Inaugural addresses are typically domestically oriented. And this held true for US President Donald Trump’s speech today, albeit with a notable exception: his focus on the Western Hemisphere.
Coupled with the fact that several of this new administration’s high-ranking officials have significant experience in Latin America, this focus reflects the president’s prioritization of the region.
Not surprisingly, the border featured just as prominently in Trump’s 2025 inaugural address as it did in 2017 when he argued on the Mall that “We’ve defended other nation’s borders while refusing to defend our own.” And Trump’s declaration of a national emergency at the southern border—a move he announced in his inaugural speech and formalized with an executive order hours later—mirrored many aspects of his February 2019 declaration.
But Trump’s 2025 speech deviated from his 2017 address with the president’s emphasis on Panama.
In a clear sign that his vocal concerns about the Panama Canal had not abated, Trump devoted nearly two full paragraphs to Panama, saying that “Panama’s promise to us has been broken” and that “China is operating the Panama Canal. And we didn’t give it to China, we gave it to Panama, and we’re taking it back.” Panamanian President José Raúl Mulino swiftly responded with an official statement reiterating Panama’s sovereignty over the canal.
Trump’s concerns about the Panama Canal Treaties didn’t materialize in just the last few weeks. In 2003, when the then Trump-owned Miss Universe contest was held in Panama City, he first got to know the country. According to reports, Trump even then expressed that the United States got ripped off by the treaties. Interactions with Panama came to a head in 2018 when a legal dispute arose between the Trump Organization and a Miami-based hotel investor, who was trying to break off ties with the Trump business. The situation escalated into a standoff with Panamanian authorities, and eventually, Trump’s name was taken off the hotel at the center of the dispute.
What’s the status of the canal?
The canal is operated by the Panama Canal Authority, an autonomous government entity, which is in charge of the operation, maintenance, and modernization of the canal and sets the fees for passage. According to the treaty, those fees must be “just, reasonable, equitable, and consistent with international law.” In recent years, fees have increased, and while they are largely in line with the Suez Canal, auctions to enter the canal can significantly bump up the total transit fees. Trump’s concern—and that of US Senator John Curtis (R-UT) who asked Secretary of State Marco Rubio about the canal at last week’s confirmation hearing—is about the extent of Chinese influence in the canal alongside the higher costs.
Back in 1997, a Hong Kong-based consortium won a bidding process to operate ports at each end of the canal. Since then, China’s growing interest in the canal, and in Panama overall, has generated concerns. Notably, in 2017, Panama cut ties with Taiwan, ushering in a new era of Chinese investment. In March 2024, then-US Southern Command Commander Laura Richardson noted at the Atlantic Council her concerns about China’s rising influence in the canal.
What can Trump do to “take back” the canal?
One option is to ramp up US investment in the canal and in the many businesses that directly and indirectly support canal operations. The United States needs to really get in the game to win the game. And that US investment would be welcomed by the Panamanians.
The new Panamanian government is more pro-US than its predecessors. Mulino, who took office in July 2024, has made great efforts to more closely align Panamanian policy with US positions and is a ready partner to accelerate US investment in Panama. Recently, in Panama, I saw and heard concerns about a disproportionate uptick in Chinese investment and a yearning for more US companies to invest in Panama, from its tech sector to its maritime industry.
In alignment with Trump’s vision, his presidency can be an opportunity to further use the tools of the US government to accelerate such investment so as to crowd out Chinese interests to the benefit of the United States and Panama. US economic and national security will be significantly advanced with greater US business presence and investment in construction projects around the canal. Here, Trump will find a willing partner with the Panamanians in his bid to take back the canal.
Jason Marczak is vice president and senior director at the Atlantic Council’s Adrienne Arsht Latin America Center.
Note: This article was updated on January 20 to reflect Trump’s formal signing of an executive order declaring an emergency on the southern border.
Further reading
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Legitimate concerns about growing Chinese influence over the canal demand Washington’s attention and warrant a measured, diplomatic approach.
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Image: Donald Trump gestures during the 60th Presidential Inauguration in the Rotunda of the US Capitol in Washington, DC on Monday, Jan. 20, 2025. Photo by Julia Demaree Nikhinson/Pool via REUTERS