''Un país que no se vende'': Negotiations and Signing of the Torrijos-Carter Panama Canal Treaties

11 
 
 
PREFACE 
 
It seemed that last year’s October 21 had started as any morning in the previous six 
days. I was in David in the province of Chiriquí, Panama at that time, at my 
grandparents’ house, with nothing better to do than reorganize and catalog the hundreds 
of photographs and documents I had managed to find during my long research trip for 
my thesis. I was working on the PC in the dining room, creating folders and metadata 
for my archival loot, when I heard a distinct and familiar ¡ay Dios mío! coming from 
the kitchen. It was my Italian-born but Panamanian-naturalized grandmother, who had 
evidently seen something she disliked on television. I could not yet foresee that what 
she watched would negatively affect the rest of my stay in the country, but it would also 
inspire the preface of this work. 
The previous day, the Panamanian Congress had passed in record time a new 
contract between the state and the Canadian mining company First Quantum Minerals 
(FQM) for the concession and exploitation of the Cobre copper mine, the most 
important in the country and, more generally, among the largest in Central America. It 
was not the first time that the Canadian company had operated in the area: the first 
contract was awarded in 1997, but the Environmental Advocacy Center challenged the 
agreement on the ground of its constitutionality. But it was only in 2017 that the 
Suprema Corte de Justicia declared the agreement unconstitutional, a ruling published 
in the Official Gazette, however, only four years later. Since then, Panama and FQM 
have begun new negotiations for a new contract that could be legal and ended with a 
positive outcome in mid-October. The new agreement provided for the concession of 
the mine for 20 years with possible renewal for another 20 years and the payment of 
$375 million annually by the private company to be able to operate in the area. A decent
12 
 
 
result considering that in the previous contract there was no provision for any tax or 
duty to be paid. 
Most Panamanians, however, did not think so: demonstrations against the mine were 
called, starting from March of the same year, when, in short, negotiations for the new 
contract began. What amazed me, however, was the nature and scope of the riots 
throughout the country. Beginning on October 21, a multitude of Panamanians took to 
the streets in all the cities of the country, blocking the main communication routes. 
Panama is not a densely populated country, nor does it have efficient road connections: 
if even a few nerve centers are compromised, the entire state comes to a standstill. The 
riots, sometimes quite violent, continued for over a week, despite the tropical storms 
that flooded numerous provinces every day. Many demonstrators remained impassive 
despite the rain, continuing to block bridges, roads and even airports, asking President 
Laurentino Cortizo to (but it was unclear how) revoke the contract. 
But why were the people of Panama so on fire? To think of such a reaction in a 
similar case in Europe would be far-fetched. There must have been some deeper reason 
that led such a large slice of the population to demonstrate so decisively and unitedly, to 
the point of blocking the economy of an entire country. Because it must be said that in 
those two weeks of protests, not even ambulances could avoid getting bogged down in 
traffic. Not to mention the various fresh or refrigerated food trucks, schools, 
universities, offices and shops. Certainly, the environmental issue was a factor that 
brought a part of “green” public opinion to the streets. The mine is in fact unfortunately 
located in a problematic area of the country: the Mesoamerican Biological Corridor, a 
narrow tropical forest route in northern Panama that allows thousands of medium to 
large animal species to move from North America to South America and vice versa. 
The 12,000-hectare mine is placed right in the middle of this green corridor, a protected
13 
 
 
area. But this is not the motivation that probably filled the squares the most. The 
environmental signs and slogans were undeniably present, of course, but other elements 
overshadowed them: Panamanian flags and ¡Panamá no se vende! posters. In Italy, 
when there are protests against the climate crisis, deforestation and pollution, you do 
not usually see national flags around. For this reason, I do not think it is plausible that 
Panamanian environmentalists are the only ones in the world who are also nationalists. 
How did this happen? Panama, like most Latin American countries, is tormented by 
the ghosts of imperialism: the people are terrified by the balance of power that is created 
between the state and any major foreign player, be it a country or a private company. 
When the stakes are high, in this case a mine that alone contributes more than 4% of the 
country’s GDP, the words “concession” and “20-year renewable agreement” are not 
simply red flags but are already national defeats. This explains the multitudes of 
national flags (which ironically was designed by the wife of the French Philippe-Jean 
Bunau-Varilla, a signatory to the first Panama Canal Treaty between the United States 
and Panama). The History of Panama is also the history of one of the largest territorial 
concessions in contemporary history. It is as if New York did not have sovereignty over 
Wall Street, or London over the City. The loss of direct control over a huge economic 
resource rekindles Panamanian nationalism and the memory of what was once the 
infamous Panama Canal Zone, the U.S. exclave that for almost a hundred years was the 
cause of the general dissatisfaction of the small Caribbean country.  
After weeks of protests, Cortizo proposed a referendum at the end of October. By a 
strange twist of fate, October was also the month in which the 1977 plebiscite on the 
Panama Canal Treaties took place. Eventually, the Tribunal Electoral rejected the 
possibility of a referendum but only a few days the Asamblea Nacional approved a bill
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that suspended new mining concessions in Panama, and on November 28, the Suprema 
Corte unanimously ruled the contract as unconstitutional.
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INTRODUCTION 
 
