Panama Bends to U.S. Pressure, Grants Free Navy Passage Through Canal

By Eric Martin (Bloomberg) —

Panama promised free passage for US warships through the Panama Canal and said it will withdraw from China’s signature lending program after Secretary of State Marco Rubio blasted the government during his visit on Sunday.

Rubio, echoing President Donald Trump’s complaints about Chinese influence over the waterway, warned that the US would “take measures necessary to protect its rights” unless Panama makes immediate changes, the State Department said after Rubio met President Jose Raul Mulino.

The Panamanian leader played down the tensions but reiterated his country won’t give up the canal, as his government offered other concessions to the US.

The canal authority said late Sunday it will “optimize transit priority” of US Navy ships through the waterway. Mulino assured Rubio that US Navy vessels would enjoy free passage, a US official said. Panamanian officials didn’t immediately respond to a request for comment on that assertion.

Trump in December complained about what he called “exorbitant” rates that he said Panama charged the US Navy and companies for using the canal and threatened to retake control.

Muli…