💃Latin American History – 1791 to Present

💃latin american history – 1791 to present review

4.3 The Panama Canal and Its Geopolitical Significance

3 min readLast Updated on August 6, 2024

The Panama Canal, completed in 1914, revolutionized global trade and naval strategy. This massive engineering feat connected the Atlantic and Pacific oceans, cutting shipping times and costs. Its construction faced huge challenges, from tropical diseases to difficult terrain.

The canal's creation intertwined with Panama's independence from Colombia, backed by the U.S. The 1903 Hay-Bunau-Varilla Treaty gave the U.S. control over the Canal Zone, showcasing America's growing influence in Latin America during the early 20th century.

Panama Canal Construction

Building the Canal

Top images from around the web for Building the Canal
Top images from around the web for Building the Canal
  • Panama Canal is an artificial waterway connecting the Atlantic and Pacific oceans through the Isthmus of Panama
  • Canal construction began in 1904 and was completed in 1914, taking a decade to build
  • Construction faced numerous challenges including tropical diseases (malaria and yellow fever), difficult terrain, and engineering obstacles
  • Excavation of the Culebra Cut, an artificial valley that cuts through the Continental Divide, was one of the most difficult and time-consuming parts of the construction process
  • Over 5,600 workers died during the construction of the canal due to accidents and diseases

Leadership and Workforce

  • George W. Goethals, a U.S. Army officer and civil engineer, was appointed Chief Engineer of the Panama Canal in 1907
    • Goethals oversaw the construction of the canal and implemented strict sanitation measures to reduce the spread of tropical diseases among workers
    • He also introduced new technologies and construction techniques to improve efficiency and speed up the building process
  • The workforce consisted of thousands of workers from various countries, including the United States, Caribbean islands (Barbados and Jamaica), and Europe (Spain and Italy)
  • West Indian workers made up a significant portion of the labor force and were crucial to the completion of the canal despite facing discrimination and poor working conditions

Panamanian Independence and Treaty

Separation from Colombia

  • Panama was originally a province of Colombia
  • In 1903, with support from the United States, Panama declared its independence from Colombia
  • The U.S. quickly recognized Panama as an independent nation, which strained relations between the U.S. and Colombia
  • Colombian separation was driven by the U.S. desire to secure control over the canal zone and construction rights

Canal Zone Sovereignty

  • Hay-Bunau-Varilla Treaty, signed in 1903, granted the United States perpetual control over the Panama Canal Zone
    • The treaty established the Canal Zone as a 10-mile wide strip of land along the canal route, effectively dividing Panama into two parts
    • Panama Canal Zone was under U.S. jurisdiction and operated as a U.S. territory until 1979
  • Theodore Roosevelt, U.S. President from 1901 to 1909, played a significant role in supporting Panamanian independence and securing U.S. control over the Canal Zone
    • Roosevelt's foreign policy, known as "Big Stick diplomacy," asserted U.S. dominance in the region and justified intervention in Latin American affairs

Geopolitical Significance

Strategic Importance

  • The Panama Canal greatly reduced travel time and distance for ships navigating between the Atlantic and Pacific oceans
    • Before the canal, ships had to sail around the southern tip of South America (Cape Horn), which was a long and dangerous route
    • The canal allowed for faster and safer passage, saving time and fuel costs for shipping companies
  • Control of the canal gave the United States a strategic advantage in both military and commercial matters
    • U.S. Navy could quickly move warships between the two oceans, enhancing its global power projection capabilities
    • During World War II, the canal played a crucial role in U.S. military strategy, allowing for rapid deployment of troops and supplies to the Pacific theater

