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Kathmandu. US government ships will now be allowed to transit the world-famous Panama Canal for free. The United States said on Wednesday that its government ships will be allowed to travel through the Panama Canal for free, following strong pressure from President Donald Trump.
“US government ships can now transit the Panama Canal for free, saving the US government millions of dollars a year,” the State Department posted on social media platform X. This is the first public announcement of the promises hinted at by US Secretary of State Marco Rubio.
He said on Sunday that Panama had offered concessions during its talks. The Panama Canal Authority, which operates the canal, a vital link between the Atlantic and Pacific oceans, said there was no agreement. “The Panama Canal Authority, which has the authority to set fees and other charges for canal transit, has not made any adjustments to them,” the agency said in a statement. The authority said it remained open to dialogue with US authorities.
Secretary of State Rubio had told Panama that it was unfair that the United States was in a position to protect a vital waterway and still pay a fee for its use. US government ships, mainly Navy ships, make up only a small portion of the ships that pass through the canal. Aircraft carriers are too large to pass through the canal and must make the long journey around South America through the Strait of Magellan.
Trump pressure
The United States and Panama are scheduled to hold new talks on Friday to discuss the canal. Since winning the US election in November, Trump has floated the option of using force to seize the canal. The Panama Canal carries 40 percent of US container traffic. Trump and Rubio have complained about Chinese investment, including in ports on both sides of the canal, and have warned that Beijing could close the waterway to the United States during a crisis.
Panama has strongly denied Trump’s repeated accusations that China has been given a role in operating the canal. But Panama has also moved to address U.S. concerns. After talks with Rubio, President Jose Raul Mulino said Panama would not renew its membership in the Belt and Road Initiative, an infrastructure program signed with Beijing.
Rubio told reporters on Monday that the talks with Mulino were “respectful” and that the visit “is going to achieve something that will potentially alleviate our concerns.” Although Trump said he was still “not happy,” he acknowledged that Panama had “agreed to some things.” In his inauguration speech, Trump said the United States would “take back” the canal.
The canal was built by Washington more than a century ago using Afro-Caribbean labor and returned to Panama in late 1999. Mulino also ordered an audit of Panama Ports Company, a subsidiary of Hong Kong-based CK Hutchison Holdings, which operates the two major ports around the canal.
The company was granted the concession in 1997. It was extended for 25 years in 2021. Despite growing concerns in Washington, China has tightened its grip on Hong Kong. Hong Kong, a former British colony, was promised autonomy. Passenger ships have to pay $150 per vessel and cargo ships $80 per container to cross the 82-kilometer-long canal.
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