Pobre del país - Donde lo malo controla donde el civil se enamora de la corrupción, 
Pobre del país - Alienado por la droga porque una mente que afloja pierde la razón, 
Pobre del país - Que con la violencia crea que puede matar la idea de su liberación, 
Pobre del país - Que ve la justicia hecha añicos por la voluntad del rico o por orden militar. 
Cada nación depende del corazón de su gente y a un país que no se vende nadie lo podrá comprar. 
¡No te olvides!
1
 
 
During the first semester of the master’s degree course in Padua I attended the 
lectures of “Global History,” a class held by Professor Carlo Fumian. The course was 
very peculiar because it did not deal chronologically with specific events, as is often 
done in history classes. Instead, the professor sought to reconstruct recurring dynamics 
within the world-system that consolidated the interrelationships between people, capital, 
and services. A sort of thematic history of globalization with a major focus on the one 
that followed the Industrial Revolution of the mid-nineteenth century. I remember one 
of the professor's sentences that struck me the most at the time, it was something like “it 
cost less to ship a cargo from Liverpool to Buenos Aires than to transport the same 
cargo from the Argentine capital to the hinterland. And that didn't change much even 
after the massive construction and introduction of railways in much of the world.” 
More than two hundred years have passed since the Industrial Revolution, but the 
long-distance economic advantage of trade by sea compared to road, rail and air 
remains undeniable.
2
 And that is not all. It is true that in ancient, classical, medieval and 
modern times, most of the richest towns were port cities, but after the invention of the 
 
1
 Rubén Blades, “Prohibido Olvidar,” track 7 on Caminando, Sony Music Enter. and Sony Inter., 1991. 
2
 For more information, see Kevin H. O’Rourke and Jeffrey G. Williamson, Globalizzazione e storia: 
L’evoluzione nell’economia atlantica dell’Ottocento, (Bologna: il Mulino, 2005).
16 
 
 
steamship, the commercial possibilities grew even more for these large ports. The 
reduction of transport costs and therefore the cost of trade was a crucial moment in the 
history of the world, a point of no return. The opening of new markets and new 
possibilities for enrichment and hegemony consequently favored the emergence of new 
strategies to be able to capitalize as much as possible on the resources of the new 
system. One of the pioneers and leading theorists of the importance of maritime power 
was undoubtedly the U.S. Admiral Alfred Thayer Mahan, who offered a new strategic 
vision of sea routes and colonial-imperial possessions, in part in opposition to the 
mercantilist philosophy of the previous century. Mahan, as a U.S. strategist, was among 
the firsts to see the need for expansion into foreign markets to address the challenge of 
overproduction and underemployment. Above all, the Admiral re-evaluated the 
importance of the colonies as strategic bases for the commercial fleet and navy, no 
longer to be considered a mere docking point where ships full of commodities departed. 
In other words, Mahan contributed to the geostrategic rationalization of his country, 
influencing many presidents to come, especially Theodore Roosevelt.
3
 
The evolution of a geostrategic imperialism that replaced colonial expansionism, in 
some ways for its own sake, inaugurated a new season in the history of the balance of 
power between the great European empires, and also the United States. The opening of 
the Suez Canal in 1869, Western strategies for the control of Chinese ports and the 
massive investment of Europeans in some Atlantic cities in Latin America, were just 
some of the great consequences of this paradigm shift. In particular, although the Suez 
Canal ended up costing the Egyptians and French much more than expected, it had a 
considerable effect on the expansion of international trade, thanks in part to the 
 
