I

106TH CONGRESS

1ST SESSION H. R. 2244

To prohibit United States assistance to the Republic of Panama if 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, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

JUNE 16, 1999

Mr. HUNTER introduced the following bill; which was referred to the Committee on International Relations, and in addition to the Committees on

Banking and Financial Services, Armed Services, and Intelligence (Permanent Select), for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

A BILL

To prohibit United States assistance to the Republic of Panama if 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, and for other

purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,
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1 SECTION 1. SHORT TITLE.

2 This Act may be cited as the ‘‘United States-Panama

3 Security Act of 1999’’.

4 SEC. 2. FINDINGS.

5 The Congress finds the following:

6 (1) The United States secured the independence

7 of the Republic of Panama, built the Panama Canal

8 at considerable cost in blood and treasure, and has

9 provided for its management, operations, mainte10 nance, improvement, and defense throughout the

11 20th century, providing a vital service to the peace12 ful commerce of all nations as well as substantial re13 turns to the national interests of both the United

14 States and Panama.

15 (2) The Panama Canal continues to play a vital

16 role both in international trade and in the national

17 security of the United States, reducing the distance

18 by sea between New York and San Francisco by

19 some 8,000 miles, contributing critical strategic mo20 bility to naval forces of the United States and sub21 stantial savings to maritime commerce.

22 (3) Absent any new base-rights agreement be23 tween the United States Government and the Gov24 ernment of the Republic of Panama allowing for a

25 post-2000 United States military presence, United

26 States forces in Panama will be reduced to zero by
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1 December 31, 1999, calling into question the ability

2 of the United States to continue to protect its inter3 ests in the area.

4 (4) The Roosevelt Corollary to the Monroe Doc5 trine proclaimed in 1904 that it was a national secu6 rity concern of the United States when foreign pow7 ers attempted to use public or private investment as

8 a vehicle for the expansion of political and military

9 influence in the Western Hemisphere.

10 (5) The recent grant to Hutchison Whampoa, a

11 Chinese firm with ties to the Government of the

12 People’s Republic of China, of management control

13 of the Panamanian ports of Balboa and San Cris14 tobal, located at either end of the Panama Canal,

15 has raised the specter of the expansion of Chinese

16 political influence in Panama—a situation aggra17 vated by unanswered questions concerning the meth18 ods used by the Chinese firm to win its bids.

19 (6) In addition, Article V of the Treaty Con20 cerning the Permanent Neutrality and Operation of

21 the Panama Canal, states that only the Republic of

22 Panama shall maintain military forces, defense sites,

23 and military installations in its national territory

24 after December 31, 1999.
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1 SEC. 3. LIMITATION ON ASSISTANCE TO THE REPUBLIC OF

2 PANAMA IF FORMER UNITED STATES MILI3 TARY FACILITIES IN THE REPUBLIC OF PAN4 AMA ARE CONVEYED TO ANY FOREIGN GOV5 ERNMENT-OWNED ENTITY.

6 (a) LIMITATION ON UNITED STATES ASSISTANCE.—

7 United States assistance may not be provided to the Re8 public of Panama for any period of time beginning after

9 the date of the enactment of this Act during which a de10 fense site or military installation, that is located within

11 the territory of the Republic of Panama and that was at

12 any time part of a defense site or military installation built

13 or formerly operated by the United States, has been con14 veyed by the Government of the Republic of Panama to

15 any foreign government-owned entity.

16 (b) OPPOSITION TO ASSISTANCE FROM INTER17 NATIONAL FINANCIAL INSTITUTIONS.—The President

18 shall instruct the United States representative to each

19 international financial institution to which the United

20 States is a member to use the voice and vote of the United

21 States to oppose any loans or other forms of assistance

22 from that institution to the Republic of Panama for any

23 period of time during which the Government of the Repub24 lic of Panama is in violation of the requirements of sub25 section (a).
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1 SEC. 4. REPORTING REQUIREMENTS.

2 (a) REPORT BY THE PRESIDENT.—Not later than 60

3 days after the date of the enactment of this Act, the Presi4 dent shall prepare and transmit to the Congress a report

5 containing a description of how Hutchison Whampoa, a

6 Chinese firm with ties to the Government of the People’s

7 Republic of China, was selected to receive a grant for man8 agement control of the Panamanian ports of Balboa and

9 San Cristobal, located at either end of the Panama Canal,

10 including whether or not the United States Government—

11 (1) had any information concerning the bid by

12 Hutchison Whampoa to receive such grant;

13 (2) provided adequate support to bids by

14 United States firms for such grant; and

15 (3) had any knowledge of ties that exist be16 tween Hutchison Whampoa and the Government of

17 the People’s Republic of China.

18 (b) REPORT BY THE SECRETARY OF DEFENSE.—Not

19 later than 60 days after the date of the enactment of this

20 Act, the Secretary of Defense shall prepare and submit

21 to the Congress a report containing—

22 (1) a description of the extent to which the con23 trol of the ports San Cristobal and Balboa in the

24 Republic of Panama by Hutchison Whampoa, a Chi25 nese firm with ties to the Government of the Peo-
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1 ple’s Republic of China, poses a threat to the secu2 rity of the United States; and

3 (2) a description of how the strategic interests

4 of the United States with respect to the Panama

5 Canal will continue to be protected after the Govern6 ment of the Republic of Panama assumes sole re7 sponsibility for the defense of the Canal and be8 comes the only entity entitled to have military

9 forces, defense sites, or military installations in Pan10 ama after December 31, 1999.

