A new Washington-based consulting group has hired a 72-year-old former ambassador to Panama and Paraguay in hopes of boosting its appeal around the Western Hemisphere.

Arthur H. Davis was named senior vice president for international affairs at Capitol Resources Group in April, three months after he retired from eight years of ambassadorial duties soon after the U.S. invasion of Panama last December.

Davis, a shopping center developer in Colorado until President Reagan appointed him U.S. ambassador to Paraguay in 1982, called his return to the private sector the start of "a new career -- my third."

His primary responsibilities at the fledgling consulting group are to drum up business through his contacts in Latin America and to increase the firm's credibility with U.S. government agencies, said James Nunes, CRG chairman and chief executive.

"He's familiar with the way the system works, with the way the White House and the NSC {National Security Council} operate," Nunes said. "Plus, he's known at State {Department}, known at the White House, known on the Hill as someone with experience in Latin American affairs. That brings him credibility."

Davis is somewhat of an anomaly at CRG, which Nunes, 31, and President Michael Govan, 32, founded in December after working together as partners at the Jefferson Group.

No one else in the eight-member office is older than 45, although Nunes said he is hiring another former ambassador with expertise in Latin American affairs to share the "senior statesman" role with Davis.

Their firm focuses primarily on representing foreign governments to U.S. regulators, policymakers and private companies. Nunes said he plans to hire 12 more staffers this year, and predicted that the company's revenue would exceed $1 million. CRG's targeted profit margin is 25 percent for its first year of operations, he added, about 10 percent below the industry average.

Davis came to CRG by way of his daughter, Susan Davis, who joined the firm as an associate shortly after its founding.

Since joining CRG, Arthur Davis has traveled to Argentina, Paraguay and Chile. He said the company has "established relations and {is} presenting contracts" to the governments of Paraguay and Chile, and is also cultivating contacts in Argentina, Venezuela and Panama.

Recent developments in both Eastern Europe and Western Europe, as well as Japan's growing status as an economic leader and the enormousness of the U.S. budget deficit, will mean increased competition for investment in Latin America, Davis said.

"I think it's going to be a healthy situation," he said. "You're going to see more cooperation. The whole world realizes that the United States doesn't have the money we once had." In particular, he added, Japan and West Germany are showing new interest in business operations in Latin America.

Davis declined to say how long he planned to stay with CRG, but said he liked the change after a period of working less than 35 or 40 hours a week in between the ambassadorship and his new post.

The best part about life outside the foreign service, he said, was his renewed sense of privacy and anonymity, both in the District and in Latin America.

"I love riding the Metro," he said. "I always thought it was kind of silly to drive to someone's house for a cocktail and have {security agents} jump out from a van behind you once you leave the car."