Joint Statement following Discussions With President Chiari of Panama.

THE MEETINGS of the President of the Republic of Panama and the President of the United States of America during the past two days have been marked by a spirit of frankness, understanding and sincere friendship. During their talks the two Presidents discussed general relations and existing treaties between their two countries, their mutual interests in the Panama Canal, and topics of world-wide and hemispheric concern. They emphasized the close and friendly ties on which have been established a mutually advantageous association through partnership in the Panama Canal enterprise. On the conclusion of these talks, they agreed to publish the following joint communique.

They reaffirm the traditional friendship between Panama and the United States--a friendship based on their common devotion to the ideals of representative democracy, and to their determination that both nations should work as equal partners in the cause of peace, freedom, economic progress and social justice.

The Presidents recognize that their two countries are bound together by a special relationship arising from the location and operation of the Panama Canal, which has played such an important part in the history of both their countries.

The President of Panama and the President of the United States agreed upon the principle that when two friendly nations are bound by treaty provisions which are not fully satisfactory to one of the parties, arrangements should be made to permit both nations to discuss these points of dissatisfaction. Accordingly, the Presidents have agreed to appoint high level representatives to carry on such discussions. These representatives will start their work promptly.

As to some of these problems, it was agreed that a basis for their solution can now be stated. Accordingly, the two Presidents further agreed to instruct their representatives to develop measures to assist the Republic of Panama to take advantage of the commercial opportunities available through increased participation by Panamanian private enterprises in the market offered by the Canal Zone, and to solve such labor questions in the Canal Zone as equal employment opportunities, wage matters and social security coverage.

They also agreed that their representatives will arrange for the flying of Panamanian flags in an appropriate way in the Canal Zone.

In order to support the efforts of the Government of Panama to improve tax collections in order to meet better the needs of the people of Panama, President Kennedy agreed in principle to instruct his representatives to work out in conjunction with the Panamanian representatives arrangements under which the U.S. Government will withhold the income taxes of those Panamanian and non-United States citizen employees in the Zone, who are liable for such taxes under existing treaties and the Panamanian income tax law.

The President of Panama mentioned a number of other practical problems in relations between the two countries of current concern to his Government including the need of Panama for pier facilities and the two Presidents agreed that their representatives would over the coming months discuss these problems as well as others that may arise.

The Presidents reaffirmed their adherence to the principles and commitments of the Charter of Punta del Este. They agreed on the need to execute rapidly all steps necessary to make the Alliance for Progress effective; they recognized that the Alliance is a joint effort calling for development programming for effective use of national as well as external resources, institutional reforms, tax reforms, vigorous application of existing laws, and a just distribution of the fruits of national development to all sectors of the community.

The two Presidents declared that political democracy, national independence and the self-determination of peoples are the political principles which shape the national policies of Panama and the United States. Both countries are joined in a hemisphere-wide effort to accelerate economic progress and social justice.

In conclusion the two Presidents expressed their gratification at this opportunity to exchange views and to strengthen the friendly and mutually beneficial relationship which has long existed between Panama and the United States. Their meeting was a demonstration of the understanding and reciprocal cooperation of the two countries and strengthened the bonds of common interests and friendship between their respective peoples.