(WATCH) Panama Canal

Original air date: May 14, 2023

Odds are, many of the products you buy each day or the car that you drive came through one very specific body of water, one built with American manpower and know-how: the Panama Canal. Most days, it’s business as usual at this critical trade route. But there are growing concerns about who else is passing through those storied waters. Scott Thuman reports from Panama.

It is an engineering feat so large it cuts through an entire country, connecting cultures and oceans. The Panama Canal, one of the seven modern wonders of the world, understandable since it took 70,000 men over 10 years to build.

Opening in 1914, it revolutionized how the world trades goods. Roughly $270 billion of cargo crosses through it each year. And improving in the last decade — adding a wider lane to triple its capacity.

The Panama Canal is around 50 miles long, but it only takes about eight hours for a ship to go from the Atlantic to the Pacific, and that can cut days, if not weeks, off of travel time.

Victor Echeverría is the exhibition manager at the Panama Canal Museum.

Victor Echeverría: Well, they knew that eventually, some ships would not fit the canal. So they thought, well we need to build a new set of locks wider, longer, for those ships.

But now, Panama is considering allowing a new controversial customer to frequent these locks: naval military vessels from Iran. That, despite strong opposition from the U.S., which has long maintained sanctions against Iran for its support of terror groups and illicit nuclear weapons programs.

In March, General Laura Richardson laid out those concerns to Congress.

Sen. Tommy Tuberville (R-Alabama): Could you talk a little bit about the two Iranian ships that are parked outside the Panama Canal?

General Richardson: Very concerning because they were just in the region two years ago with missiles and with launchers on those same two ships. And so very, very concerned that they are transiting again.

These days, it’s up to the Panamanians to enforce the rules, but it wasn’t always that way.

Since it was America that built this canal after others had failed, the U.S. had control, and in turn, paid Panama $10 million and yearly rent for rights to the canal zone, a 10-mile-wide strip of land where the canal was dug.

But in the 1970s, pressure was mounting. The Panamanians wanted the land back, and President Jimmy Carter obliged, ceding control in the year 2000 — a decision many predicted the U.S. would come to regret.

Echeverría: And, of course, it was huge. We have the new millennium, New Year’s Eve, and then the turnover of the Panama Canal. So here it was, celebration, 24 hours a day.

Scott: Everyone?

Echeverría: Sure — or, on our side.

Scott: On your side.

Echeverría: Yes.

Though Panama is an American ally, it’s getting increasingly close to our strategic rival, China, which is spending billions of dollars throughout Latin America to gain influence.

Chinese companies now operate ports at both ends of this strategic waterway, prompting fears that a key trade route could be blocked in a crisis.

The United States has real concerns about China’s military buildup around key maritime chokepoints, deploying ships to build an increased presence in an area like the South China Sea, where commercial shipping carries over $5 trillion in goods, much of it headed to America.

The U.S. Navy is so concerned about Iran’s reach into the world’s oceans, it made an unusual announcement last month of the deployment of a submarine capable of carrying up to 154 tomahawk missiles to the Middle East.

So why the real worry about a shutdown at one of the world’s key maritime traffic points?

Two years ago, a cargo ship the length of four football fields was knocked off course by strong winds, blocking the Suez Canal for six days, halting shipments and sending oil prices soaring. Although an accident, it quickly became a wake-up call.

And all of that raises the proverbial tensions and tides in these pivotal waters.

For Full Measure, I’m Scott Thuman, in Panama.

Watch story here.

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