Panama denies adjusting canal tariffs for US vessels

PANAMA CITY: The Panama Canal Authority on Wednesday denied it will allow US government vessels to transit the interoceanic waterway for free, as the US State Department announced earlier.

“The Panama Canal Authority, which is empowered to set tolls and other fees for transiting the canal, reports that it has not made any adjustments to them,” the agency said in a statement.

The United States said Wednesday that its government vessels would be allowed to sail for free through the Panama Canal, following heavy pressure from President Donald Trump.

“US government vessels can now transit the Panama Canal without charge fees, saving the US government millions of dollars a year,” the State Department said in a post on social media platform X.

US Secretary of State Marco Rubio earlier said that Panama offered concessions during his talks on Sunday.

Rubio said he had told Panama that it was unfair for the United States to be in a position to defend the vital waterway and also to be charged for its use.

Since winning the November US election, Trump has refused to rule out the use of force to seize the canal, through which 40 percent of US container traffic passes.

Trump and Rubio have complained about Chinese investment — including ports on both sides of the canal — and alleged that Beijing could close the waterway to the United States in a crisis.

Panama has forcefully denied Trump’s repeated allegations that China has been given a role in operating the canal.

But it has also moved to address US concerns. President Jose Raul Mulino after his talks with Rubio said that Panama would not renew membership in the Belt and Road Initiative, Beijing’s signature infrastructure-building program.

Rubio told reporters on Monday that his talks with Mulino were “respectful” and that the visit was “going to achieve potentially good things that assuage concerns we have.”

Trump, however, said that he was still “not happy,” although he acknowledged that Panama had “agreed to certain things.”

The United States and Panama are scheduled to hold new talks on Friday to discuss the canal.

Trump in his inaugural address said the United States would be “taking back” the canal — built more than a century ago by Washington with Afro-Caribbean labor and handed back to Panama at the end of 1999.