Secretary of State Marco Rubio visits Panama on Saturday in his first foreign trip as part of the Trump administration.
President Donald Trump says the country should give the Panama Canal back to the U.S. But Panamanian President José Raúl Mulino said this week that’s “impossible,” and a U.S. military seizure of the canal looks unlikely.
Rubio instead may pressure Mulino to reduce China’s large presence around the canal. That pressure could include the threat of U.S. financial force, say diplomats like former U.S. Ambassador to Panama John Feeley.
“I don’t see any reasonable possibility of military invasion,” Feeley told WLRN. “I don’t see a blockade of the canal. If you take those two off the table, what I do see is sanctions or tariffs.”
But Feeley warns penalizing goods coming from or through Panama could backfire on Trump economically.
“If the president does in fact put a tariff on all goods going through the canal that come into U.S. ports, you’re going to start to see that in the prices of your iPhones and all the manufactured goods,” he said.
Rubio said this week, though, that Trump’s desire to take back the canal is “not a joke.”
Trump first made noise about taking back the canal just before Christmas, claiming without evidence that the canal overcharges U.S. ships that transit through it and that China now runs the passage.
The U.S. handed control of the canal to Panama a quarter century ago under a 1977 treaty. Since then, it has enlarged the waterway, which now handles 6% of the world's maritime cargo traffic.
But because of that success, China and Chinese companies have poured billions into infrastructure projects like ports, bridges and roads since Panama established diplomatic relations with Beijing a decade ago. That presence alarms Washington, which wants to curtail China's burgeoning economic and diplomatic influence in the Western Hemisphere.
Rubio, in an interview with SiriusXM host Megyn Kelly, said Chinese companies are “all over Panama,” citing many experts who believe those companies are beholden to the communist government in Beijing and would carry out orders to cut off or limit traffic to the canal in the event of a conflict with Taiwan or an unrelated breakdown in relations with the U.S.
“If the government in China in a conflict tells them to shut down the Panama Canal, they will have to,” he said. “I have zero doubt that they have contingency planning to do so that is a direct threat.”
Rubio added that, “If China wanted to obstruct traffic in the Panama Canal, they could,” and that would be a violation of the treaty signed by former President Jimmy Carter under which the U.S. ceded control of the American-built canal to Panama in 1999.
The former Florida senator also echoed Trump’s complaint that American ships are being overcharged for using the canal, which would also be a violation of the treaty.
“We should not be in a position of having to pay more than other countries. In fact, we should be getting a discount or maybe for free, because we paid for the thing,” he said.
Information from the Associated Press was used in this report
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