The impact of the treaties on the Panama Canal itself.

Background

On September 7, 1977 -- 73 years after the signing of the 1903 treaty -- President Jimmy Carter and Panamanian Head of Government Brigadier General Omar Torrijos signed in Washington, D.C., two treaties dealing with the Panama Canal and a new relationship between the two countries. The high profile signing ceremony in the headquarters of the Organization of American States was witnessed by several heads of state from the region and the diplomatic corps. Those treaties are:

• A basic treaty (named the Panama Canal Treaty) governing the operation, management, and defense of the canal, extending through noon December 31, 1999, and
• A separate treaty guaranteeing the permanent neutrality of the canal (Treaty on the Permanent Neutrality and Operation of the Panama Canal).

Purpose of the treaties

In negotiating these treaties, the United States proceeded on the assumption that they would serve the national interest by ensuring that the canal would continue to be efficiently operated, secure, neutral, and open to all nations on a nondiscriminatory basis. Fundamental to this objective was the cooperation of Panama. By responding to Panamanian aspirations, the United States intended to provide a more satisfactory environment for the operation and defense of the canal.

The new treaties provided a basis for a new partnership between the United States and Panama. They replaced the U.S.-Panama Treaty of 1903 (known as the Hay/Bunau-Varilla Treaty), which governed canal operations since the waterway's construction (completed and opened to world commerce in 1914) and subsequent revisions to it by the treaties of 1936 and 1955 which modified some of its terms.