Panama Canal

The Panama Canal is an 82-kilometre waterway across the narrowest part of the Isthmus of Panama, linking the Caribbean Sea and the Atlantic with the Pacific. A French company began it in 1881 and failed; the United States took over in 1904 and opened it in 1914, after one of the largest and costliest engineering efforts ever attempted. Its zone was obtained after Panama broke away from Colombia with American support, and after most of a century under United States control it passed fully to Panama in 1999.

The idea is as old as European contact. Vasco Núñez de Balboa crossed the isthmus in 1513, and in 1534 the emperor Charles V had a route surveyed to ease travel between Spain and Peru, then part of the Spanish Empire. Nothing came of it, and later surveyors, including Alexander von Humboldt in 1811, often preferred a route through Nicaragua. The California gold rush of 1848 created heavy traffic across Panama, and between 1850 and 1855 an American syndicate built a railway from Colón to Panama City, at a cost of thousands of workers' lives from tropical disease.

Ferdinand de Lesseps, fresh from his triumph at Suez, won backing at a Paris congress in 1879 for a sea-level canal, rejecting an engineer's proposal for locks and an artificial lake. Work began on 1 January 1881, using a concession granted by Colombia, which then ruled Panama. The project was far harder than Suez: heavy rain turned the Chagres River into a torrent, landslides kept refilling the great cut through the hills at Culebra, and yellow fever and malaria swept the camps, since no one yet knew that mosquitoes carried them. The labour force, mostly from the West Indies, reached about 40,000 in 1888. By the time the company went bankrupt in 1889 some 22,000 people had died and around 800,000 French investors had lost their savings. The resulting Panama scandal brought prosecutions, including of de Lesseps and his son.

After long debate the United States chose Panama over Nicaragua and agreed to buy the French company's assets for $40 million. When the Colombian Senate rejected a treaty leasing the canal strip in 1903, President Theodore Roosevelt backed Panamanian separatists. American warships prevented Colombian troops from reaching the isthmus, Panama declared independence on 3 November 1903, and Washington recognised it at once. Days later the Frenchman Philippe Bunau-Varilla, acting as Panama's envoy, signed a treaty giving the United States the Canal Zone, a deal many Panamanians soon condemned as an infringement of their sovereignty. The episode is often cited as a classic case of American gunboat diplomacy, and in 1921 the United States paid Colombia $25 million in return for its recognition of Panama.

The Americans took over in May 1904. Chief engineer John Stevens rebuilt the railway and workers' housing, and William Gorgas led a sanitation campaign that had nearly eliminated mosquito-borne disease within two years. Stevens persuaded Roosevelt to abandon the sea-level plan in favour of locks lifting ships to Gatun Lake, created by damming the Chagres and at the time the largest artificial lake in the world. Under George Goethals, who took charge in 1907, workers cut through the continental divide at Culebra. About 5,600 workers died during the American phase, most of them West Indian labourers, particularly from Barbados. The canal opened on 15 August 1914, having cost the United States almost $500 million.

Resentment of American control grew after the Second World War, especially after the Suez Crisis showed a canal could be nationalised. Riots on 9 January 1964, remembered in Panama as Martyrs' Day, left about 20 Panamanians and several American soldiers dead. In 1977 Jimmy Carter and Omar Torrijos signed treaties providing for a handover, and at noon on 31 December 1999 the state-owned Panama Canal Authority took full control.

A third, wider lane of locks, approved by referendum in 2006, opened to commercial traffic on 26 June 2016 for much larger Neopanamax ships. The canal depends on fresh water from Gatun Lake, and droughts, notably in 2023, have forced cuts in daily transits. From December 2024 renewed American calls to retake the canal were rejected by the government of Panama, which regards it as an inalienable part of the national patrimony.