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On Sunday, the President-elect of the United States, Donald Trump said that his new administration would try to regain control of the Panama Canal.
His remarks drew rebukes from Panamanian President Jose Raul Molino.
Here's more on what Trump said and why the Panama Canal is important to the US:
What did Trump say?
Trump raised the issue of the Panama Canal at AmericaFest, an annual event organized by the conservative group Turning Point.
“We're being ripped off in the Panama Canal like we're being ripped off everywhere else,” he said at the event in Arizona, adding that the US had “stupidly betrayed him”.
After AmericaFest, Trump posted a photo on his Truth Social platform of the American flag flying over a narrow body of water with the caption: “Welcome to the United States Channel!”
After Trump's statement, he and Panamanian President Molino traded barbs.
“Every square meter of the Panama Canal and the surrounding area belongs to Panama and will continue to belong (to Panama),” Mulino said in a recorded statement posted on his X account.
Trump reposted a news article about Mulino's statement on his Truth Social platform, captioning it: “We'll see about that.”
In a Truth Social post on Saturday, Trump also alluded to China's growing influence over the Panama Canal. “It should have been run solely by Panama, not China or anyone else,” he wrote. “We would and will NEVER let it fall into the wrong hands!”
China does not control the channel. Hong Kong-based corporation, CK Hutchison Holdings, however, has operated two of the canal's ports, located at the Caribbean and Pacific entrances, since 1997.
In his Sunday statement on X, Mulino also said that China has no influence over the Panama Canal.
What is the argument about?
The Panama Canal is a man-made waterway built on the Isthmus of Panama connecting the Pacific Ocean with the Atlantic Ocean.
Up to 14,000 ships pass through the canal annually. The waterway accounts for about 2.5 percent of global maritime trade and 40 percent of all U.S. container traffic.
The canal is critical for the US to import goods from Asia. The US also uses the waterway to export goods, including liquefied natural gas.
Who built the canal?
The canal was built between 1904 and 1914, mostly by the United States, with then-President Theodore Roosevelt overseeing construction.
Who owns it?
The Panamanian government owns the canal.
When did Panama get ownership?
On December 31, 1999 The US transferred ownership of the Panama Canal under a 1977 treaty signed by then-President Jimmy Carter.
“If the principles, both moral and legal, of this generous gesture of giving are not upheld, then we will demand that the Panama Canal be returned to the United States of America, in full, quickly and without question,” Trump said.
The president-elect did not provide further details on how this would be possible.
Does it dry up the channel?
In 2023 drought conditions in Central America affected the panama canal.
The canal relies on the nearby man-made Gatun Lake to operate its locks. Low water levels in the lake prompted canal authorities to limit the number of vessels using the waterway and increasing user fees.
In the past fiscal year, ships in the Panama Canal were down 29 percent. Between October 2023 and September 2024. 9,944 passed through the channel compared with 14,080 in the previous year.
Traffic on the canal has now returned to pre-landfall levels. However, the fee for next year is expected to increase.
In his statement, Mulino said “tariffs are not set on a whim,” adding that the increased shipping fees will help pay for improvements the Panamanian government has made to allow more shipping traffic through the canal.
What has Trump proposed?
Before the November vote, Trump's presidential campaign was built on non-interventionist America First Policy. However, he has proposed “territorial expansion” numerous times since winning the presidency, with the Panama Canal one of the territories he recently noted as a possibility.
Trump also hinted at Canada. On Dec. 18, he posted on TruthSocial: “Many Canadians want Canada to become the 51st state. They will save significantly on taxes and military protection. I think it's a great idea. 51st state!!!”
It is unclear whether the president-elect was serious. His comments came amid heightened tensions between the US and Canada. After Trump recently threatened to impose tariffs on goods from their northern neighbor, Canadian Finance Minister Chrystia Freeland resigned and the pressure increased for Prime Minister Justin Trudeau to resign.
Trump has also expressed interest in Greenland, an autonomous territory of Denmark. On Monday, Trump announced on Truth Social that he had chosen Ken Howery to be the US ambassador to Denmark, adding to the post that: “The United States of America considers ownership and control of Greenland to be an absolute necessity.”
Trump made this offer during his first term as well, but it was rejected by Danish authorities, with the Danish prime minister telling Danish media that Greenland was not for sale.
