PANAMA CITY — President José Raúl Mulino of Panama has openly refuted claims made by the U.S. State Department regarding an agreement that would allow U.S. warships to pass through the Panama Canal at no cost. During a press conference on Thursday, Mulino expressed his astonishment at the U.S. statement, which suggested that such a deal had been established.
Mulino recounted a conversation with U.S. Secretary of Defense Pete Hegseth on Wednesday, during which he indicated that he lacked the authority to set or eliminate transit fees for the canal. He stated, “I completely reject that statement yesterday,” and has instructed Panama’s ambassador in Washington to contest the claims made by the State Department. The president mentioned that he was scheduled to engage in conversation with U.S. President Donald Trump on Friday.
On the previous evening, the U.S. State Department announced that U.S. government vessels could now transit the Panama Canal without incurring any fees, claiming that this change would save the U.S. government millions annually. In response, the Panama Canal Authority issued a brief statement clarifying that there had been no modifications to the existing fee structure.
The Panamanian president highlighted the inaccuracy of the U.S. statement, saying, “They’re making an important, institutional statement based on a falsity. And that’s intolerable.” In parallel, U.S. Secretary of State Marco Rubio, who had met with Mulino and canal officials earlier in the week, addressed the matter from the Dominican Republic. He reaffirmed his understanding of their discussions but acknowledged Panama’s legal processes. Rubio emphasized the U.S. treaty commitment to defend the canal should it come under threat, finding it unreasonable to impose fees for transiting an area that the U.S. is bound to protect.
Additionally, Rubio conveyed a message from Trump, expressing concern over China’s growing presence in the canal region, which Trump considers a potential violation of the treaty that allowed the U.S. to relinquish control of the waterway to Panama in 1999. This treaty stipulates the canal’s permanent neutrality.
Canal officials mentioned they could explore the possibility of ensuring U.S. warships receive priority when traversing the canal but did not indicate any plans to eliminate fees. Meanwhile, Mulino reiterated his upcoming conversation with Trump regarding these developments.
Since 1998, U.S. naval vessels have made 994 crossings of the Panama Canal, accounting for merely 0.3% of total traffic during this timeframe. For these transits, the canal authorities have collected $25.4 million in fees. Fees imposed on U.S. ships, as well as those from other nations, are determined by the displacement tonnage of the vessels, which differs from the measure used for commercial ships.
On Thursday, Mulino pointed out that both the constitution of Panama and the laws governing the Canal Authority clarify that waiving fees is not permissible, stating, “It’s a constitutional limitation.”
