Trump accused Panama of charging the US. « exorbitant tariffs » for using the canal and hinted at China’s growing influence over the crucial waterway.
The canal, built by the United States, was inaugurated in 1914. It was controlled by the US until the agreement of 1977 provided for its eventual transfer to Panama. The channel was operated jointly by both countries until the Panamanian government took full control in 1999.
In a speech to a crowd of young people in Phoenix on Sunday, Trump said that if the spirit of the agreement is not followed,« then we will demand that the Panama Canal be returned to the United States. So, to the officials of Panama, please be guided accordingly ».
The government of Panama was quick to respond to this threat. « As president, I want to express precisely that every square meter of the Panama Canal and its adjacent area is Panama, and will remain so, » said the country’s president, José Raúl Mulino, in a statement on Sunday. « Our country’s sovereignty and independence are not negotiable », he added.
History of a major commercial construction
Before the completion of the canal, ships travelling between the east and west coasts of America had to circle at the southern end of South America. This added thousands of miles and several months to their journeys.
In the early 20th century, US President Theodore Roosevelt made building a pass a priority. Th territory was then controlled by the Republic of Colombia. However, a revolt supported by the USA led to the separation of Panama and Colombia. The Republic of Panama was thus formed in 1903. The United States and the newly formed republic signed a treaty that year. It gave the United States control over a strip of 16 kilometers of land to build the canal in exchange for an economic reimbursement.
The canal was completed in 1914, consolidating the US as a technological and engineering superpower.
However, the relationship between the United States and Panama was gradually disintegrating due to disagreements over control of the canal, treatment of Panamanian workers, and questions about whether the American and Panamanian flags should fly jointly in the canal area.
These tensions reached their peak on January 9th 1964, when anti-American disturbances caused several deaths in the Channel area and the brief rupture of diplomatic relations between the two countries.
Years of negotiations to reach a more equitable agreement resulted in two treaties during the administration of President Jimmy Carter. The agreements declared the canal neutral and open to all vessels. They provided for joint control of the US and Panama until the end of 1999. Then, full control would be granted to Panama.
Current challenges
Shortly after the Panamanians retained full control of the canal in 2000, the volume of shipping quickly exceeded the capacity of the waterway. An extensive expansion project was started in 2007 and completed almost a decade later.
However, the area around the canal has suffered severe droughts. This had reduced water levels and made it difficult to operate properly. The canal authorities imposed traffic restrictions and higher fees for crossing.
Those fees seem to be part of Trump’s problem with the channel. The president-elect called them « ridiculous » and « very unfair » on Sunday.
Trump’s other claim that China seeks to exert more control over Panama and the canal zone. In 2017, Panama signed a joint statement underlining that it would not maintain any official ties with Taiwan, the autonomous democracy that the ruling Communist Party of China claims as its own territory. Since then, China’s influence in the area around the canal has grown.
In response to Trump’s statements over the weekend, the president of Panama said: « Fees are not a treat ». He also dismissed the idea of China exercising open control over the canal. « The canal has no control, either direct or indirect, by China, the European Community, the United States or any other power, » Mulino said in his statement.
Trump’s statements are the most recent example of the president-elect expressing his desire to take or invade a territory belonging to a foreign friendly power.
