205. Memorandum From the Director of the Office of Management and Budget (McIntyre) to Multiple Recipients1
SUBJECT
- Panama Treaty Implementation
1. In accordance with decisions made by the Office of Management and Budget and approved by the President, the following organiza[Page 498]tional arrangements will apply to the implementation of the new Panama Canal Treaty.
a. Oversight of the Panama Canal Commission will be exercised by the Department of Defense through the Secretary of the Army.
b. After 1 April 1982, consideration will be given to moving oversight (lead agency) responsibility to the Department of Transportation.
c. The U.S. Administrator (Deputy Administrator after 1989) of the PCC will be a civilian.
d. The U.S. Members of the Board of Directors of the PCC will consist of representatives of the Departments of Defense, State, Treasury, Transportation and Commerce. The Board will be chaired by the representative of the agency having lead responsibility.
e. Members of the Board of Directors, the Administrator and the Deputy Administrator of the PCC will be appointed by the President.
f. The United States Government agencies’ representatives on the Board of Directors will also be members of a Washington-level interagency coordinating group. The interagency group will develop coordinated policy guidance on Canal and related issues, will coordinate matters associated with Treaty implementation, and will seek as necessary to resolve differences which may exist within the Panama Review Committee (the U.S. Ambassador to Panama, the Administrator of the Canal Commission, and the Commander of U.S. Forces in Panama). The interagency group will be co-chaired by the State and Defense representatives and will meet periodically, or at the request of any member. A member of the interagency group may designate another officer to represent his agency. The co-chairmen will keep all members informed of developments that occur between meetings. In the event that the interagency group cannot reach an agreed position on a matter involving an important U.S. interest, either of the co-chairmen may refer the matter to the appropriate agency within the Executive Office of the President.
g. The U.S. Members of the Board of Directors of the PCC will carry out their duties in conformity with coordinated policy guidance.
h. The Department of State, in consultation with the Department of Defense, will negotiate with the Government of Panama the composition of and procedures for a Consultative Committee to be established pursuant to Article III (7) of the Treaty.
2. Interim measures must be taken now to coordinate United States policy in preparation for Treaty implementation. For this purpose, the following arrangements are established:
a. Panama Canal Treaty Implementing Group. This group will serve as the forerunner of the interagency coordinating group (para. 1.f., above) and will be similarly constituted. It will seek, as necessary, [Page 499] to resolve differences that may arise out of the PRC and will provide a vehicle for Washington-level coordination of Treaty implementation matters. The co-chairmen will keep all members informed of developments that occur between meetings. The Implementing Group will have no authority to direct the Secretary of the Army to initiate or withhold policies or activities regarding the management, operation or maintenance of the Canal or the conduct of the Canal Zone Government.
b. United States-Panama Joint Review Group. The Department of State will propose to the Government of Panama the prompt establishment of a bilateral review group to serve as the precursor to the Consultative Committee to be created under Article III of the Treaty. Participation of the United States will be coordinated by the State Department in consultation with the Department of Defense.
- Source: Carter Library, National Security Affairs, Staff Material, North/South, Box 42, Pastor, Country, Panama, 1–5/79. No classification marking. Sent to Mondale, Vance, Blumenthal, Brown, Bell, Kreps, Adams, Alexander, Campbell, Jones, and Brzezinski.↩