Panama City marked the 25th anniversary of the U.S. transfer of the Panama Canal on Tuesday, a significant occasion made even more poignant by the recent passing of former President Jimmy Carter, who was instrumental in the negotiation of the 1999 handover agreement.
During the celebration, Panama’s President José Raúl Mulino expressed a blend of emotions, highlighting both the joy of this landmark event and the sorrow felt with Carter’s death. He acknowledged the importance of the day, stating, “On this, such a special day … a mix of happiness for this 25th anniversary of having the canal in Panamanian hands, and the sadness we feel for the death of former President Jimmy Carter.” A moment of tribute was dedicated to Carter, who played a significant role in reaching the deal alongside former Panamanian leader Omar Torrijos.
In his remarks at the central celebration in the capital, Mulino praised the vision and integrity exhibited by these former leaders, referring to their commitment to justice. In the backdrop of this celebration, President-elect Donald Trump has voiced concerns regarding recent increases in fees imposed by Panama for the usage of the canal, connecting the Atlantic and Pacific Oceans. He has suggested that, pending any changes after he assumes office in late January, the U.S. would demand the full return of the canal “quickly and without question.”
Trump criticized the 1977 treaty, proclaiming it a “foolish” decision to relinquish control of the vital waterway. However, he has not specified how he would achieve this possible reversion. At the anniversary ceremony, Mulino did not directly address Trump’s comments but did attempt to quell worries regarding China’s influence over the canal. He asserted confidently, “There are no hands involved in the canal other than Panama’s,” ensuring that it would remain under Panamanian control indefinitely.
The agreement that facilitated the transfer consisted of two treaties: one focused on the handover and the other, which remains active indefinitely, gives the U.S. rights to intervene to ensure the canal’s operation in times of military conflict but does not entail reclaiming control. Jorge Luis Quijano, who administered the canal from 2014 to 2019, emphasized that “there’s no clause of any kind in the neutrality agreement that allows for the taking back of the canal.”
Ben Gedan, a director of the Latin America Program at the Woodrow Wilson International Center, noted that realigning control of the canal would be practically impossible without a significant military intervention. Since the handover, canal traffic has seen a substantial increase, with a reported 17% rise from fiscal years 1999 to 2004. In fact, Panamanian voters approved a pivotal referendum in 2006 that authorized a major expansion of the canal to accommodate larger vessels, a project completed in 2016 at a cost exceeding $5.2 billion.
The recent rise in shipping fees has been influenced by drought conditions affecting the canal’s operational capabilities, prompting Panama to significantly limit shipping traffic and adjust usage rates. Although rainfall patterns have largely returned to normal, Panama has indicated that further fee increases may be necessary as it continues to upgrade its capacity to meet contemporary shipping demands. Canal administrator Ricaurte Vásquez emphasized Panama’s resilience and ability to navigate challenges, including those posed by climate change and global economic fluctuations.
