US Can Affirm Panama’s Sovereignty and Forbid CCP Influence Simultaneously

Apr 19, 2025 - 10:03 Updated: Apr 19, 2025 - 09:52

US Can Affirm Panama’s Sovereignty and Forbid CCP Influence Simultaneously

Commentary

The U.S. Department of Defense hailed a historic set of agreements on April 11 that Secretary of Defense Pete Hegseth negotiated with Panamanian President José Raúl Mulino. The agreements provide enhanced U.S. military access to Panamanian bases, “free and first” access of U.S. naval ships through the Panama Canal, and increased military training between U.S. and Panamanian forces.

However, the agreements are troubled by alleged infringement of Panama’s sovereignty, and an overly lax approach by Panama to a major global threat: the Chinese Communist Party (CCP).

The agreements take place in the context of geopolitical competition between the United States and China for influence over the Panama Canal, which is one of a handful of naval chokepoints globally. Panama itself is trying to retain control of the canal, which produces almost $3.5 billion in annual revenue. The canal is central to the Panamanian public’s conception of Panamanian pride and Panama’s national sovereignty.

President Jimmy Carter transferred the canal to Panama through two treaties in 1977. They were ratified by the U.S. Senate in 1978. In January, however, U.S. President Donald Trump said he intends to take back the canal. Trump directed the Defense Department to increase the U.S. troop presence in Panama from its prior 200 troops. U.S. troops in Panama, including special forces, have in the past helped Panama’s military control internal threats.

Trump at the very least seeks to increase U.S. troops to counter CCP influence around the canal. The former commander of the U.S. Southern Command, Army Gen. Laura Richardson, said that China’s facilities near the canal can be rapidly converted to military use. This could shut down the canal during a war with China over Taiwan, for example. Chinese facilities in the canal would make it difficult to rapidly move U.S. naval assets from the Atlantic to the Pacific in the event of such a contingency.

Hegseth revealed in a Fox News interview on April 10, right after his return from Panama, that the Chinese regime was tunneling under the canal for surveillance purposes. He said that Chinese cranes at the canal were “full of surveillance equipment.”

Trump has said he not only wants Chinese influence and facilities out of the canal zone, but he wants a return of U.S. ownership of the canal. He directed the Defense Department to prepare military options up to and including seizure of the canal by force.

The latter threat may be a form of hard bargaining. Taking the canal by force would be opposed by most Panamanians and Americans. In January, a poll indicated that 48 percent of Americans opposed the use of military force to take the Panama Canal, compared to just 36 percent who supported the idea.

The Historic Hegseth Agreements

Over the past month, Hegseth has striven for cooperation with Panama against the CCP, rather than aggression against Panama. On April 9 in Panama City, Hegseth chose his words carefully.

“The era of capitulating to coercion by the communist Chinese is over,” he said. The regime’s ”growing and adversarial control of strategic land and critical infrastructure in this hemisphere cannot and will not stand.”

Hegseth called the Panama Canal “key terrain that must be secured by Panama, with America, and not China.”

When Hegseth returned to the United States from Panama, he praised Panama’s leaders on Fox News as “eagerly pro-American,” noting that they “kicked out” Beijing’s Belt and Road Initiative.

The agreements Hegseth signed in Panama appear designed to appease Trump without ceding any of Panama’s sovereignty. They allow U.S. military personnel to rotate through or train on military bases in Panama, including three former U.S. bases: Rodman Naval Station, Howard Air Force Base, and Fort Sherman. The latter will enable joint jungle training between U.S. and Panamanian forces. U.S. military personnel will also have access to Cristóbal Colón Naval Air Base.

The agreements provide “a framework allowing U.S. warships and auxiliary ships to sail first and free through the canal,” according to the Pentagon. This means that the U.S. Navy jumps to the head of the line to get through the canal, and its ships go through the canal for free, rather than paying the fee that ships from other nations and U.S. commercial vessels pay.

Critics of the agreement argue that it violates the 1977 U.S.–Panama treaties and the Panamanian constitution. The political opposition in Panama alleges that the United States is conducting a “camouflaged invasion” of Panama through gradually increasing the number of U.S. troops in the country.

