Panama Canal administrator pushes back against Trump's assertions of Chinese meddling

PANAMA CITY (AP) — The administrator of the Panama Canal said Friday that the vital waterway will remain in Panamanian hands and open to commerce from all countries, rejecting claims by President-elect Donald Trump that the United States should take it over.

In an interview with The Associated Press, Ricaurte Vásquez denied Trump’s claims that China was controlling the canal’s operations, and said making exceptions to current rules controlling its operation would lead to “chaos.”

He said Chinese companies operating in the ports on either end of the canal were part of a Hong Kong consortium that won a bidding process in 1997. He added that U.S. and Taiwanese companies are operating other ports along the canal as well.

Trump has gone so far as to suggest the U.S. should take control of the canal back and he would not rule out using military might to do so.

“It might be that you’ll have to do something,” Trump said Tuesday. “The Panama Canal is vital to our country.” Trump has characterized the fees for transiting the canal that connects the Atlantic and Pacific Oceans as “ridiculous.”

Panama President José Raúl Mulino has said unequivocally that the canal will remain in Panamanian hands.

Vásquez stressed that the Panama Canal was open to the commerce of all countries.

The canal can’t give special treatment to U.S.-flagged ships because of a neutrality treaty, Vásquez said. “The most sensible and efficient way to do this is to maintain the established rules.”

Some 70% of the sea traffic that crosses the Panama Canal leaves or goes to U.S. ports.

The United States built the canal in the early 1900s as it looked for ways to facilitate the transit of commercial and military vessels between its coasts. Washington relinquished control of the waterway to Panama on Dec. 31, 1999, under a treaty signed in 1977 by President Jimmy Carter.

Last month, Trump told supporters “We’re being ripped off at the Panama Canal.” He claimed that the U.S. “foolishly gave it away.”

Regarding the fees for using the canal, Vasquez said a planned series of increases had concluded with one this month. Any additional increases would have to be considered in the first half of the year to give clients certainty in their planning and would go through a public comment process, he said.

The canal depends on reservoirs to operate its locks and was heavily affected by drought during the past two years that forced it to substantially reduce the number of daily slots for crossing ships. With fewer ships using the canal each day, administrators increased the fees that are charged all shippers for reserving a slot.

The canal bisects Panama, running 51 miles end to end. It allows ships to avoid the longer and costlier trip around Cape Horn at the tip of South America.