Economic Impact

  • The Panama Canal boosted global trade by providing a shorter and more efficient shipping route
    • The canal facilitated the growth of trade between the East Coast of the United States and Asia, as well as between Europe and the West Coast of the Americas
    • Major commodities transported through the canal include grains (wheat and corn), petroleum products, and containerized cargo
  • Panama's economy benefited from the canal through jobs, infrastructure development, and revenue generated from canal tolls
    • Canal tolls, fees charged to ships passing through the canal, provide a significant source of income for the Panamanian government
    • The canal's presence led to the development of port cities (Colón and Panama City) and the growth of related industries, such as logistics and tourism

Key Terms to Review (18)

American Imperialism: American imperialism refers to the policy and practice of the United States extending its influence and control over other nations and territories, particularly during the late 19th and early 20th centuries. This expansion was often justified by a belief in American exceptionalism and a desire for economic growth, strategic military positioning, and cultural influence. The construction of the Panama Canal exemplifies how American imperialism shaped geopolitical dynamics in Latin America and beyond.
Big stick diplomacy: Big stick diplomacy is a foreign policy approach associated with Theodore Roosevelt, emphasizing the use of military power and a strong presence to achieve diplomatic goals. The phrase reflects the idea of negotiating peacefully while threatening with the 'big stick' of military force if necessary, fundamentally shaping U.S. interactions in Latin America and the Caribbean during the early 20th century.
Canal Zone: The Canal Zone was a strip of land in Panama that was controlled by the United States from 1904 to 1999, created for the construction and operation of the Panama Canal. This area was significant not only for its engineering marvel but also for its geopolitical importance, as it served as a critical trade route that connected the Atlantic and Pacific Oceans, facilitating international commerce and military movement.
Cold War: The Cold War was a prolonged period of political tension and military rivalry between the United States and the Soviet Union, which began after World War II and lasted until the early 1990s. It was characterized by ideological conflict, arms races, proxy wars, and significant influence in various regions, particularly Latin America, where both superpowers sought to expand their political and economic ideologies.
Ecological disruption: Ecological disruption refers to significant alterations in the natural environment that can lead to negative impacts on ecosystems, biodiversity, and human societies. These disruptions often stem from human activities such as deforestation, pollution, and urbanization, which can have lasting effects on local and global ecosystems, including those around major infrastructure projects like canals.
Economic imperialism: Economic imperialism refers to the practice where powerful nations extend their influence and control over less developed countries primarily through economic means rather than direct political rule. This often involves the manipulation of local economies, control over resources, and the establishment of trade agreements that favor the dominant nation. In the context of significant projects like the Panama Canal, economic imperialism illustrates how nations pursued their interests by shaping local economies to facilitate trade and enhance geopolitical power.
Ferdinand de Lesseps: Ferdinand de Lesseps was a French diplomat and engineer, best known for overseeing the construction of the Suez Canal and later the Panama Canal. His vision and leadership were crucial in making these massive engineering projects a reality, significantly impacting global trade routes and international relations.
Hay-Bunau-Varilla Treaty: The Hay-Bunau-Varilla Treaty was an agreement signed in 1903 between the United States and Panama, granting the U.S. control over the Panama Canal Zone in exchange for a payment and guarantees of Panamanian independence. This treaty significantly shaped U.S. foreign policy in Latin America and set the stage for the construction of one of the most strategically important waterways in the world.
Interoceanic canal: An interoceanic canal is a man-made waterway that connects two oceans, allowing ships to travel between them without navigating around landmasses. The most notable example of an interoceanic canal is the Panama Canal, which dramatically transformed maritime trade by reducing travel time and costs between the Atlantic and Pacific Oceans, making it a crucial point for international shipping routes and geopolitical strategy.
Labor exploitation: Labor exploitation refers to the unfair treatment of workers through low wages, long hours, and poor working conditions, often driven by the desire for profit at the expense of workers' rights and well-being. This issue is particularly significant in the context of large-scale projects like the Panama Canal, where the demand for cheap labor resulted in the suffering and mistreatment of thousands of workers, illustrating broader themes of inequality and power dynamics in global labor practices.
