US to Take Control Over Panama Canal
In December 2024, President Donald Trump declared his intention to reclaim U.S. control over the Panama Canal, citing “exorbitant” fees imposed on American shipping and naval vessels. He emphasised that this “complete rip-off” would cease upon his assumption of office.
Panama’s President José Raúl Mulino responded firmly, asserting that “every square metre” of the canal and its surrounding area belongs to Panama and emphasising that the nation’s sovereignty and dependence are non-negotiable.
The Panama Canal, a 51-mile (82 km) waterway connecting the Atlantic and Pacific Oceans, was under U.S. control until 1999, following a gradual transfer process initiated by treaties signed in 1977. The canal is vital for global trade, accommodating approximately 14,000 ships annually, including container ships and military vessels.
The U.S. has expressed concerns over increased Chinese influence in Panama, particularly regarding Chinese investments in canal infrastructure. U.S. Secretary of State Marco Rubio has urged Panama to reduce Chinese involvement, warning of potential American action if these concerns are not addressed.
Additionally, Republican senators are exploring the possibility of reclaiming control over the canal, alleging that Panama has violated the 1977 Panama Cal Treaty by allowing Iranian oil transfers and increasing Chinese influence through the Belt and Road Initiative. Senate Commerce, Science, and Technology Chairman Ted Cruz has criticised Panama for these actions, emphasising the strategic importance of the canal to U.S. interests.
These developments have heightened diplomatic tensions between the U.S. and Panama with significant implications for international trade and geopolitical dynamics.