act (22 U.S.C. 2751 et seq.), 
                including defense articles and defense services 
                licensed or approved for export under section 38 of 
                such Act; or
                    (F) financing under the Export-Import Bank Act of 
                1945.

Summary: United States-Panama Security Act of 1997 - Bars US assistance to Panama during any period in which a defense site or military installation located in Panama that was at any time part of a site or installation built or formerly operated by the United States has been conveyed by the Government of Panama to any foreign government-owned entity. Directs the President to instruct the US representatives to the international financial institutions to oppose any loans or other assistance to Panama during any such period. Requires the President to report to the Congress on how Hutchison Whampoa, a Chinese firm with ties to the Chinese Government, was selected to receive a grant for management control of the Panamanian ports of Balboa and San Cristobal. Directs the Secretary of Defense to report to the Congress on: (1) the extent to which the control of such ports by such firm poses a threat to US security. And (2) how US strategic interests with respect to the Panama Canal will continue to be protected after the Government of Panama assumes sole responsibility for the defense of the Canal and becomes the only entity entitled to have military forces, defense sites, or military installations in Panama after December 31, 1999. Requires: (1) the Director of Central Intelligence to report annually to the Congress on the intelligence activities of China against or affecting US interests in Panama. And (2) the Director of the Office of National Drug Control Policy to report to the Congress on the utility of maintaining a military presence in Panama for interdicting illegal drugs. Authorizes and directs the President to confer with the Government of Panama to renegotiate the terms of the Panama Canal Treaty and the Treaty Concerning the Neutrality and Operation of the Panama Canal or to negotiate a new agreement to supersede such treaties. Expresses the sense of the Congress that any negotiations should include: (1) a ban on foreign government investment in or management of the Canal and related projects. (2) the right to a continued US military presence in Panama and a continued presence to interdict and eradicate illegal drug trafficking through Panama. And (3) the right to control or prohibit the use of the Canal by hostile powers, terrorist states, or criminal groups by redefining the terms of the 1977 Treaty Concerning the Neutrality and Operation of the Panama Canal.