U.S. and Panama Agree to Counter Chinese Influence in Panama Canal

U.S. Defense Secretary Pete Hegseth announced an expanded partnership with Panama aimed at securing the Panama Canal against what he termed “China’s maligned influence” in the region.

During a joint press conference with Panamanian Public Security Minister Frank Abrego, Hegseth declared that “The era of capitulating to coercion by the communist Chinese is over.” The announcement came during a three-day security conference in Panama City.

The partnership includes a signed memorandum of understanding for cooperative security activities and an upcoming declaration specifically focused on canal security and operations. This new framework will provide U.S. warships and auxiliary vessels “first and free” passage through the canal.

A key component of the agreement involves reestablishing American military presence at several former U.S. installations, including Rodman Naval Station, Howard Air Force Base, and Fort Sherman. Currently, the U.S. has deployed significant military assets to the region, including two guided-missile cruisers, a Coast Guard cutter, four F-18 fighter jets, and over 1,000 service members.

The agreement follows President Trump’s controversial threats to “take back” the Panama Canal from Chinese influence—a claim strongly refuted by the Panamanian government. To address U.S. concerns, a consortium led by the American investment firm BlackRock reached a deal in March to acquire Hong Kong-based CK Hutchison’s port operations at both ends of the canal, a move that Beijing has widely criticized. The deal has yet to close.

Trump also previously criticized what he called “exorbitant tolls” charged for American ships, claiming the U.S. “foolishly gave away” the canal.

The Panama Canal Authority confirmed the agreement in an official announcement highlighting that the declaration reaffirms Panamanian sovereignty over the waterway and compliance with strict anti-discrimination requirements established by the 1977 Neutrality Treaty between Panama and the U.S. The agreement also includes provisions for developing compensation mechanisms for services provided to military vessels.

The enhanced partnership extends beyond canal security to include joint efforts in combating regional criminal enterprises and border security. Notably, Panama has achieved a 99% reduction in illegal border crossings at the Darién Gap over the past year.

The USNS Comfort, a U.S. Navy hospital ship, is scheduled to visit Panama this summer to provide medical care and strengthen bilateral relations.

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