WASHINGTON (AP) -- The handoff of the Panama Canal to Panama should
                  mark a new relationship emphasizing diplomatic and commercial ties over military
                  issues, the president of Panama told President Bill Clinton on Tuesday.

                  The two leaders also discussed antidrug efforts and environmental issues in
                  the Oval Office meeting.

                  President Mireya Moscoso urged Clinton to attend a ceremony in Panama in
                  December to "solemnize" the transfer of the canal from U.S. to Panamanian
                  control.

                  Moscoso said such a ceremony would underscore the beginning of a new
                  relationship between the dominant power in the hemisphere and Panama, as
                  well as the other nations of Latin America.

                  Moscoso stressed that this new relationship should emphasize diplomatic
                  and commercial ties. She has opposed proposals to establish a new U.S.
                  drug-fighting base in Panama.

                  "We don't want any more bases in our country," she said. "That wasn't on
                  the  agenda. It's not on the agenda of our country."

                  She said Clinton said he would consider attending the ceremony but offered
                  no assurances. White House officials said it was unlikely Clinton would be
                  able to attend.

                  White House spokesman Joe Lockhart said the two leaders discussed
                  "joint efforts on counternarcotics" as well as environmental issues. The
                  Panamanians are pressing the United States about hazards around the
                  bases its soldiers and sailors are leaving.

                  "The president made the point clearly that we've met our treaty obligations
                  of what was practicable to do as far as cleanup. Most of the cleanup has
                  been done," Lockhart said.

                  "There are some areas that are impossible to get to as far as moving forward,
                  but he did say that we wanted to continue to remain engaged and work with
                  Panama in an effort to deal with this issue."

                  Under a treaty signed in 1977, Panama takes control of the canal at midnight
                  December 31.  The strategic significance of the man-made waterway has
                  diminished, but the U.S. bases that control it have begun to play a significant
                  role in the war against drugs.

                  Panama rejected the continued presence of the U.S. military. While
                  Moscoso guaranteed the security of the canal, she said new U.S. anti-drug
                  bases in Panama were not an option.

                  The U.S. presence in Panama is a sensitive topic for Moscoso, the widow of
                  a nationalist mayor, Arnulfo Arias, whose fight against the American
                  influence in their country became legend in Latin America.

                    Copyright 1999 The Associated Press.