The Acting Secretary of State to the Ambassador in Panama ( Hines )
530. On May 18, 1942 this Govt reached agreement with Panama for occupation and use numerous defense areas in territory under jurisdiction of latter. That agreement is still in effect and will be until 1 year after the date on which the definitive treaty of peace ending World War II becomes effective. In accordance with spirit of 1942 Agreement this Govt through consistent continuing processes has been evacuating and returning to Panama all sites the use of which has been found to be no longer essential. In meantime development new methods and weapons of warfare have made necessary formulation of long-term strategic plan for adequate security Panama Canal. War Dept has presented such a plan and has requested that this Dept consult with Panamanian authorities and request cooperation in drafting and signing new accord.
Paramount interest this Govt in relations with Panama has therefore become expeditious negotiation of new agreement based on General Treaty of 1936, provisions of which establish genuine partnership interest in maintenance and defense of Canal. This negotiation should have been independent of the 1942 Agreement. Unfortunately, however, as Emb is aware, Dr. Alfaro’s unilateral interpretation of termination clause 1942 Agreement made before Constituent Assembly in Nov 1945 and officially communicated to this Govt by note on Aug 31, 1946, which was made public in Panama, gave rise to local political difficulties which have impeded desired progress in negotiation new agreement.
Inasmuch as Panamanian viewpoint termination clause 1942 Agreement is clearly erroneous it has, because of recent developments in Panama, become most evident that Dr. Alfaro’s interpretation should have been challenged immediately; i.e., last year. Although he is now aware this Govt’s position, Dept, after carefully considering Amb’s recent advices, has decided to reiterate its instruction contained in Deptstel 499 of Sept 24 and insist that that part FonMin’s note Aug 31 regarding Panamanian interpretation 1942 Agreement must be acknowledged formally and at once, unless Dr. Alfaro wishes withdraw his note. Accordingly, please refer Deptstel 515 Oct 3 and carry out instruction.
It is regretted that possible embarrassment may result from discussions already initiated with Panamanian officials with respect to [Page 1123] interim agreement but Dept did not consider its telegram no. 490 (see Embstel 638 Oct 5)30 as authorization for negotiation of interim agreement and certainly not as authority for presenting suggestion to Panamanian Govt without prior complete clearance with State and War Depts.
Emb will appreciate that War Dept must be consulted and concur in any proposed agreement prior to its submission Panamanian authorities. That Dept has now delivered to us copies Sept 25 letter addressed to Amb by Gen Crittenberger.30a In future it is requested that copies such documents be forwarded promptly and directly to Dept in order to avoid embarrassment in relations with War Dept here.
In summary, please comply instruction contained in Deptstels 499 and 515 of Sept. 24 and Oct 3. Subsequently, make every effort enter into expeditious negotiation definitive defense sites accord without interim agreement.