There is also daylight between the United States and Panama on the sensitive topic of sovereignty over the canal. The Panamanian version of one of the new agreements says that “Secretary Hegseth recognized the leadership and inalienable sovereignty of Panama over the Panama Canal and its adjacent areas.” But the U.S. version omits this sentence.

“We’re taking back the Panama Canal from malign Chinese interests and making the Americas great again,” Chief Pentagon spokesman Sean Parnell said on April 11. The United States is no longer “taking the canal back,” but taking it back “from malign Chinese interests.”

That’s a welcome difference when it comes to Panama’s sovereignty. But the threat of the former likely led to the latter. And Trump has not yet taken military action off the table. As Hegseth noted on Fox News, Trump knows how to move the Overton window.

Tug of War With China

Hegseth told Fox News that in Panama, there is a “tug of war with the Chinese … on the streets of Panama City right now.” He spoke of “forces underneath their politics trying to pull down President Mulino, a pro-American, pro-Trump president who wants to work with America, [and] doesn’t want to work with the communist Chinese.“ He added: ”But the Chinese are trying to undermine that. They’re trying to instill more insidious influence.”

Hegseth said there was “huge fraud” in the Hong Kong-owned ports on both sides of the Panama Canal, and that the ports would now likely be sold to BlackRock. The ports are owned by a Hong Kong company, CK Hutchison. But the BlackRock sale is said to have hit a snag: an alleged $300 million to $1.2 billion owed by CK Hutchison or its subsidiaries to the government of Panama.

Panamanian Comptroller General Anel Flores plans to file criminal charges. He said he will brief the Panama Maritime Authority, which can terminate the concessions to CK Hutchison. If so, perhaps the government of Panama, rather than CK Hutchison, could sell the ports to BlackRock.

The reported $300 million isn’t much in a $19 billion deal for CK Hutchison’s 43 ports globally, including the two at the canal. So there is a reasonable solution to the problem: The Panamanian or U.S. government could seize $300 million worth of China’s assets to repay Panama. Then, the deal could go through. Or, BlackRock deducts $300 million from the offer price. The deduction is then given to Panama. This is also minuscule compared to the $18 trillion that the CCP arguably owes the United States due to its failed attempt to cover up COVID-19, which led to lax policies, the escape of the virus from China, and the global pandemic.

Beijing could be seeking to buy the ports through a Chinese buyer. Cosco Shipping Lines and China Merchants are allegedly in discussions with CK Hutchison, according to The Wall Street Journal. If it is indeed true, this should be resisted by all concerned.

A New Monroe Doctrine?

There is a certain justice to the agreements that Hegseth negotiated, as the United States spent about $375 million (more than $11 billion in current dollars) building the canal between 1904 and 1914, and 75 percent of today’s traffic through the canal is either coming from or going to a U.S. port.

How the U.S. government sees the CCP changes over time. Countries like Panama, as well as companies anywhere that do not want to get on the wrong side of U.S. law, ought to act proactively to disengage from CCP entities.

The territorial integrity of nations is a commitment the United States made in 1945 to our friends, allies, and partners around the world. That is in part how we got their support for all these years, including against the CCP. As soon as we compromise the sovereignty of one of our partners, all the rest will trust us a little less.

Latin America is not a U.S. “backyard.” This terminology is insulting to our allies in the region. And it buys into the mindset of Moscow and Beijing, and how they treat their neighbors. If we start thinking like them, we lose the moral high ground. At the same time, there is a strong argument in favor of the United States keeping the world’s most dangerous authoritarian regimes out of Latin America, because the Americans are the only ones who can. President James Monroe made this point in his doctrine of 1823.

After World War I and World War II, a new layer was added to how the doctrine played out. The world gained a new respect for the territorial integrity of nations. Violating that integrity today would tend to lead to the kinds of wars that most Americans do not want to get involved in. So we need a new doctrine. As applied to Panama, it would simultaneously honor Panama’s sovereignty, not forcibly take back what we freely gave through negotiations, but demand that Panama not host entities under the control of the CCP, which is arguably a terrorist organization. This is, hopefully, what the United States is now muddling toward. Expect some confusion as it irons itself out.

Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times.