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Panama Celebrates 25th Anniversary of Panama Canal Handover Amid Trump’s Threats to Reclaim Control

Panama marked the 25th anniversary of the United States' handover of the Panama Canal on Tuesday, a historic event made bittersweet by the recent passing of former U.S. President Jimmy Carter, who negotiated the landmark 1999 treaty.

Panama City: Panama marked the 25th anniversary of the United States’ handover of the Panama Canal on Tuesday, a historic event made bittersweet by the recent passing of former U.S. President Jimmy Carter, who negotiated the landmark 1999 treaty. The ceremony in Panama City reflected both pride in the country’s sovereignty over the vital waterway and mourning for Carter, who passed away on Sunday.

Panamanian President José Raúl Mulino opened the event by expressing a mix of joy and sorrow, noting, “On this special day, a mix of happiness for the 25th anniversary of having the canal in Panamanian hands and the sadness we feel for the death of former President Jimmy Carter.”

The ceremony also included a moment of silence in Carter’s honor. Mulino highlighted the pivotal role played by Carter and former Panamanian leader Omar Torrijos in securing the agreement.

While the celebration honored the anniversary, the event also comes amid rising tensions, particularly with incoming U.S. President Donald Trump. Trump has voiced opposition to increased fees Panama has imposed for the use of the canal and has threatened to “demand” the waterway’s return to the United States if he does not see changes.

Trump has criticized the 1977 treaty, which he called “foolish,” but has not clarified how he plans to act on his threat.

During the ceremony, President Mulino refrained from directly addressing Trump’s comments but sought to assure the public about Panama’s control of the canal, saying, “There are no hands involved in the canal other than Panama’s. Rest assured, it will be in our hands forever.”

The 1999 handover was based on two treaties: one for the transfer of control and another, ongoing agreement ensuring U.S. rights to intervene for security reasons if military conflict threatens the canal’s operation. However, the agreement does not permit the U.S. to reclaim control of the waterway.

Experts, including former Panama Canal administrator Jorge Luis Quijano and Woodrow Wilson International Center’s Benjamin Gedan, assert that the canal’s sovereignty remains firmly with Panama, with no clause in the neutrality agreement allowing for its return to the U.S. Gedan emphasized that any attempt to regain control would likely be impossible without a significant escalation, such as military intervention.

Since the handover, the Panama Canal has seen significant growth in traffic, with a 17% increase in usage between 1999 and 2004. In 2006, Panama voters approved a referendum for a major expansion project, which was completed in 2016 at a cost of more than USD 5.2 billion.

The expansion allowed the canal to accommodate larger cargo ships, and Panama’s canal revenues continue to rise despite challenges like last year’s droughts, which impacted shipping traffic and prompted a rise in fees.

Canal administrator Ricaurte Vásquez noted that the waterway continues to adapt to global challenges, including climate change and shifting economic cycles, affirming Panama’s capability to manage the canal effectively in the future.

As Panama reflects on a quarter-century of stewardship over the canal, the country remains committed to maintaining its control and addressing the evolving demands of global shipping.

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