WASHINGTON (AP) -- The U.S. military has cleaned up as much
                  unexploded ordnance as possible in Panama to comply with requirements of
                  the treaty that transfers the Panama Canal to local control December 31, the
                  State Department said Monday.

                  Panamanian officials dispute the point, arguing that decades of artillery
                  training have left behind large quantities of unexploded ordnance that have
                  rendered some areas uninhabitable.

                  Briefing reporters, Peter Romero, the State Department's top official for
                  Latin America, said the area in question is only 2 percent to 3 percent of the
                  total acreage being turned over to Panama at the end of this month or that
                  has already been delivered.

                  "We cleaned up as much as possible," Romero said. He said the parties
                  agreed that the areas that could not be cleared totally should be left in their
                  natural state.

                  "We never anticipated that these areas would be sites for hotels," he said.

                  Manfredo Amador, Panama's negotiator on the issue, said last week that the
                  cleanup effort fell short. "If they had started 10 years ago, they could have
                  cleaned up everything except perhaps some small areas," he said in Panama.

                  Amador claims the U.S. side dragged its heels and did much less than it did
                  to remove hazards at decommissioned firing ranges in Hawaii and California.

                  Three firing ranges -- Empire, Balboa West and Pina, totaling 37,300 acres
                  -- were turned over to Panama in July.

                  In contrast to a time not long ago when many thousands of U.S. troops were
                  stationed in Panama, the number as of this week was 120, Romero said.
                  Under terms of the treaty, all must be out of the country before the end of
                  the year.

                  In advance of the formal canal transfer, foreign dignitaries will assemble in
                  Panama on December 14 to celebrate the country's achieving full
                  sovereignty over its national territory for the first time since independence
                  from Colombia almost 100 years ago.

                  Heads of state from around the hemisphere have been invited, but President
                  Clinton chose not to take part. The canal transfer remains a politically
                  controversial issue, and Clinton, according to many analysts, saw little
                  political gain in going and so decided to stay home.

                  Romero said Clinton rejected the invitation against the advice of the State
                  Department.

                    Copyright 1999 The Associated Press.