Why does Trump want the US to control the Panama Canal?

US President-elect Donald Trump has demanded the return of the Panama Canal to US control or a significant reduction in the fees charged to American vessels. 

Mr. Trump even posted a picture of the US flag over a waterway, leaving little to the imagination.

US-flag-over-the-Panama-Canal
© US President-elect Donald Trump

Speaking at Turning Point USA’s AmericaFest in Arizona, Mr. Trump lambasted Panama for charging what he described as ‘exorbitant fees’ and ‘ripping off’ the United States, igniting a diplomatic row with the Central American nation.

He stated, ‘The fees being charged by Panama are ridiculous, especially knowing the extraordinary generosity that has been bestowed to Panama by the US. This complete ‘rip-off’ of our country will immediately stop.’ 

The President-elect further said, ‘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 us, in full, quickly and without question.’

Aside from the fees charged by Panama, Mr. Trump noted that he did not want the crucial canal to fall into the wrong hands. 

Why is the Panama Canal so important, and what is the US claim over the waterway?

The artificial waterway, about 50 nautical miles long, saves a distance of 8000 nautical miles in travel between the Atlantic and Pacific Oceans.

panama-canal
© Stan Shebs, CC BY-SA 3.0

The canal, which handles about 5% of global maritime traffic, is vital for Panama’s economy and international trade, allowing ships to bypass the long and perilous route around South America.

In a social media post, Mr. Trump highlighted its significance: ‘ A secure Panama Canal is crucial for US Commerce, and rapid deployment of the Navy, from the Atlantic to the Pacific, drastically cuts shipping times to US ports. The United States is the Number One user of the Canal, with over 70 percent of all transits heading to, or from, US ports.’

The Panama Canal was completed by the United States in 1914 and was under US control until 1999 when it was handed over to Panama as per the Torrijos-Carter Treaties. 

According to the US State Department’s website, the ‘Torrijos-Carter Treaties allowed the United States to defend itself from charges of imperialism made by Soviet-aligned states.’ 

This historical transfer has been a point of national pride for Panama, symbolizing its independence and economic self-determination. 

Mr. Trump’s comments have reignited debates about past US interventions in Latin America and the implications of revisiting historical treaties.

Panama responds

The response from Panama was swift and stern. 

President José Raúl Mulino issued a video statement emphasizing Panama’s sovereignty over the canal, rebuffing Mr. Trump’s remarks.

‘Every square meter of the Panama Canal and the surrounding area belongs to Panama and will continue belonging to Panama,’ Mr. Mulino stated, underlining that the canal’s tariffs are not decided arbitrarily but are based on operational necessities and market dynamics.

Mr. Mulino’s response has been echoed across Panamanian political spectrums, with various officials and citizens rallying around their country’s sovereignty.