U.S. President-elect Mr. Trump, Panama Canal and the World Trade—An Analysis

The Panama Canal, a 51-mile artificial waterway connecting the Atlantic and Pacific Oceans, has been a cornerstone of global maritime trade since its completion in 1914. Originally constructed and operated by the United States, control of the canal was transferred to Panama on December 31, 1999, following the Torrijos-Carter Treaties signed in 1977. This transfer marked the end of an era in which the U.S. maintained sovereignty over the canal and its surrounding zone, a period characterized by significant geopolitical influence in the region.

In recent statements, President-elect Donald Trump has signaled a desire to revisit this arrangement. He has criticized Panama for imposing "ridiculous" fees on U.S. vessels and has expressed concerns about the canal's management, suggesting that it may be under undue influence from foreign powers, particularly China. Trump's rhetoric includes the possibility of reclaiming control over the canal, even hinting at the use of military force if necessary. These assertions have sparked a wave of nationalist sentiment in Panama, with citizens and officials alike vehemently opposing any infringement on their sovereignty.

• Historical Context

The U.S. involvement in the Panama Canal dates back to the early 20th century when it orchestrated Panama's independence from Colombia to facilitate the canal's construction. The canal served not only as a vital commercial artery but also as a strategic military asset, allowing for the rapid movement of naval forces between oceans. However, decades of Panamanian nationalism and anti-American sentiment culminated in the 1977 treaties, leading to the eventual transfer of control.

• Strategic Importance

The canal remains a critical conduit for international maritime trade, with approximately 5% of global shipping traffic passing through it. For the United States, it is particularly significant, facilitating the movement of goods between the East and West coasts and serving as a strategic military passage. Trump's concerns about foreign influence, especially from China, stem from the fact that Chinese companies have secured significant investments in ports and infrastructure projects in the region, potentially extending their geopolitical reach.

• Economic Considerations

Trump's critique of the "ridiculous" fees imposed by Panama touches on broader economic concerns. The Panama Canal Authority sets transit fees based on vessel size, type, and cargo, which are vital for Panama's economy, contributing significantly to its GDP. However, from the U.S. perspective, these fees add to shipping costs, impacting trade competitiveness. Trump's stance reflects a broader agenda to renegotiate terms he perceives as unfavorable to the U.S., consistent with his "America First" policy.

• Panama's Response

Panamanian officials have responded firmly to Trump's statements. President José Raúl Mulino asserted that "every square meter of the Panama Canal and its adjacent zones is part of Panama, and it will continue to be." He emphasized that the canal's sovereignty is non-negotiable and that its management is free from foreign control. These declarations underscore Panama's national pride and the symbolic importance of the canal as a testament to its sovereignty and independence.

• International Implications

Trump's rhetoric has broader implications for international relations. Reasserting U.S. control over the canal could strain diplomatic ties not only with Panama but also with other Latin American countries, potentially rekindling historical resentments over U.S. interventionism. Moreover, such a move could escalate tensions with China, given its economic interests in the region, and complicate relationships with allies who view the canal as a neutral international waterway.

• Legal and Ethical Considerations

The Torrijos-Carter Treaties, ratified by both the U.S. and Panama, legally transferred control of the canal to Panama. Any attempt to unilaterally reclaim it would violate international law and set a concerning precedent for the abrogation of treaties. Ethically, it would undermine the principles of national sovereignty and self-determination, potentially leading to international condemnation and isolation.

In conclusion, President-elect Donald Trump's interest in the Panama Canal reflects a complex interplay of strategic, economic, and national security considerations. While the canal's importance to U.S. interests is undeniable, any efforts to alter the current status quo must be approached with careful diplomacy, respect for international law, and consideration of the broader geopolitical landscape. Unilateral actions could have far-reaching consequences, potentially destabilizing regional relations and undermining the very security objectives they aim to achieve.