Panama in Depth: A Peace Corps Publication

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Panamá’s early history was shaped by the ambitions of European powers. In 1501, Rodrigo de Bastidas of Spain conducted the first European exploration of Panamá. One year later, Christopher Columbus visited Panamá and established a settlement in the Darien province. In 1513, Vasco Nuñez de Balboa discovered that the isthmus was indeed the path between the Caribbean Sea and the Pacific Ocean. Panamá quickly became the crossroads of Spain’s empire in the New World, serving as the transfer point for gold and silver being shipped from South America and Spain.

Modern Panamanian history has been shaped by the construction of a trans-isthmus canal, which had been envisioned since the beginning of Spanish colonization. From 1880 to 1900, a French company under Ferdinand de Lesseps attempted, unsuccessfully, to construct a sea-level canal on the site of the present Panamá Canal. In November 1903, with U.S. encouragement and French financial support, Panamá proclaimed its independence and signed the Hay-Bunau-Varilla Treaty with the United States. The treaty granted rights to the United States in a zone roughly 10 miles wide and 50 miles long, wherein the United States would build a canal;; then administer, fortify, and defend it “in perpetuity.” In 1914, the United States completed the existing 50- mile lock canal, one of the world’s greatest engineering triumphs. The early 1960s marked the beginning of sustained pressure in Panamá for renegotiation of this treaty. In 1977 U.S. President Jimmy Carter signed a new treaty with Panamanian President General Omar Torrijos in which control of the canal reverted to the Panamanian people on December 31, 1999.