Title 3--The President Panama The Government of Panama (GOP) continues to demonstrate its willing- ness to combat transnational drug trafficking. The GOP seized significant amounts of illicit drugs in 1999, despite apparent changes in trafficking routes. The new Mireya Moscoso administration has demonstrated its com- mitment to combat drug trafficking, money laundering, and other transnational crimes. Immediately after taking office, the new administra- tion set up an anti-corruption unit in the Ministry of Economy and Fi- nance. Panama's law enforcement agencies continue to maintain excellent relations with their U.S. counterparts. Panama is a maior transshipment point for illicit drugs smuggled from Colombia. Cocaine is stockpiled in Panama prior to being repackaged for passage to the United States and Europe. Panama's location, largely unpatrolled coastlines, advanced infrastructure, underdeveloped iudicial system, and well-developed financial services sector make it a crossroads for transnational crime, such as drug trafficking, money laundering, illicit arms sales and alien smuggling. According to USG statistics, GOP agencies seized 2,576 kilograms of cocaine, 1,558 kilograms of marijuana, 46 kilo- grams of heroin, and 600 liters of acetic anhydride; they also made 131 ar- rests for international drug-related offenses in 1999. The GOP continued to implement its own national counter-drug plan, the "National Drug Strategy 1996-2001." Panama also made significant progress in implementing its comprehensive chemical control program. The highest U.S. priorities in the coming year will be signing a full six part bilateral counter-drug maritime agreement, expanding anti-money laundering legislation, increasing efforts to control the Black Market Peso Exchange, and improving prosecutions of money launderers and drug traf- fickers. Other U.S. priorities in Panama include: supporting the GOP's ef- forts to build a highly-professional, interagency, counter-drug task force; developing the capabilities to control sea lanes, rivers, island and coastal regions, and the Canal area; and limiting cross-border criminal influence. With the seriousness and commitment of the new Moscoso administration, the USG is hopeful that there will be measurable progress in these areas in 2000. Paraguay Paraguay is a major drug-transit country for significant amounts of large- ly Bolivian cocaine and is also a major money-laundering center in Latin America (although it remains unclear what portion of money laundering can be attributed to drug trafficking). USG experts estimate that between 15 and 30 metric tons of cocaine may transit Paraguay annually en route to Argentina, Brazil, the United States and Europe. Of this estimated amount, only 95 kilos of cocaine were seized in 1999; moreover, only 211 arrests of low-level marijuana and cocaine traf- fickers were effected, mostly prior to April 1999. Paraguay is a source country for high-quality marijuana. Although none of it enters the United States, the Government of Paraguay (GOP) seized record amounts of mari- juana and eradicated 900 of the estimated 2,500 hectares of marijuana fields. In July 1999, a new penal code was enacted that criminalizes conspiracy. This will allow the prosecution of those who benefit from criminal activity, 378
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