Trump Demands Panama Canal Fee Reduction or US Reacquisition

President-elect Donald Trump has called for Panama to either lower its fees for the Panama Canal or transfer control of the waterway back to the United States. He accused the Central American nation of imposing “exorbitant prices” on American commercial and naval vessels. Speaking to supporters in Arizona on Sunday, Trump stated, “The fees being charged by Panama are ridiculous, highly unfair.” He added that “This complete rip-off of our country will immediately stop,” indicating his intention to address the issue upon taking office next month. Panama’s president quickly responded to Trump’s comments, asserting that “every square metre” of the canal and its surrounding territory belongs to his country. President José Raúl Mulino emphasized that Panama’s sovereignty and independence are not open for negotiation. Trump delivered these remarks to attendees of Turning Point USA, a conservative activist organization that significantly supported his 2024 election campaign. This instance was unusual for a US leader to suggest compelling another nation to surrender territory, though he did not specify how such a move would be executed. It signals a potential shift in American foreign policy and diplomatic approaches once he assumes the presidency following his inauguration on January 20. These statements by Trump followed an earlier online post where he described the Panama Canal as a “vital national asset” for the US. On Sunday, he reiterated that if shipping rates are not reduced, “we will demand that the Panama Canal be returned to us, in full, quickly and without question.” The Panama Canal, a 51-mile (82km) waterway, traverses the Central American country, serving as the primary connection between the Atlantic and Pacific oceans. Annually, up to 14,000 ships, including container vessels transporting automobiles, natural gas, and other commodities, as well as military ships, navigate through it. Constructed in the early 1900s, the US maintained jurisdiction over the canal zone until 1977, when treaties progressively returned the land to Panama. After a period of shared oversight, Panama gained exclusive control in 1999. The United States reserved the right to use military force in defense of the canal against any threat to its neutrality, a threat that is now perceived as originating from the US itself. The neutrality treaty guarantees fair access for all nations and non-discriminatory tolls. While different shipping companies pay varying amounts for canal transit, these charges are determined by the vessel’s size and cargo load, not its country of origin. According to analysis from Lloyd’s List, a prominent shipping industry website, canal transit costs have risen over the past year due to a severe drought. The Panama Canal Authority reported that approximately 75% of the cargo passing through the waterway in the most recent fiscal year either originated from or was destined for the US. However, the actual users of the canal are ship operators and owners, rather than countries themselves. Beyond Panama, the president-elect also criticized Canada and Mexico, citing what he termed unfair trade practices. He accused both nations of facilitating the entry of drugs and immigrants into the US, though he referred to Mexican President Claudia Sheinbaum as a “wonderful woman.” Trump delivered his remarks before thousands at Turning Point’s annual conference, recognized as one of the nation’s largest gatherings for conservative activists. Turning Point dedicated substantial resources to get-out-the-vote initiatives in swing states, aiming to support Trump and other Republican candidates during the election campaign. This speech marked his first public address since Congress approved a deal this week to maintain US government operations. The agreement was reached after the removal of several provisions, including one that would have increased the country’s debt ceiling. Although Trump had previously supported raising the debt ceiling, which limits the US government’s borrowing capacity, his Sunday speech entirely bypassed this topic. Instead, he focused on recounting his election victory and emphasizing key campaign themes such as immigration, crime, and foreign trade. He did, however, address a specific topic concerning Elon Musk. “You know, they’re on a new kick,” Trump stated. “All the different hoaxes. The new one is that President Trump has ceded the presidency to Elon Musk.” He then clarified, “No, no, that’s not happening,” adding, “He’s not gonna be president.” At the conference, several speakers voiced criticism of government spending and politicians from both major parties. Nevertheless, the internal divisions within the Republican Party, which have been evident in Congress recently, were largely downplayed.