U.S. Claims Free Passage Through Panama Canal? Not So Fast, Says Panamanian Leadership.....

UPDATED Feb 6 2025

In a development that reads like a geopolitical sitcom, the U.S. State Department recently declared that U.S. government vessels can now transit the Panama Canal without incurring fees—a move that, if true, would save Uncle Sam millions of dollars annually. 

However, the Panamanian President fired back on Thursday, flatly denying any such deal exists.

During his weekly press conference, the Panamanian President explained that when he spoke with the U.S. Secretary of Defense just yesterday, he made it abundantly clear that he had neither the authority to set transit fees nor to exempt any vessel from paying them. 

“I completely reject that statement,” he said. So taken aback was he by the U.S. claim that free passage was now in effect that he immediately asked Panama’s ambassador in Washington to challenge the U.S. State Department’s announcement.

Meanwhile, the Panama Canal Authority joined in the chorus of denials with a terse statement issued late Wednesday night, asserting that it had “not made any adjustments” to the fees for transiting the canal. 

This unified front leaves little room for speculation: despite the U.S. State Department’s claim on X (formerly Twitter) that the new policy is saving millions, neither the Panamanian leadership nor the canal administrators have authorized any fee waivers.

Adding to the intrigue, these conflicting narratives come on the heels of a recent visit by the U.S. Secretary of State to Panama. During that trip, he met with both the Panamanian President and canal administrators, carrying a message from the U.S. President that China’s growing influence around the canal was, in his view, unacceptable. 

The U.S. top diplomat warned that the Chinese presence might violate a treaty established in 1977—which led to the eventual turnover of the canal in 1999—that ensures the waterway remains permanently neutral.

While canal administrators hinted that giving U.S. warships priority in crossing is open for discussion, none have suggested that fees could ever be waived. 

The Panamanian President emphasized that both the country’s constitution and the laws governing the canal make it crystal clear: neither the government nor the canal authority has the power to suspend fees. 

“It’s a constitutional limitation,” he declared, leaving no doubt that free passage is not on the table.

So here we are: the U.S. State Department’s claim of fee-free transits now finds itself squarely at odds with Panamanian officials’ insistence that the rules remain unchanged. 

For now, U.S. vessels will continue to pay their toll, and the saga over control—and cost—of one of the world’s most important trade arteries is far from over.

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