Donald Trump Says US Could Demand Return of Panama Canal

What’s New

President-elect Donald Trump has said the U.S. could demand the return of the Panama Canal if the Central American country fails to reduce the fees it charges to American ships.

Writing on Truth Social Saturday, Trump said of the current fees, “this complete ‘rip-off’ of our country will immediately stop.”

Newsweek has contacted the Trump transition team and the Panamanian Embassy in Washington D.C. via email for comment.

Why it Matters

Since winning the election, Trump has signaled a strong “America First” approach to trade and foreign policy, pushing for rebalanced deals on the U.S.s foreign financial commitments.

He has threatened tariffs on various economic partners, suggested Canada should become the 51st state, and said the U.S. should leave more allies to fund their own defense.

What To Know

In his post, Trump said the Panama Canal was a “vital national asset” for the U.S., calling it “crucial” for commerce and national security.

“The fees being charged by Panama are ridiculous, especially knowing the extraordinary generosity that has been bestowed to Panama by the U.S.,” Trump wrote, going on to call the country’s actions “very unfair and injudicious.”

“If the principles, both moral and legal, of this magnanimous gesture of giving are not followed, then we will demand that the Panama Canal be returned to us, in full, and without question.”

Around 14,000 ships pass through the Panama Canal each year, according to figures compiled by Statista. The narrow route, first opened by the U.S. in 1914, allows cargo vessels to travel between the American continents rather than having to circumnavigate them, reducing transit times.

Control of the canal was transferred from the U.S. to the Central American country in 1999 as a result of a 1979 treaty under President Jimmy Carter, which Trump said was “foolish.”

What People Are Saying

Panama Canal Authority director Ricaurte Vásquez, to the Financial Times: “Continuing to raise prices indefinitely is not the way forward, and we are very careful to keep the Panama Canal as a relevant transit route for the whole world.”

Panama President José Raúl Mulino on Twitter in June 2020: “Can the world withstand four more years of Trump? And the Americans?”

The Embassy of Panama to the United States on Twitter in July 2019: “The United States is our number one commercial partner, the #1 user for the canal and our greatest foreign investor, creating opportunity for both nations.”

What Happens Next

When Trump takes office in January, he has signaled he will take a hard line on foreign policy, suggesting that partner countries make better deals with the U.S. or suffer reciprocal actions.