Talks with Panamanian leader Manuel Noriega have broken down, and the Reagan administration, divided about whether to drop drug charges against him, recalled State Department official Michael Kozak for further consultations Friday.
Amid reports a tentative agreement had been reached with Nor-iega, a State Department official said, "There is no deal."An official said, "That report was wrong, and it came from somebody who was opposed to making the deal in order to stop it."
Kozak, deputy assistant secretary of state for inter-American affairs, had been in Panama for three weeks trying to put together an arrangement that would involve Noriega stepping down in return for the United States dropping the drug charges against him.
Reports from Panama this week said a deal would be announced Friday or Monday, but the recall of Ko-zak suggested there was a serious complication.
Vice President George Bush, now virtually the Republican nominee for president, has said he is opposed to the idea of dropping the charges, and privately urged the administration to break off negotiations.
Kozak, who has been negotiating with representatives of Noriega, was called back to Washington Friday for talks with Secretary of State George Shultz and President Reagan at the White House.
Noriega's lawyer, Raymond Ta-kiff, who returned to Miami Thursday after spending 12 days in Panama, said, "Based on the conversation I have had with a high-ranking Panamanian diplomat 10 minutes ago, there is no deal."
The Kozak negotiations have been shrouded in secrecy, but leaks from both sides have indicated that Nor-iega has turned out to be a difficult negotiator, insisting that the charges against him be dropped, and, according to reports from Panamanian government sources, and that U.S. ambassador Arthur Davis to step down.
The talks have been carried out against the background of what the State Department calls "increasing harassment" of the U.S. embassy, including the publication in a government-controlled newspaper of the names and pictures of U.S. embassy employees described as "enemies."
"The process will continue," Red-man said. "There has been no change in the process.
The State Department said Friday that economic sanctions were contiuning to have their impact, but one of the key planners in the U.S. financial squeeze said that they could not accomplish the task of removing Noriega from office.