U.S. Department of State Country Reports on Terrorism 2004 - Panama

Panama is a stalwart supporter of the United States in the war on terror. As the custodian of key infrastructure astride a strategic location, Panama takes the threat of terror seriously, and is taking appropriate measures.

There were no significant incidents of international terrorism in Panama in 2004.

Panama's immediate terrorism concern is incursions by Colombian narcoterrorists into Panama's remote Darien region. Following the murder of four Panamanians by narcoterrorists in 2003, Panama entered into a border security cooperation agreement with Colombia and strengthened police presence in Darien, and along the frontier. To confront challenges in the medium and longer term, Panama is taking other steps.

Panama's new antiterrorism legislation mandates severe penalties for a variety of activities in support of terrorists. Heavy caseloads, lack of expertise for complex international investigations, and extra-legal influence hinder the police and judicial system, however. Panama's security and anti-money laundering authorities have taken good advantage of US-provided training opportunities and equipment. The Government could bolster its already strong political will to combat terrorism by devoting more of its own resources to counterterrorism efforts.

Panama has increased the security of its key infrastructure and of the Panama Canal significantly. The Government has installed surveillance technology at critical points, such as the Bridge of the Americas and container ports. The Panama Canal Authority has improved its collection of information on ships that use the Canal and has modernized its incident management center. Panama has also strengthened the capabilities of its national security authorities to collect, analyze, and disseminate intelligence. Anti-money laundering authorities are extremely cooperative in preventing terror financing through Panamanian institutions.

In 2004, Panama signed an agreement with the United States under the Proliferation Security Initiative (PSI) that facilitates boarding procedures to search vesels suspected of carrying cargoes of proliferation concern. Panama also provided enhanced force protection for US warships transiting the Canal.

Shortly before leaving office in September 2004, President Moscoso pardoned four foreigners arrested in 2000 and jailed for illegal possession of explosives. The Government of Cuba alleged that the suspects were plotting to kill Fidel Castro, who was attending the Ibero-Ameri-can summit in Panama, and sought their extradition. Panama refused, on grounds that they would not be accorded a fair trial in Cuba. Upon their release, the Cuban Government suspended diplomatic relations with Panama. Relations were later restored.

Panama has a significant Muslim population, augmented recently by an influx of South Asian immigrants, that has traditionally remained apolitical and focused on business interests centered around the Colon Free Trade Zone and provincial towns. While rumors persist of ties between Panama's Muslim community and terrorist groups in the Middle East, there has been no credible evidence to support such speculation. The Panamanian Government remains cognizant of the potential threat posed by immigrants from countries associated with Islamic extremism.