Panama celebrated the 25th anniversary of the US handover of the Panama Canal on Tuesday, a historic milestone overshadowed by controversial remarks from former US president Donald Trump, who has called for the waterway to be returned to American control.
The commemorations were imbued with a sense of poignancy following the death of former US President Jimmy Carter, who negotiated the 1977 treaty that led to the canal’s transfer to Panamanian hands on 31 December 1999. Carter passed away on Sunday at the age of 99.
Honouring Jimmy Carter’s legacy
Speaking at the main anniversary ceremony in Panama City, Panamanian President José Raúl Mulino reflected on the bittersweet occasion.
“Today, we celebrate a mix of emotions: happiness for this milestone of 25 years of having the canal in Panamanian hands, and sadness for the loss of former President Jimmy Carter,” Mulino said.
The ceremony included a moment of silence for Carter, whose collaboration with then-Panamanian leader Omar Torrijos laid the foundation for what Mulino described as “the vision and nobility to take the road of justice.”
Trump’s threats stir controversy
Amid the celebrations, Trump’s recent remarks reignited tensions. He criticised increased fees imposed by Panama for using the canal and threatened to demand its return to the United States.
“If things don’t change after I take office, we will demand that the Panama Canal be returned to the United States of America, in full, quickly and without question,” Trump said, referring to the 1977 treaty as a foolish decision that gave away a vital strategic asset.
However, experts and Panamanian officials quickly dismissed Trump’s threats as implausible. Jorge Luis Quijano, the canal’s former administrator, reiterated that the treaty contains no provisions that would allow the US to reclaim the canal.
“There’s no clause of any kind in the neutrality agreement that allows for taking back the canal,” Quijano said.
Benjamin Gedan, director of the Latin America Program at the Woodrow Wilson International Center for Scholars, noted that the only conceivable path for the US to regain control would be a military invasion, an option he deemed highly unlikely.
A pillar of Panamanian sovereignty
During the ceremony, President Mulino emphasised Panama’s unwavering commitment to retaining control of the canal.
“There are no hands involved in the canal other than Panama’s,” he said. “Rest assured, it will be in our hands forever.”
The 1977 treaty comprises two agreements: one governing the handover of the canal, and another ensuring its neutrality and secure operation. The latter grants the US the right to intervene if the canal’s operation is threatened by military conflict but not to reassert control.
A vital economic lifeline
Since the handover, the Panama Canal has grown into a cornerstone of the country’s economy. Traffic through the canal increased by 17% between 1999 and 2004. In 2006, Panamanians approved a referendum to expand the canal to accommodate larger, modern cargo ships—a $5.2 billion project completed in 2016.
However, the canal has faced significant challenges in recent years. Prolonged droughts in 2022 severely impacted water levels at the locks, forcing Panama to cut shipping traffic and raise fees. Although rainfall has since returned, officials have warned that future rate increases may be necessary to fund improvements and adapt to climate change.
Ricaurte Vásquez, the current canal administrator, highlighted Panama’s resilience in managing the vital waterway amid global challenges.
“The canal has demonstrated that Panamanians are people who can face challenges, including the effects of climate change, world economic cycles, and international conflicts,” Vásquez said.
A celebration of independence and progress
Despite the shadow of Trump’s comments, the anniversary celebrations served as a testament to Panama’s progress over the past quarter-century. The canal remains not only a vital link between the Atlantic and Pacific Oceans but also a symbol of Panamanian sovereignty and national pride.
As Panama continues to navigate global economic pressures and environmental challenges, the legacy of the canal stands as a reminder of the nation’s ability to overcome adversity and assert its place on the world stage.