Maritime trade routes: Maritime trade routes are the established paths used by ships to transport goods across oceans and seas, forming the backbone of global commerce. These routes have historically connected various regions, facilitating not just trade but also cultural exchanges and geopolitical relations. Their significance has evolved over time, particularly with the development of major waterways like the Panama Canal, which greatly enhance the efficiency of maritime trade by shortening travel distances between key markets.
Panama Canal Construction: The Panama Canal construction refers to the monumental engineering project that created a waterway across the Isthmus of Panama, allowing ships to travel between the Atlantic and Pacific Oceans without navigating around South America. This project, completed in 1914, was crucial in reshaping global trade routes and enhancing maritime commerce, significantly impacting geopolitical dynamics in the region and beyond.
Panamanian Sovereignty: Panamanian sovereignty refers to the full control and authority of Panama over its territory, particularly in the context of the Panama Canal and its surrounding areas. This sovereignty has been a focal point in the nation's history, especially regarding the tensions with the United States, which operated the canal for much of the 20th century. Achieving and maintaining sovereignty has shaped Panama's national identity and geopolitical relations in the region.
Roosevelt Corollary: The Roosevelt Corollary was an extension of the Monroe Doctrine, articulated by President Theodore Roosevelt in 1904, asserting that the United States had the right to intervene in Latin America to stabilize economic or political situations. This policy fundamentally changed U.S. foreign relations, emphasizing military intervention and economic influence to prevent European powers from intervening in the region, leading to a more active American presence in Latin America.
Theodore Roosevelt: Theodore Roosevelt was the 26th President of the United States, serving from 1901 to 1909, and is best known for his progressive policies and strong foreign affairs approach, particularly in relation to the construction and geopolitical significance of the Panama Canal. Roosevelt's administration played a crucial role in expanding American influence in Latin America and demonstrating the United States' commitment to asserting its presence on the global stage.
Trade expansion: Trade expansion refers to the growth and increase in the exchange of goods and services between countries or regions. This concept is crucial for understanding the economic relationships that develop as nations seek new markets and resources, particularly in relation to infrastructure developments like the Panama Canal, which significantly alters trade routes and dynamics.
Treaty of 1977: The Treaty of 1977, formally known as the Torrijos-Carter Treaties, was an agreement between the United States and Panama that established the process for transferring control of the Panama Canal from U.S. hands to Panama. This treaty marked a significant turning point in U.S.-Panamanian relations, as it acknowledged Panama's sovereignty over the canal and aimed to end a long-standing period of American control that had been seen as imperialistic by many Panamanians.
Treaty of Paris: The Treaty of Paris refers to a series of agreements signed in 1783 that ended the American Revolutionary War and recognized American independence from Great Britain. This treaty not only marked the birth of the United States but also had significant implications for the geopolitical landscape in the Americas, including the context of territorial disputes and future foreign policy decisions.
American Imperialism
See definition

American imperialism refers to the policy and practice of the United States extending its influence and control over other nations and territories, particularly during the late 19th and early 20th centuries. This expansion was often justified by a belief in American exceptionalism and a desire for economic growth, strategic military positioning, and cultural influence. The construction of the Panama Canal exemplifies how American imperialism shaped geopolitical dynamics in Latin America and beyond.

Term 1 of 18

American Imperialism
See definition

American imperialism refers to the policy and practice of the United States extending its influence and control over other nations and territories, particularly during the late 19th and early 20th centuries. This expansion was often justified by a belief in American exceptionalism and a desire for economic growth, strategic military positioning, and cultural influence. The construction of the Panama Canal exemplifies how American imperialism shaped geopolitical dynamics in Latin America and beyond.

Term 1 of 18



© 2025 Fiveable Inc. All rights reserved.
AP® and SAT® are trademarks registered by the College Board, which is not affiliated with, and does not endorse this website.

© 2025 Fiveable Inc. All rights reserved.
AP® and SAT® are trademarks registered by the College Board, which is not affiliated with, and does not endorse this website.