On Sunday, US President-elect Donald Trump He said His new administration will try to regain control of the Panama Canal.

His comments sparked a rebuke from Panama President Jose Raul Molino.

Here’s more about what Trump said and why the Panama Canal is so important to the United States:

What did Trump say?

Trump brought up the Panama Canal at AmericaFest, an annual event organized by the conservative group Turning Point.

“We are being robbed in the Panama Canal just as we are being robbed anywhere else,” he said at the event in Arizona, adding that the United States had “foolishly given that up.”

Following the America Festival, Trump posted a photo on his Social Reality platform of a US flag flying over a narrow body of water with the caption: “Welcome to USA Channel!”

After Trump’s statement, he and Panamanian President Molino exchanged harsh criticism.

“Every square meter of the Panama Canal and the surrounding area belongs and will continue to belong to Panama [to Panama]Molyneux said in a recorded statement posted on his X account.

Trump reposted a news article about Molyneux’s statement on his platform, Truth Social, and commented: “We’ll see about that.”

On Saturday, in a post on Truth Social, Trump also alluded to China’s growing influence over the Panama Canal. “It was up to Panama alone, not China or anyone else,” he wrote. “We will never let it fall into the wrong hands!”

China does not control the canal. However, Hong Kong-based CK Hutchison Holdings has operated two of the canal’s ports, located on the entrances to the Caribbean Sea and Pacific Ocean, since 1997.

In his statement Sunday on Channel X, Molyneux also said China has no influence on the Panama Canal.

What is the controversy about?

The Panama Canal is a man-made waterway built on the Isthmus of Panama, connecting the Pacific Ocean to the Atlantic Ocean.

Up to 14,000 ships pass through the canal annually. The waterway accounts for an estimated 2.5 percent of global maritime trade and 40 percent of total U.S. container traffic.

The canal is essential for the United States to import goods from Asia. The United States also uses the waterway to export goods, including liquefied natural gas.

Who built the canal?

The canal was built between 1904 and 1914, mostly by the United States, and then-President Theodore Roosevelt oversaw construction.

Who owns it?

The government of Panama owns the canal.

When did Panama gain ownership?
On December 31, 1999, the United States handed over ownership of the canal to Panama under a 1977 treaty signed by then-President Jimmy Carter.

“If the moral and legal principles of this generous gesture are not followed, we will demand that the Panama Canal be returned to the United States of America, in its entirety, quickly and without question,” Trump said.

The president-elect did not provide further details on how this would be achieved.

Is the canal dry?

In 2023, drought Conditions in Central America affected Panama Canal.

The canal relies on the nearby artificial lake Gatun to operate its locks. The falling water level in the lake prompted the canal authorities to do so Limit the number Ships using the waterway have increased user fees.

In the last fiscal year, the Panama Canal saw a 29 percent drop in the number of ships. Between October 2023 and September 2024, 9,944 people crossed the channel, compared to 14,080 the previous year.

Canal traffic is now back to pre-drought levels. However, fees are expected to increase next year.

“The tariffs were not set on a whim,” Molino said in his statement, adding that the increased shipping fees will help pay for improvements made by the Panama government to allow more ship movement through the canal.

What did Trump suggest?

Before the November election, Trump’s presidential campaign was built on… Non-interference “America First” policy. However, he has proposed “territorial expansion” several times since winning the presidency, and the Panama Canal was one of the areas he recently mentioned as possible.

Trump has also alluded to Canada. On December 18, he posted on TruthSocial: “Many Canadians want Canada to become the 51st state. They will save significantly on taxes and military protection. I think it’s a great idea. 51st state!!!

It is unclear whether the president-elect is serious. His statements came amid escalating tensions between the United States and Canada. After Trump recently threatened to impose tariffs on goods coming from its northern neighbour, Canadian Finance Minister Chrystia Freeland resigned and… The pressure intensified Prime Minister Justin Trudeau must resign.

Trump also expressed interest in Greenland, an autonomous region of Denmark. Trump announced Monday on Truth Social that he had selected Ken Howery as US ambassador to Denmark, adding to the post that: “The United States of America feels that ownership and control of Greenland is an absolute necessity.”

Trump made this proposal during his first term as well, but the Danish authorities rejected it, as the Danish Prime Minister told Danish media that Greenland is not for sale.