Hunger creeps into Panama's glittering capital. Country's cash crisis pushes thousands of new poor into food lines

Several hours before the sun rises over Panama these days, a line of people forms outside a hilltop church in the barrio of San Miguelito. Mere shadows in the predawn darkness, these wives and workers are not waiting for the mass. They are waiting for free food. On Wednesday morning, more than 2,000 poor Panamanians descended on the church to pick up rice, beans, milk, and bananas being distributed by a church group known as C'aritas.

Two hours later, however, more than 1,300 left with nothing.

``I haven't gotten food for three days'' said Mariela de Avila, a young mother who lost her food card in a fight that broke out among impatient line-breakers. Rocking her two-month-old child in her arms, Mrs. de Avila says Panama's current cash crunch has claimed her ironing job and her husband's construction job.

``Now,'' she says ``I'm worried about the baby.''

Hunger is creeping into this glittering capital as the battle to overthrow Gen. Manuel Antonio Noriega turns into a protracted economic war.

It is not a hunger borne of relentless poverty and unemployment, as in Nicaragua and El Salvador. But in Panama, where foreign banking and the US dollar have buoyed a relatively affluent society, thousands of people are being pushed into food lines by a three-week-old cash crisis and a four-day-old general strike.

``It was an outrageous amount of people that arrived here,'' said San Miguelito church worker Laura Tinz'on, explaining that 250 people showed up on Monday. A month ago, only 25 came regularly.

``Many of these people have checks but can't cash them,'' Ms. Tinz'on says. ``Others have jobs but have been fired.''

The Roman Catholic Church, notable for its low-key neutrality in the conflict, started channeling food donations through C'aritas soon after the cash crisis began three weeks ago.

The crunch was sparked when President-in-hiding Eric Arturo Delvalle and his lawyers got a US federal judge to freeze an estimated $50 million in Panamanian government funds held in US banks. C'aritas' food packages now reach close to 30,000 people.

Since March 3, nobody has been able to cash a check or withdraw a penny from the more than 100 local and foreign banks here.

With most supermarkets and donor businesses joining the strike, C'aritas volunteer Maria Luisa de Hoffman says, ``The demand goes up and the bags get smaller.''

Ray Thompson, a furniture mover of Caribbean descent, is part of this growing demand. Pulling out a wrinkled check for $30, he says: ``I've been carrying this around for three weeks, but no one will cash it. Now I have to do just about anything to get food for my wife and kid at home. They're hungry.''

The US continues to starve the Panamanian government of cash in its effort to force the departure of Noriega, a former US ally now under indictment on drug trafficking charges in two US courts. Besides supporting the opposition call to block Panamanian assets, the US has also withdrawn trade preferences and withheld its $6.5 million monthly payment for use of the Panama Canal.

Banks here normally rely on the government-run National Bank to act as a clearinghouse for checks. But deprived of the $50 million in US banks, the National Bank is unable to perform that function.

General Noriega, now unable to pay his 145,000 public employees, reportedly tried to avoid the cash shortage by telling his creditors to deposit their money in a secret account in Chase Manhattan Bank in New York. Opposition leaders caught wind of the plan, however, and blocked the end run, according to ABC News.

In a recent resolution, the US Senate assured opposition leaders it would pour in the money necessary to reinvigorate the economy once Noriega leaves. Some sources say the US could flood Panama with $400 million to $500 million the day Noriega leaves.

But despite Noriega's conditional offer to resign on Monday evening, he has given no clear signs that he is willing to surrender power - at least not soon. Since quelling an attempted revolt last week he has purged his officer corps and tighten his grip on power.

In the meantime, daily economic problems have intensified for the average Panamanian. Even government officials admit that the general strike has shut down practically all industry and commerce.

Panamanians with cash to spare stored up on canned goods over the weekend in preparation for the indefinite strike. On Tuesday, car owners piled up behind gas pumps, topping off their tanks as rumors spread that gas stations would joine the strike on Wednesday.

Many employers are giving their workers an early Easter holiday. This year, however, many families are foregoing the traditional beach vacation as they hoard what little cash they have.

Several smaller old-time enterprises folded their businesses due to the cash crisis.

As store owners board up their shops and beef up their security, the only thriving businesses in Panama these days are plywood distributers, private security agencies, and the few hotels favored by the flock of foreign journalists.

But the most worrisome problem is food. Even people with cash can't buy goods in closed supermarkets or can't find the necessary items on the shelves of the smaller markets that remain open.

At a church in Chorrillo, a seaside barrio of rotting, 85-year-old tenement buildings, originally constructed for diggers of the Panama Canal, 700 poor Panamanians line up for soup at noon every day. A month ago, only 150 showed up.

Says helper Ricardo Gonzalez: ``If this continues much longer we'll never have enough to feed everybody.''