Panama Canal is 'innocent passage'

Passageway will continue servicing Venezuelan ships despite US sanctions

Famously neutral Panama is resisting pressure from the United States to stop allowing Venezuelan vessels to traverse the Panama Canal, the key link between the Atlantic and Pacific oceans and one of the most important passageways for global trade.

The US has been building fences around the Venezuelan government since the US administration moved on Aug 5 to impose sanctions on the government of Venezuelan President Nicolas Maduro, which the US opposes. The sanctions aim to cover Venezuelan ships moving through the Panama Canal.

But those fences have some big holes and none bigger than the Panama Canal, an 82-kilometer passageway through which about 5 percent of global trade moves and which links Venezuela with Asia-Pacific markets.

Panama has said it will continue servicing Venezuelan vessels despite the US sanctions, according to Panama Canal Authority chief Jorge Quijano. He said in a statement that Panama is signatory to a treaty of neutrality and that the canal is "an innocent passage".

Asked about possible sanctions against Venezuelan vessels, Humberto Jiron, a Panamanian lawyer and former ambassador to the European Union and to the International Maritime Organization, said his country has no reason to accept the internal policies of the US government.

"There is a constitutional chapter that allows the administration of the Panama Canal to be absolutely independent," he said. "The canal works at the margin of politics, and that is the reason why it is so successful, and why it works so well, or even better than when it was managed by the Americans."

The Panama Canal has remained neutral since its inauguration in 1914. Even during World War I and World War II, when the canal was administered by the US, its safe-passage status was sustained and no transits were prohibited.

Politically neutral

In 1977, Panama and the US signed a treaty concerning the permanent neutrality and operation of the Panama Canal. Panama has continued to remain politically neutral during the years since the canal was handed over to the Latin American country.

Daniel Di Martino, a Venezuelan economic analyst, said Panama under Laurentino Cortizo, who was sworn in as the country's president on July 1, is not likely to stop any ships from making their way through the canal. The Panamanian authorities know the US needs the canal, but they were willing to go ahead despite US threats of sanctions, Di Martino said.

Panama's decision not to enforce US sanctions on vessels moving through the canal is doing little to reassure humanitarian organizations who fear the sanctions will push Venezuela deeper into economic crisis.

"The economic impact of these sanctions will be to reduce overall imports in a context in which millions of ordinary Venezuelan people are already highly vulnerable," said a joint statement signed by 16 NGOs from all over the Americas and shared by the Washington Office on Latin America. "The Trump administration's announcement is premised on the idea that imposing broad economic sanctions will force regime change in the short term."

The US backs Venezuelan opposition leader Juan Guaido and is betting that sanctions will put more pressure on Maduro's government.

However, analysts like Richard Nephew, a senior research scholar at the Center on Global Energy Policy at Columbia University' in New York and author of the book The Art of Sanctions: A View from the Field, do not agree that sanctions that destroying Venezuela's economy.

"The primary damage being done to Venezuela's economy stems from the poor policies of the government rather than sanctions," Nephew said.

"Sanctions are further undermining his (Maduro's) flexibility and options to address those policies, creating pressure."

Nephew said he is not surprised that Panama's authorities have decided to allow goods to transit through the canal.

"The Panamanians believe they have legal obligations that require them to act this way," he said. "I do not see the US sanctioning the Panama Canal over it."

The author is a freelancer for China Daily.