U.S. bank executives predict that Panama is on the road to financial disaster if the country cannot restrain its borrowing.

Panama's foreign debt is already the highest per capita in the hemisphere at more than $1,300 for every man, woman and child. Total debt is estimated at $2.6 billion, about equal to Panama's gross national product.

U.S. banks -- notably Chase Manhattan, Citibank and Bank of America, which several years ago held major chunks of the debt -- have curtailed their lending to Panama sharply in the past two years. But Panama has continued to borrow unrestrained, as European and Japanese banks have moved into the market to take the place of American banks.

As several U.S. bankers and government officials see it, European and Japanese faith in Panama rests on the Panama Canal and the U.S. government. "They believe the United States has a security stake here, and we won't let Panama collapse," a U.S. Embassy official explained. h

"The Europeans assume the United States will back up its ally," a U.S. bank official said, "We know Congress better, and we don't put any stock in that."

An executive whose bank participated in the new 1980 lending, however, gave a different explanation for the European willingness to lend. "The American banks have been lending to Panama a long time" and have reached the limits on their exposure, he explained. "For the European and Japanese banks, this is a new market. The books are fresh, and they can take on some Panamanian debt to balance their loan portfolios.

"There is no question that Panama's debt load is high, but the Panamanians know this and have taken a number of steps to improve their budget situation," the banker said.

Panama began heavy borrowing in the early 1970s to finance ambitious development projects such as dams and hydroelectric projects, an international airport, a highway south to Colombia, a fishing port, a convention center and numerous other public works.

Some projects, such as the hydroelectric plants, have proved to be sound investments which will pay themselves off in the long run. Others have been losers from the start.

For example, the government constructed three sugar mills just in time for a downward slide in sugar prices, and a $60 million cement plant has been losing money since it began operating in 1978. The government continues operating these white elephants to provide jobs and finances them by borrowing.

Panama also has been using borrowed money to cover the growing deficit in its balance of payments, about $365 million in 1979. Prices of its imports -- primarily oil, machinery and manufactured goods -- have shot up, while its exports -- mostly bananas, sugar and shrimp -- have stagnated.

To make matters worse, Panama contracted the bulk of its debt with foreign commercial banks at high interest rates and short terms. Only 15 percent is "soft" money from international institutions. "They would rather take the more expensive money without any strings," a U.S. government official said.

In 1979, Panama carried out the first steps to restrain its spending, trimming social services.

But the initial steps have been modest. "The workers of Panama haven't gotten to the point of feeling it (budget austerity) yet, but it is coming," said Luis Anderson, secretary general of the Armed Forces Employees Union.

Anderson said the most serious cut was the elimination of an emergency employment program that paid 17,000 hard-core unemployed workers $100 a month for make-work jobs.

While the central government was trimming, however, autonomous agencies such as the sugar mills were spending more. Furthermore, skyrocketing international interest rates hiked Panama's debt service payments.

For 1980, Panama's debt service, which includes interest and repayment of principal, is estimated at about $600 million, which is more than 75 percent of its exports. Assuming Panama doesn't refinance, debt service will be up to $880 million by 1984.

Assuming that Panama won't refinance is far from realistic.