Panama Canal Negotiations in Focus as Rubio Visits Central America

U.S. Secretary of State Marco Rubio deplanes at the international airport in Panama City on Feb. 1, 2025. Mark Schiefelbein/Pool/AFP via Getty Images

U.S. Secretary of State Marco Rubio kicked off his trip to Latin America, arriving in Panama on Feb. 1, with a focus on the Panama Canal and China’s intrusion into the zone.

“Secretary of State Marco Rubio will travel to Panama, El Salvador, Costa Rica, Guatemala, and the Dominican Republic from February 1–6 to advance President Trump’s America First foreign policy,” the U.S. Department of State said in a Jan. 31 statement.

Rubio is expected to discuss the United States’ interest in the critical waterway connecting the Caribbean Sea and the Pacific Ocean. The president has suggested retaking control over the canal, citing the threat of Chinese hegemony in the region.

Rubio addressed the issue of Chinese involvement in the Panama Canal during a Jan. 30 interview with Megyn Kelly of The Megyn Kelly Show.

“One of the main investments they have is in these two port facilities on both—on the entry—on both sides of the canal. And all kinds of other infrastructure, cranes and the like,” Rubio said.

While the company engaged in these activities is from Hong Kong, it still comes under the control of the Chinese regime, he said.

“And if the government in China in a conflict tells them to shut down the Panama Canal, they will have to. And in fact, I have zero doubt that they have contingency planning to do so. That is a direct threat. So it’s a technicality, but in reality if China wanted to obstruct traffic in the Panama Canal, they could. That’s a fact,” he said.

Such an arrangement violates the Panama Treaty agreement with the United States.

“That dynamic cannot continue—not simply because we built it at great cost in lives and treasure, but because it is contrary to our national interest. It is not in the national interest of the United States to have a canal we paid for and we built used as a leverage and a weapon against us. That can’t happen,” Rubio said.

However, Panamanian President José Raúl Mulino recently said he will not engage in any negotiations over ownership of the canal.

“It’s impossible, I can’t negotiate,” he said. “That is done. The canal belongs to Panama.”

The canal opened in 1914 after a 10-year construction effort by the United States. The 51-mile waterway connecting the Caribbean Sea with the Pacific Ocean makes trade much more efficient.

“Around 72 percent of transiting ships are either going to or coming from U.S. ports,” according to the U.S. Department of Commerce. “By using the Panama Canal, ships can save considerable time and fuel costs. The shorter transit time reduces the time in transit and enables faster delivery of goods.”

As such, any disruption in shipping via the canal can have a significant negative effect on the United States. The canal was granted to Panama by President Jimmy Carter in a deal signed in 1977.

The deal consists of two treaties—the Neutrality Treaty and the Panama Canal Treaty. The Neutrality Treaty states that the United States may use its military might to protect the canal from any threat to its neutrality.

Trump argues that the neutrality agreement has been broken as Chinese companies have built up a dominating presence in the region. He criticized the “exorbitant prices and rates of passage” charged for U.S. Navy ships and commercial vessels to pass through.

During a news conference in early January, President Donald Trump said he does not rule out using economic or military coercion to bring the waterway under U.S. control.

“It might be that you'll have to do something. Look, the Panama Canal is vital to our country. It’s being operated by China. We gave the Panama Canal to Panama. We didn’t give it to China, and they’ve abused it. They’ve abused that gift,” he said.

U.S. Secretary of State Marco Rubio (3rd R) greets Panamanian Foreign Minister Javier Martínez-Acha (2nd R) and John Barrett, chargé d'affaires  at the U.S. Embassy in Panama (4th R), upon arrival at the international airport in Panama City on Feb. 1, 2025. Mark Schiefelbein/Pool/AFP via Getty Images

Rubio’s Mission

In addition to the Panama Canal issue, Rubio’s Central America trip also aims to “promote regional cooperation on our core, shared interests: stopping illegal and large-scale migration, fighting the scourge of transnational criminal organizations and drug traffickers, countering China, and deepening economic partnerships to enhance prosperity in our hemisphere,” the State Department said.

In El Salvador, Rubio will seek to ensure the country’s cooperation with the United States’ deportation efforts. On Jan. 31, special envoy to Latin America Mauricio Claver-Carone said the United States hopes to secure a “safe third country” deal with El Salvador.

Under the deal, illegal immigrants deported from the United States who aren’t taken back by their home nations shall be granted asylum in El Salvador.

“During the first Trump administration, El Salvador was one of three countries that had a ‘safe third’ agreement with the United States,” Claver-Carone said.

The effort is part of the Trump administration’s broader policy of cracking down on illegal immigrants into the United States.

On Jan. 20, Trump signed an executive order aimed at border security. Under the order, the United States seeks to deter and prevent the entry of illegal aliens into America, pursue criminal charges “against illegal aliens who violate the immigration laws,” and remove “promptly all aliens who enter or remain in violation of federal law,” among other measures.

Trump has signed a memorandum seeking to prepare the Guantanamo Bay Naval Base in Cuba to detain illegal immigrants.

Homeland Security Secretary Kristi Noem recently said that the Trump administration “has stopped all grant funding that’s being abused by NGOs that’s being used to facilitate illegal immigration” into the United States.