11 (c) REPORTS BY THE DIRECTOR OF CENTRAL INTEL12 LIGENCE.—Not later than March 31 of each year, the Di13 rector of Central Intelligence, in cooperation with the

14 heads of other appropriate Federal agencies, including the

15 Director of the National Security Agency, the Director of

16 the Federal Bureau of Investigation, the Secretary of De17 fense, the Secretary of the Treasury, the Secretary of

18 Commerce and the Secretary of State, shall prepare and

19 submit to the Congress a report, in both classified and

20 unclassified form, on the intelligence activities of the Peo21 ple’s Republic of China against or affecting United States

22 interests in the Republic of Panama, including a descrip23 tion of—

24 (1) the extent of political, military, and eco25 nomic espionage by the People’s Republic of China;
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1 (2) the extent of intelligence activities by the

2 People’s Republic of China designed to gain political

3 influence;

4 (3) efforts by the People’s Republic of China to

5 gain direct or indirect influence through commercial

6 or noncommercial intermediaries subject to control

7 by the People’s Republic of China, including enter8 prises controlled by the People’s Liberation Army;

9 and

10 (4) disinformation or press manipulation di11 rected against the United States.

12 (d) REPORT BY THE DIRECTOR OF THE OFFICE OF

13 NATIONAL DRUG CONTROL POLICY.—Not later than 60

14 days after the date of the enactment of this Act, the Direc15 tor of the Office of National Drug Control Policy shall

16 prepare and submit to the Congress a report on the utility

17 of maintaining a military presence in the Republic of Pan18 ama for interdicting illegal drugs.

19 SEC. 5. RENEGOTIATION OF THE PANAMA CANAL TREATY.

20 (a) RENEGOTIATION OF EXISTING TREATIES; NEGO21 TIATION OF NEW TREATY.—The President is authorized

22 and directed to confer with the Government of the Repub23 lic of Panama to renegotiate the terms of the Panama

24 Canal Treaty and the Treaty Concerning the Neutrality

25 and Operation of the Panama Canal, or to negotiate a new
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1 agreement to supersede the such Treaties, for the purpose

2 of providing for the security of the Canal into the 21st

3 Century.

4 (b) SENSE OF THE CONGRESS.—It is the sense of

5 the Congress that any negotiations conducted under sub6 section (a) should include the following:

7 (1) A ban on foreign government investment in,

8 or management of, the Panama Canal and related

9 projects or other infrastructure projects related to

10 transit across the isthmus of Panama or through

11 Panamanian territory.

12 (2) The right to a continuing United States

13 military presence in Panama to actively cooperate

14 with Panama in the defense of the Panama Canal.

15 (3) A continuing United States presence in

16 Panama to actively cooperate with Panama in the

17 interdiction and eradication of illegal drug traf18 ficking through the territory of Panama or adjacent

19 areas.

20 (4) The right to control or prohibit the use of

21 the Panama Canal by hostile powers, terrorist

22 states, or criminal groups, by redefining the terms

23 of the 1977 Treaty Concerning the Neutrality and

24 Operation of the Panama Canal to apply only to its
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1 peaceful, non-belligerent use by states or entities

2 other than the United States and Panama.

3 SEC. 6. DEFINITIONS.

4 As used in this Act:

5 (1) PANAMA CANAL TREATY.—The term ‘‘Pan6 ama Canal Treaty’’ means the Panama Canal Trea7 ty between the United States and the Republic of

8 Panama, signed at Washington on September 7,

9 1977 (33 UST 39).

10 (2) TREATY CONCERNING THE PERMANENT

11 NEUTRALITY AND OPERATION OF THE PANAMA

12 CANAL.—The term ‘‘Treaty Concerning the Perma13 nent Neutrality and Operation of the Panama

14 Canal’’ means the Treaty Concerning the Permanent

15 Neutrality and Operation of the Panama Canal be16 tween the United States and the Republic of Pan17 ama, signed at Washington on September 7, 1977

18 (33 UST 1).

19 (3) UNITED STATES ASSISTANCE.—The term

20 ‘‘United States assistance’’ means—

21 (A) assistance under part I of the Foreign

22 Assistance Act of 1961 (22 U.S.C. 2151 et

23 seq.) (including programs under title IV of

24 chapter 2 of such part; relating to the Overseas

25 Private Investment Corporation), except that
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1 such term does not include humanitarian assist2 ance;

3 (B) assistance under chapter 2 of part II

4 of the Foreign Assistance Act of 1961 (22

5 U.S.C. 2311 et seq.; relating to military assist6 ance), including the transfer of excess defense

7 articles under section 516 of such Act;

8 (C) assistance under chapter 5 of part II

9 of the Foreign Assistance Act of 1961 (22

10 U.S.C. 2347 et seq.; relating to international

11 military education and training);

12 (D) assistance under the ‘‘Foreign Military

13 Financing Program’’ under section 23 of the

14 Arms Export Control Act (22 U.S.C. 2763);

15 (E) the transfer of defense articles, defense

16 services, or defense and construction services

17 under Arms Export Control Act (22 U.S.C.

18 2751 et seq.), including defense articles and de19 fense services licensed or approved for export

20 under section 38 of such Act; or

21 (F) financing under the Export-Import

22 Bank Act of 1945.

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