Teddy Roosevelt once declared the Panama Canal “one of the feats to which the people of this republic will look back with the highest pride.” More than a century later, Donald Trump is threatening to take back the waterway for the same republic.
The president-elect is decrying increased fees Panama has imposed to use the waterway linking the Atlantic and Pacific oceans. He says if things don’t change after he takes office next month, “We will demand that the Panama Canal be returned to the United States of America, in full, quickly and without question.”
Donald Trump suggested Sunday that his new administration could try to regain control of the Panama Canal that the United States “foolishly” ceded to its Central American ally, contending that shippers are charged “ridiculous” fees to pass through the vital transportation channel linking the Atlantic and Pacific Oceans.
Trump has long threatened allies with punitive action in hopes of winning concessions. But experts in both countries are clear: Unless he goes to war with Panama, Trump can’t reassert control over a canal the U.S. agreed to cede in the 1970s.
Here’s a look at how we got here:
What is the canal?
It is a man-made waterway that uses a series of locks and reservoirs over 51 miles (82 kilometers) to cut through the middle of Panama and connect the Atlantic and Pacific. It spares ships having to go an additional roughly 7,000 miles (more than 11,000 kilometers) to sail around Cape Horn at South America’s southern tip.
The U.S. International Trade Administration says the canal saves American business interests “considerable time and fuel costs” and enables faster delivery of goods, which is “particularly significant for time sensitive cargoes, perishable goods, and industries with just-in-time supply chains.”
Who built it?
An effort to establish a canal through Panama led by Ferdinand de Lesseps, who built Egypt’s Suez Canal, began in 1880 but progressed little over nine years before going bankrupt.
Malaria, yellow fever and other tropical diseases devastated a workforce already struggling with especially dangerous terrain and harsh working conditions in the jungle, eventually costing more than 20,000 lives, by some estimates.
Panama was then a province of Colombia, which refused to ratify a subsequent 1901 treaty licensing U.S. interests to build the canal. Roosevelt responded by dispatching U.S. warships to Panama’s Atlantic and Pacific coasts. The U.S. also prewrote a constitution that would be ready after Panamanian independence, giving American forces “the right to intervene in any part of Panama, to re-establish public peace and constitutional order.”
In part because Colombian troops were unable to traverse harsh jungles, Panama declared an effectively bloodless independence within hours in November 1903. It soon signed a treaty allowing a U.S.-led team to begin construction.
Some 5,600 workers died later during the U.S.-led construction project, according to one study.
Why doesn’t the US control the canal anymore?
The waterway opened in 1914, but almost immediately some Panamanians began questioning the validity of U.S. control, leading to what became known in the country as the “generational struggle” to take it over.
The U.S. abrogated its right to intervene in Panama in the 1930s. By the 1970s, with its administrative costs sharply increasing, Washington spent years negotiating with Panama to cede control of the waterway.
The Carter administration worked with the government of Omar Torrijos. The two sides eventually decided that their best chance for ratification was to submit two treaties to the U.S. Senate, the “Permanent Neutrality Treaty” and the “Panama Canal Treaty.”
The first, which continues in perpetuity, gives the U.S. the right to act to ensure the canal remains open and secure. The second stated that the U.S. would turn over the canal to Panama on Dec. 31, 1999, and was terminated then.
Both were signed in 1977 and ratified the following year. The agreements held even after 1989, when President George H.W. Bush invaded Panama to remove Panamanian leader Manuel Noriega.
In the late 1970s, as the handover treaties were being discussed and ratified, polls found that about half of Americans opposed the decision to cede canal control to Panama. However, by the time ownership actually changed in 1999, public opinion had shifted, with about half of Americans in favor.
What’s happened since then?
Administration of the canal has been more efficient under Panama than during the U.S. era, with traffic increasing 17% between fiscal years 1999 and 2004. Panama’s voters approved a 2006 referendum authorizing a major expansion of the canal to accommodate larger modern cargo ships. The expansion took until 2016 and cost more than $5.2 billion.
Panamanian President José Raúl Mulino said in a video Sunday that “every square meter of the canal belongs to Panama and will continue to.” He added that, while his country’s people are divided on some key issues, “when it comes to our canal, and our sovereignty, we will all unite under our Panamanian flag.”
Shipping prices have increased because of droughts last year affecting the canal locks, forcing Panama to drastically cut shipping traffic through the canal and raise rates to use it. Though the rains have mostly returned, Panama says future fee increases might be necessary as it undertakes improvements to accommodate modern shipping needs.
Mulino said fees to use the canal are “not set on a whim.”
Jorge Luis Quijano, who served as the waterway’s administrator from 2014 to 2019, said all canal users are subject to the same fees, though they vary by ship size and other factors.
“I can accept that the canal’s customers may complain about any price increase,” Quijano said. “But that does not give them reason to consider taking it back.”
Why has Trump raised this?
The president-elect says the U.S. is getting “ripped off” and “I’m not going to stand for it.”
“It was given to Panama and to the people of Panama, but it has provisions — you’ve got to treat us fairly. And they haven’t treated us fairly,” Trump said of the 1977 treaty that he said “foolishly” gave the canal away.
The neutrality treaty does give the U.S. the right to act if the canal’s operation is threatened due to military conflict — but not to reassert control.
“There’s no clause of any kind in the neutrality agreement that allows for the taking back of the canal,” Quijano said. “Legally, there’s no way, under normal circumstances, to recover territory that was used previously.”
Trump, meanwhile, hasn’t said how he might make good on his threat.
“There’s very little wiggle room, absent a second U.S. invasion of Panama, to retake control of the Panama Canal in practical terms,” said Benjamin Gedan, director of the Latin America Program at the Woodrow Wilson International Center for Scholars in Washington.
Gedan said Trump’s stance is especially baffling given that Mulino is a pro-business conservative who has “made lots of other overtures to show that he would prefer a special relationship with the United States.” He also noted that Panama in recent years has moved closer to China, meaning the U.S. has strategic reasons to keep its relationship with the Central American nation friendly.
Panama is also a U.S. partner on stopping illegal immigration from South America — perhaps Trump’s biggest policy priority.
“If you’re going to pick a fight with Panama on an issue,” Gedan said, “you could not find a worse one than the canal.”
