Panamanian strongman Gen. Omar Torrijos, after ruling for 10 turbulent years that included negotiations of canal treaties with the United States, turned over his executive authority yesterday to a newly elected President.

Chosen by the National Assembly, itself newly elected, was Aristides Royo, 38 a lawyer who helped negotiate the historic treaties* that will remain in U.S. turnover of the Panama Canal by the end of this century.

Royo, was the personal choice of Torrijos. In orchestrating the current process of popular participation, the General has retained his key post as commander of the National Guard, Panama's armed forces, and is expected to remain the country's principal political figure.

The 505-member National Assembly of Community Representatives that chose Royo was elected Aug. 6 in nationwide balloting. Its sole constitutional function was yesterday's election of the president and the vice president, banker Ricardo dela Espriella.

The flamboyant Torrijos, 49, in a bit of calender calisthenics, arranged to have Royo's election fall on the 10th anniversary of his own coming to power in a coup.

Constitutionally, the next presidential election is not due until 1984, but it is widely expected that at some point Torrijos may seek the presidency himself through a popular mandate.

Torrijos has never stood personally for election but he won an overwhelming vote of confidence in a plebiscite last October on the treaties.

Royo is the youngest president among the dozens to rule Panama since 1903. Its independence from Colombia was triggered by intense U.S. pressures to get on with building the canal across the isthmus.

"Torrijos has never insinuated that the powers that I would have as president would be delegated to him," United Press International quoted Royo as saying. "We are in agreement that he will have the powers of commander and I will have the powers of president."

The outgoing president, Demetrio Lakas was a figurehead under the Torrijos-dictated 1972 constitution that has now been amended to give Royo strong executive authority.

One of Torrijos' most persistent American critics, Phillip Harman of Washington, said he was pleased by the election of Royo but would go on with his current efforts to thwart U.S. implementation of the canal treaties.

"Royo is a very shrewd, sophisticated lawyer who can be expected to run the country with a new low-key profile," said Harman, who nevertheless contended that left-wing advisers of Torrijos hold effective control.

Harman is a supporter of three-time president Arnulfo Arias, 77, ousted most recently in the '68 coup and until this year in U.S. exile. Torrijos permitted Arias and others in exile to return as a response to complaints during the Senate debate on the treaties that Torrijos was a human rights violator.

Torrijos' announcement last month that he would step aside was unexpected but is now thought to be part of an effort to consolidate investor confidence in what has been a shaky economy.

Royo, a former minister of education, must find a replacement for the widely respected economy minister, Nicolas Barletta, who resigned recently to take a post at the World Bank in Washington.

U.S. officials have praised Royo's administration of a broad aid program during his tour as education minister. Royo was educated in Spain and Italy and is said to speak English and French as well as Spanish and Italian.

Representing the United States at yesterday's combined election-installation were the new ambassador, Ambler Moss, Jr., and the commander of the U.S. Southern Command, Gen. Dennis McAuliffe. Also attending was an old friend of Torrijos, actor John Wayne.