U.S. Troops HEAD BACK – But Not Permanently!

U.S. troops are set to return to the Panama Canal under a new security agreement, while tension grows over canal fees and China’s regional influence.

At a Glance

  • A new agreement allows U.S. troops to deploy to Panama Canal for training exercises and joint operations
  • Panama has rejected any permanent U.S. military bases, emphasizing its sovereignty
  • The deal involves reviving former U.S. military facilities at Fort Sherman, Rodman Naval Station and Howard Air Force Base
  • Trump administration has raised concerns about canal fees and China’s influence in the region
  • The Panama Canal, transferred to Panamanian control in 1999, remains strategically critical for global trade

U.S.-Panama Security Agreement Details

The United States and Panama have signed a memorandum of understanding allowing U.S. troops to deploy to the Panama Canal for training exercises and joint operations. Defense Secretary Pete Hegseth announced the agreement, which will increase military cooperation between the two nations but stops short of establishing permanent American bases on Panamanian soil. The deal represents a significant shift in U.S.-Panama military relations since American troops withdrew from the country in 1999 when control of the canal was transferred to Panama.

The agreement focuses on reestablishing rotational and joint presence at several former U.S. military installations, including Fort Sherman, Rodman Naval Station and Howard Air Force Base. At Fort Sherman, plans include reviving the Jungle School alongside Panamanian forces. This arrangement appears designed to balance U.S. security interests with respect for Panamanian sovereignty – a delicate diplomatic balance after decades of complicated history between the two nations. 

Panama’s Sovereignty Concerns

Panamanian officials have firmly rejected any suggestion of permanent U.S. military installations on their soil. Security Minister Frank Abrego made the country’s position clear following discussions about the new security arrangement. The sensitivity surrounding American military presence in Panama stems from the country’s complex history with the United States, including the 1989 U.S. invasion to remove dictator Manuel Noriega, which resulted in significant civilian casualties and infrastructure damage.

“Panama made clear, through President Mulino, that we cannot accept military bases or defense sites,” said Panama’s Security Minister Frank Abrego.  

The current agreement appears carefully structured to respect these sovereignty concerns while enhancing security cooperation. Defense Secretary Hegseth characterized the arrangement as involving “rotational” troop deployments rather than permanent stationing. 

This distinction is crucial for Panama, which has maintained that while it welcomes cooperation with the United States, it will not surrender control over its territory or the strategically vital canal that represents both national pride and an essential source of revenue.

Canal Fees and Strategic Concerns

A key underlying issue in the negotiations has been canal fees for U.S. warships. The Trump administration has sought “first and free” passage for American naval vessels, arguing they’re currently overcharged. Panama has resisted providing free passage, instead proposing what Panama Canal Authority representative Jose Ramón Icaza described as a “cost-neutral” compensation system. This dispute reflects the canal’s critical importance to both nations – it handles about 6% of world maritime trade.

“We will seek a mechanism by which warships and auxiliary ships can have a compensation system for services, that is, a way to make them cost-neutral but not free,” said Jose Ramón Icaza.  

The U.S. has also expressed concerns about China’s growing influence in the region, particularly around the strategically vital canal. Defense Secretary Hegseth’s recent statements emphasized deterring Chinese threats in the Western Hemisphere, though he clarified that the U.S. does not seek conflict with China. 

These concerns may have accelerated the security agreement, as American officials have repeatedly cited Chinese activities near the canal as a potential security risk. Recent developments include a deal for a U.S.-led consortium to purchase Hong Kong-backed Panama Ports Company’s facilities, reducing Chinese commercial presence.

Historical Context and Future Implications

The current security arrangement represents a significant shift in U.S.-Panama relations, which have evolved considerably since the 1977 Torrijos-Carter Treaties that set the stage for transferring canal control to Panama by 1999. While U.S. troops maintained a substantial presence until the handover, this new agreement marks the first formalized return of American forces, albeit in a more limited capacity focused on joint training exercises and rotational deployments rather than permanent basing. 

According to the Defense Secretary Pete Hegseth: “This memorandum of understanding will increase joint training exercises, operations and overall interoperability between our two forces, reestablishing rotational and joint presence at Fort Sherman, Rodman Naval Station and Howard Air Force Base. At Fort Sherman, reviving the Jungle School alongside Panamanian forces.” 

The timing of this agreement appears connected to broader geopolitical concerns, including China’s growing influence in Latin America and disputes over canal fees and access. For many American security analysts, ensuring unfettered access to the Panama Canal represents a fundamental national security interest, given its pivotal role in enabling naval mobility between the Atlantic and Pacific. For Panamanians, maintaining sovereignty while cooperating with international partners remains the delicate balance their government must navigate.

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