No menu items!

COSTA RICA'S LEADING ENGLISH LANGUAGE NEWSPAPER

HomeTopicsLatin AmericaPanama Denies US Free Access Through Strategic Canal

Panama Denies US Free Access Through Strategic Canal

The Panamanian government on Thursday called the U.S. government’s announcement that its ships would not pay for transiting the Panama Canal “absolutely false,” a toll that Washington considers “absurd.” Amid tensions over Donald Trump’s threat to retake control of the waterway, Panamanian President José Raúl Mulino said the information about toll-free passage is based on “lies” and “absolute falsehood.”

“This is intolerable, plain and simply intolerable,” Mulino said forcefully at a press conference, adding that he will speak with Trump by phone on Friday at 15:30 local time (20:30 GMT). The State Department stated Wednesday on social network X that the Panamanian government agreed to “no longer charge fees to U.S. government vessels,” which would represent a “savings” of millions of dollars.

On Thursday, U.S. Secretary of State Marco Rubio said in the Dominican Republic that he finds it “absurd” that his country must pay fees “to transit a zone” that it is obligated “to protect in times of conflict.” But the Panama Canal Authority (ACP), the independent entity that manages this strategic waterway, quickly denied having adjusted the fees.

“It’s not like the canal toll is breaking the United States economy… it’s around 6 or 7 million dollars per year based on the number of vessels that cross,” said Mulino, referring to military ships. Although it contradicted Washington, the ACP assured in a statement its willingness to dialogue with the United States “regarding the transit of warships.”

The 80-km interoceanic route, inaugurated in 1914 and through which 5% of global maritime trade passes, was built by the United States and handed over to Panamanians in December 1999 under bilateral treaties. Jorge Quijano, former canal administrator, told AFP that Panama “would violate the treaties” if it exempts the United States from payment because it would be discriminatory against other countries.

Audit Against Chinese Company

The controversy arose after the U.S. diplomatic chief’s visit to Panama on Sunday, where he conveyed to Mulino concerns about Chinese “influence” in the canal. The United States considers it a national security threat that Hong Kong company Hutchison Holdings operates, under concession, two ports at the canal entrances, believing Beijing could close it in case of conflict.

Mulino recalled that Panama Ports, a subsidiary of the Chinese company, is under a “comprehensive audit” and he will wait for the results before making a decision about the 25-year concession, established in 1997 and renewed in 2021. “If they violate the concession terms or cause imminent economic harm to the country, we will act accordingly, but for now the audit stands,” he emphasized.

Since winning the election in November, Trump has not ruled out using force to retake control of the canal, through which more than 40% of U.S. container traffic passes, according to U.S. government data. The United States, with 74% of cargo, and China, with 21%, are the main users of the waterway, according to ACP data.

Belt and Road, Canceled

Following Washington’s pressure for Panama to distance itself from China, Mulino announced Thursday the cancellation of the Belt and Road economic agreement, signed in 2017 by the then-Panamanian government and set to expire in 2026. Mulino assured that Panama’s embassy in Beijing officially presented the “cancellation” document. “It’s a decision I made,” he emphasized.

The agreement, which contemplates financing infrastructure projects with Chinese funds and promotes trade, is Xi Jinping’s government’s flagship program. On Wednesday, Chinese foreign ministry spokesman Lin Jian had said that “cooperation between China and Panama under the Belt and Road framework” was developing “normally” and bearing fruit. He expressed hope that “parties resist external interference.”

Rubio had considered Panama’s decision not to renew the agreement a “great step” toward strengthening relations with Washington on Monday.

Trending Now

Argentina’s Cerundolo Repeats Ruud Upset at Swiss Open

Juan Manuel Cerundolo has found an opponent and a setting that bring out his most stubborn tennis. For the second consecutive year, the Argentine...

Giant Tarpon Rule the Río Colorado at Costa Rica’s Silver King Lodge

The first thing one learns about tarpon fishing at the mouth of the Río Colorado is that nothing comes easily. The Caribbean can be...

US Issues Chikungunya Alert for Costa Rica Travelers

If you are heading to Guanacaste this month, pack insect repellent and treat mosquito bites as a real risk rather than a minor annoyance....

Panama Bill Would Require Influencers to Disclose Paid Posts

Panama’s National Assembly is considering a bill that would require social media influencers and content creators to clearly identify when their posts are paid...

New Nonstop From Ottawa to Costa Rica’s Guanacaste Coast This Winter

If you fly out of Ottawa, reaching the beaches of Guanacaste is about to get a lot easier. WestJet is adding a direct flight...

OIJ Detains 34 in Costa Rica Prison Drug Network Case

The Organismo de Investigación Judicial (OIJ) detained 34 people on the morning of Tuesday, July 21, in an operation against what investigators describe as...

Historic UCR Music School Faces Possible Closure

The historic building that houses the University of Costa Rica’s School of Musical Arts could lose its operating permit after health inspectors found infrastructure...

Costa Rica Bridge to Manuel Antonio Faces “Imminent Failure” Warning

A bridge on the main car route toward one of Costa Rica's most-visited places has been flagged as at risk of collapse, according to...

Costa Rica’s President Says She Faces Nine Threats, One Involving a Sniper

President Laura Fernández said yesterday that she has received information about roughly nine alleged plans to attack her, including one she described as involving...
🌴 The Weekly Pura Vida

Costa Rica, Once a Week

The week's top stories, weather & insider tips — delivered every Sunday. One email, zero clutter.

🔒 Free. No spam. Unsubscribe anytime.

Loading…

Latest News from Costa Rica

Costa Rica Coffee Maker Chorreador
Costa Rica Car Rentals
Costa Rica Travel Insurance
Costa Rica Travel