US President-elect Donald Trump has sparked controversy by suggesting that his administration may seek to reclaim control of the Panama Canal, criticizing the fees charged to ships passing through the vital waterway. In a rally in Arizona on Sunday, Trump described the fees as “ridiculous” and claimed that the United States had “foolishly” handed over control of the canal to Panama.
“We’re being ripped off at the Panama Canal,” Trump said, adding that if Panama did not follow the principles outlined in the agreement, the US would demand the canal’s return. “If the principles, both moral and legal, of this magnanimous gesture of giving are not followed, then we will demand that the Panama Canal be returned to the United States of America, in full, quickly and without question,” he threatened. “I’m not going to stand for it. So to the officials of Panama, please be guided accordingly.”
The Panama Canal, a critical passageway for commercial and military vessels, was built by the United States in the early 1900s. However, under the leadership of President Jimmy Carter, the US formally handed over control of the canal to Panama on December 31, 1999, through a treaty signed in 1977.
Trump’s comments come amid ongoing discussions about the rising fees at the Panama Canal, which were introduced in response to the canal’s operational challenges during the 2023 Central American droughts. The droughts severely impacted the canal’s reservoir levels, leading to a reduction in the number of daily slots for ships. As a result, the fees for reserving crossing slots were increased.
While conditions improved later in the year, with weather returning to normal, the Panama Canal Authority announced that transit fees would likely continue to rise in 2024 due to ongoing operational costs.
Panama Responds:
In reaction to Trump’s remarks, Panama’s President Jose Raul Mulino quickly responded with a video statement defending Panama’s sovereignty over the canal. Mulino, without directly mentioning Trump, reaffirmed Panama’s ownership of the canal, saying, “Every square meter of the canal belongs to Panama and will continue to belong.”
Addressing the increased fees, Mulino explained that they were set by experts, based on operational costs, supply and demand, and other relevant factors. He also highlighted that Panama had invested in expanding the canal to accommodate more ships and that the higher fees were necessary to fund further improvements to the infrastructure.
Mulino also pointed out that while Panamanians may have differing opinions on various issues, they are united in their commitment to the canal’s sovereignty. “When it comes to our canal, and our sovereignty, we will all unite under our Panamanian flag,” he asserted.
Strategic Importance of the Canal:
The Panama Canal, which facilitates the transit of goods and military vessels between the Atlantic and Pacific Oceans, is crucial for both Panama’s economy and global trade. It generates approximately one-fifth of Panama’s annual revenue, making it a central piece of the nation’s economic structure. The canal is also of strategic importance to the United States, as it plays a key role in military and commercial logistics.
Despite Trump’s remarks, it appears unlikely that Panama would agree to any renegotiation of control over the canal, given its significance and the longstanding agreement made between the two nations.
Looking Ahead:
With the debate over the Panama Canal’s control heating up, attention is likely to remain focused on the US-Panama relationship, particularly in the context of rising global trade and continued concerns over the economic challenges facing both nations. The future of the canal and its fees could continue to be a topic of contention in US political discourse, especially as Trump prepares for his administration to take office.
Sources By Agencies
