Teddy Roosevelt, the man who wielded a big stick and shaped American power in the Western Hemisphere, would presumably be pleased. In just a matter of hours, President Trump’s firm stance on the Panama Canal and China’s encroachment yielded major concessions from Panamanian leadership.
Secretary of State Marco Rubio’s visit to Panama made it clear: the days of unchecked Chinese influence in the region are numbered. In response, President José Raúl Mulino Quintero quickly distanced his country from Beijing. He announced that Panama will not renew its participation in China’s Belt and Road Initiative—Beijing’s global infrastructure strategy that doubles as an influence operation. Additionally, he signaled a possible early termination of Panama’s relationship with a Hong Kong-based company that operates key ports on either end of the Canal. To top it off, Mulino reportedly offered U.S. naval ships exemptions from transit fees—an unmistakable sign of deference to Washington.
And there was yet another significant concession: Panama agreed to facilitate the repatriation of migrants crossing the Darien Gap, the treacherous jungle route used by those heading for the U.S. southern border.
At this early stage, Rubio’s job seems easy—doors are opening not because of his charm, but because of the fear of his boss. Trump has made it abundantly clear that he won’t sit idly by while foreign powers, particularly China, gain a foothold in America’s backyard. His approach is a sharp departure from the hands-off policies of recent administrations.
The Panamanian government likely hasn’t slept well in recent weeks. Trump’s criticism of their Canal management grew louder after the election. Then, in his inaugural address, he issued an extraordinary statement—one that went largely unnoticed in the flurry of news—that he intended to “take it back.”
Would Trump really go that far? Would he risk an international crisis by asserting control over the Canal? The answer remains uncertain, but one thing is clear: no one in Panama wants to find out.
Panama’s entanglement with China dates back to 2017, when it cut diplomatic ties with Taiwan in favor of Beijing. Since then, Chinese influence has expanded across Panama’s logistics, electricity, and construction sectors, with significant involvement in infrastructure projects near the Canal. While these developments may not outright violate the Panama Canal treaties, they certainly undermine their spirit.
The United States handed over control of the Canal in 1999 under the terms of the 1977 Panama Canal treaties. The Neutrality Treaty, however, guaranteed that the Canal would remain permanently neutral and gave the U.S. the right to intervene if that neutrality were ever threatened. Given China’s aggressive global strategy and its track record of leveraging economic investments for political control, its growing influence in Panama is a clear cause for concern.
The Canal remains one of the most strategically vital waterways in the world. Nearly 40 percent of U.S. container traffic passes through its 51 miles annually, according to the Council on Foreign Relations. More than just an economic lifeline, it is a crucial military asset, allowing the U.S. Navy to rapidly shift forces between the Atlantic and Pacific in times of crisis.
Trump, like Roosevelt before him, understands this reality. TR championed the Canal’s construction after helping Panama achieve independence from Colombia. He saw it as a cornerstone of American power—and history has proven him right.
In hindsight, relinquishing control of the Canal was a mistake. But in the 1970s, the prevailing wisdom among U.S. policymakers—fueled by fears of Latin American unrest—was to appease Panama’s demands for sovereignty. Ronald Reagan led a vocal opposition to the treaties, but President Jimmy Carter managed to push them through the Senate.
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