This section really is a very short history up until the beginning of the 20th Century but it gives you an idea.
Explored by Columbus in 1502 and by Balboa in 1513, Panama became the principal shipping route between South and Central America in colonial days. After the arrival of the Spanish with their weapons and diseases the native Cuevas and Cocole tribes quickly disappeared.
Panama City however, thrived as Spain concentrated on conquering and plundering Peru. The Spanish caravans loaded with gold traveled overland across the narrow isthmus from Panama City to be loaded on galleons bound for Spain. However, this wealth attracted so many pirates that by the early 1700s, Panama’s Caribbean shore was dotted with so many pirate strongholds that ship owners chose to sail around Cape Horn to Peru instead rather than risk losing their valuable cargo.
In 1821, when Central America finally revolted against Spain, Panama joined Colombia, which had already declared its own independence. For the next 82 years, Panama attempted unsuccessfully to break away from Colombia.
Between 1850 and 1900 Panama had 40 administrations, 50 riots, 5 attempted secessions, and 13 U.S. interventions. After a U.S. proposal for canal rights over the narrow isthmus was rejected by Colombia, Panama finally proclaimed its independence, with U.S. backing, in 1903.
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Panama Canal History
The history of the Panama Canal is fascinating. In the 1880s, Colombia made a treaty with France for the construction of a canal across Panama’s narrow isthmus, but yellow fever claimed the lives of more than 22,000 workers over a five-year period, and construction was halted. Despite Colombia’s objections, one of the French investors negotiated a deal to have the United States construct a canal just at the time that Panama’s independence movement needed tactical and financial assistance.
When Panama declared its independence from Colombia in November 1903, U.S. troops were already present to “protect” the new government. In return for constructing a canal, the new Panamanian government granted U.S. control over rights on either side of the canal “in perpetuity,” and U.S. president Theodore Roosevelt’s “Panama Doctrine” began with the eradication of mosquitoes, which carried malaria and yellow fever. The Panama Canal was completed in 1914 and has remained an important shipping route ever since. For canal rights in perpetuity, the U.S. paid Panama $10 million and agreed to pay $250,000 each year, which was increased to $430,000 in 1933 and to $1,930,000 in 1955. In exchange, the U.S. got the Canal Zone—a 10-mile-wide strip across the isthmus—and considerable influence in Panama’s affairs.
In 1921, the United States paid Colombia US$25 million in exchange for revoking all claims on Panama, and in 1936, the United States itself finally gave up the legal right to use its troops outside the borders of the Canal Zone. With the onset of World War II, the canal became one of America’s most valuable strategic assets and was heavily protected by fleets of U.S. warships.
On Sept. 7, 1977, Gen. Omar Torrijos Herrera and President Jimmy Carter signed treaties giving Panama gradual control of the canal, phasing out U.S. military bases, and guaranteeing the canal’s neutrality.
On Dec. 31, 1999, the U.S. made history and formally handed over control of the Panama Canal to Panama. Panamanians approved a plan to expand the Panama Canal in 2006. It will likely double the canal’s capacity and is expected to be completed in 2014-2015.
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Recent History of Panama
In 1968, the commander of the Panamanian National Guard, Omar Torrijos Herrera, seized control of the government. Although he ruled as a populist dictator, Torrijos Herrera is revered as a hero in Panama’s history because he negotiated the treaty with the United States returning the canal and the Canal Zone back to Panama on January 1, 2000.
After Torrijos Herrera’s death in 1983, General Manuel Noriega became head of the Panama Defense Forces. When Noriega’s party lost the 1989 elections, Noriega’s cronies physically attacked the winning candidate on national television, and Noriega remained in power with the income provided by drug trafficking. In December 1989, Noriega appointed himself dictator and formally declared war against the United States.
The next day, a U.S. soldier was killed by Panamanian soldiers and the most powerful country in the world sent 26,000 troops into the streets of Panama City and Colon. Thousands died in the fighting and ended with Noriega claiming asylum in the Vatican Embassy. The Vatican staff finally released Noriega into U.S. custody, partly to stop the assault of loud rock music that U.S. loudspeakers directed at the embassy compound both day and night. Noriega was arrested, tried, and convicted on money laundering charges and sent to prison for a 40-year sentence.
Still suffering form his beating by Noriega’s cronies, Guillermo Endarra, the winner of the 1989 election, finally took office, but corruption and social unrest were hallmarks of his regime. Ernesto Perez Balladares (El Toro) won the 1994 election with largely fulfilled promises to fight corruption, improve Panama’s economy, and implement nationwide health services. Running with the campaign slogan, “The Canal Is Ours” Mireya Moscoso, the widow of a popular former president and head of the conservative Arnulfista Party, won the presidency in 1999 and celebrated with her 3.3 million citizens when the year 2000 dawned with the canal finally belonging to Panama.
A Short History of Panama City
Panama City, like most cities has been shaped over the centuries by a history of war, fires, invasion, influxes of different peoples and the ups and downs of the economy.
The city was founded on August 15, 1519, by Pedro Arias de Ávila from Spain. Shortly after, the city became a transit point for Incan gold and silver headed towards Spain from Peru. This trade led to the famous fairs of Nombre de Dios and Portobelo.
In 1671, the Welsh pirate Henry Morgan, with the help of a band of 1400 men, attacked and looted the city, which was subsequently destroyed by fire. The ruins of the old city still remain and are a popular tourist attraction known as Panamá la Vieja (Old Panama). It was rebuilt in 1673 in a new location approximately 5 miles southwest of the original city in an area now known as the Casco Viejo (Old Quarter) of the city.
Two years after the start of the California Gold Rush in 1848, the Panama Railroad Company was formed and started operating in 1855. Between 1848 and 1869, the year the first transcontinental railroad was completed in the United States, about 375,000 people crossed the isthmus from the Atlantic to the Pacific, and 225,000 in the opposite direction. This movement of people brought money into the city.
The construction of the Panama Canal was of great benefit to the infrastructure and economy too. Of particular note are the improvements in health and sanitation brought about by the American presence in the Canal Zone. These include the eradication of yellow fever and malaria and the introduction of a first-rate water supply system. However, most of the workers involved in the construction of the canal were brought in from the West Indies, which created some unprecedented racial and social tension in the city.
During World War II, construction of large US military bases brought more wealth to the city than ever before. Panamanians however had limited access, or no access at all, to many areas in the Canal Zone neighboring the city and tensions arose between the people of Panama and the U.S. citizens living in the Panama Canal Zone. This erupted in the January 9, 1964 riots.
In the late 1970s through the 1980s Panama became an international banking center but soon became infamous for international money-laundering. In 1989 after nearly a year of tension between the United States and Panama, President George H. W. Bush ordered the invasion of Panama to depose the leader of Panama, General Manuel Noriega.
As a result of the action a portion of the El Chorrillo, a neighborhood which consisted mostly of old wood-framed buildings dating back to the 1900s, was destroyed by fire. Eventually, the U.S. helped finance the construction of large cinderblock apartment buildings to replace the destroyed structures.
Panama remains a major banking center, although with strict controls against money laundering. Huge sky-rises owned by the banks now dominate the city skyline.
Shipping is handled through port facilities in the area of Balboa operated by the Hutchison Whampoa Company of Hong Kong and through several ports on the Caribbean side of the isthmus.
UncategorizedAugust 12, 2009