Despite undercover collaboration with US president Ronald Reagan on his Contra war in Nicaragua (including the Iran–Contra affair), to deliver arms and drugs by airplane, relations between the United States and Panama worsened in the 1980s. In response to a domestic political crisis and an attack on the US embassy, the US froze economic and military aid to Panama in the summer of 1987. Tensions sharpened in February 1988 when Noriega was indicted in US courts for drug-trafficking. In April 1988, Reagan invoked the International Emergency Economic Powers Act, freezing Panamanian Government assets in US banks, withholding fees for using the canal, and prohibiting payments by US agencies, firms, and individuals to the Noriega regime. The country went into turmoil.
despite undercover collaboration with us president ronald reagan on his contra war in nicaragua (including the iran–contra affair) to deliver arms and drugs by airplane relations between the united states and panama worsened in the 1980s in response to a domestic political crisis and an attack on the us embassy the us froze economic and military aid to panama in the summer of 1987 tensions sharpened in february 1988 when noriega was indicted in us courts for drug-trafficking in april 1988 reagan invoked the international emergency economic powers act freezing panamanian government assets in us banks withholding fees for using the canal and prohibiting payments by us agencies firms and individuals to the noriega regime the country went into turmoil