3
 Walter LaFeber, “A Note on the ‘Mercantilistic Imperialism’ of Alfred Thayer Mahan,” The Mississippi 
Valley Historical Review 48, no. 4 (March 1962): 674-85; Peter Karsten, “The Nature of ‘Influence’: 
Roosevelt, Mahan and the Concept of Sea Power,” American Quarterly 23, no. 4 (March 1971): 585-600.
17 
 
 
increasingly massive implementation of the aforementioned steamships.
4
 The new route 
allowed large ships to reduce travel times (and of course costs) by almost three times 
compared to the old Magellan route, and it was not long before some entrepreneurs and 
engineers turned their gaze to the west, seized by a sense of omnipotence. If 
circumnavigating Africa was only a waste of time and money, circumnavigating 
America was a matter of life and death: passing from the north, through the Canadian 
islands was impossible due to the polar ice, while passing from the south under the 
Tierra de Fuego meant encountering very strong storms that seriously risked 
endangering crew and cargo.
5
 An “American Suez” became an increasingly essential 
work for the development of global trade, and the Isthmus of Panama would become 
that very place for this waterway. 
The history of the Panama Canal is a long process characterized by failures, 
deceptions and tensions. This odyssey took place in a Central American country whose 
history in the last century would not have been so dissimilar to those of other small 
neighboring states, if only it had not been for this economic resource disproportionate to 
Panama's wealth that is the interoceanic canal. Today, the net profit directly linked to 
the canal is about 2 billion dollars, about 3% of the country's GDP. Added to this are a 
whole series of economic and financial services inextricably linked to the existence of 
the canal, which constitute the most profitable sector of the State.
6
 Yet this was not 
 
4
 Caroline Piquet, “The Suez Company’s Concession in Egypt, 1854-1956: Modern Infrastructure and 
Local Economic Development,” Enterprise & Society 5, no. 1 (March 2004): 107-110. 
5
 James R. Fleming, Meteorology in America, 1800-1870 (Baltimore: John Hopkins University Press, 
1990), 4-5. 
6
 International Monetary Foundation Western Hemisphere Department, “Panama Growth Story,” IMF 
Staff Country Reports 129, A002, March 2023, (all websites were last accessed on February 1, 2024), 
https://web.archive.org/web/20231026173312/https://www.elibrary.imf.org/view/journals/002/2023/129/
article-A002-en.xml.
18 
 
 
always the case. The Panamanian Government has had complete sovereignty over the 
canal and the entity that manages it for less than a quarter century, a very short time 
compared to the more than one hundred years of existence of the infrastructure. 
Reconstructing the history of the Panama Canal in detail, from the failure of the French 
project to the Panamanian attainment of sovereignty, passing through the creation and 
management of the Panama Canal Zone by the United States, is an enormous 
undertaking. For this reason, we decided here to dwell on a single crucial moment in the 
history of the canal and relations between the United States and Panama: the January to 
September 1977 negotiations on the complete transfer of the ownership of the canal. 
This last effort between the diplomatic teams of the Torrijos and Carter Governments 
was the last act in a series of largely unsuccessful attempts that lasted at least thirteen 
years to find a new agreement on the U.S. management of the canal. In fact, the United 
States owned the waterway along with a portion of 1,432 square kilometers of isthmus 
land to the right and left of the infrastructure. This intense diplomatic process was an 
almost unique moment in recent history, in which two countries, one 133 times larger 
and 2000 times richer than the other, found themselves negotiating almost equally on an 
issue of utmost importance for both. 
Technically, there is only one in-depth study of the Panama Canal negotiations: Las 
Negociaciones de los Tratados Torrijos-Carter 1970-1979 by the Panamanian historian 
and geographer Omar Jaén Suárez, who was also a member of the Comisión Panameña 
de Tierras, Aguas y Administración del Canal, responsible for the technical and less 
“flashy” aspects of the outcome of the agreements.
7
 Suárez's work is indeed very 
peculiar, as he had the fortune to be both a protagonist of the negotiation and a scholar 
 
7
 Omar Jaén Suárez, Las negociaciones de los tratados Torrijos-Carter 1970-1979, vol. 2 (Panama City, 
Panama: Panama Canal Authority, 2005).