Discover the main facts on the history of Panama

The History of Panama

Joel Walsh (www.joelwalsh.com) has written for numerous web sites, in addition to the Let's Go: Mexico travel guidebook, and translations for a Venezuelan human rights NGO. At university, he studied Spanish literature and the history of Spanish-speaking countries, spending his final semester at the University of Havana.


Panama is the only country in the world where you can drive a car from the Atlantic to the Pacific Ocean in a couple of hours. This unique feature has made Panama an important crossroads for travel between the two oceans since the arrival of Spain. Before that, it was an important crossroads for indigenous peoples migrating between Central American and South America.




The First inhabitants in the history of Panama

Humanity first came to Panama at least 10,000 years ago, and possibly much earlier.

At the time of Columbus, there were two major indigenous groups in what is today Panama: the Cuevas and the Coclé.

They farmed, but also hunted, fished, and traded amongst their villages. They also made gold jewelry, beads, and colorful pottery, which have been found in their huacas, burial mounds.

They lived in thatched-roof huts, much like the huts many indigenous Panamanians inhabit today (about 5% of Panama’s current population is of primarily indigenous ancestry).

The history of Panama under the Spanish ruling

Spain first explored Panama in 1501 and began settlements in 1508.

The Spanish explorer Balboa made the area famous when he walked across Panama (only 100 kilometers wide) to become the first European to see the Pacific from the Americas, greatly enhancing Europe’s understanding of geography.
Balboa named the Pacific the South Sea, and claimed the ocean and all lands it bordered (!) for Spain.

The Spanish conqueror Pizarro used Panama as a base from which to launch his invasion and conquest of the Inca Empire. He and his men shipped the booty to Panama City, then carried it overland to the Caribbean, where it was shipped to Spain.

This established a trading route that would change the history of Panama for more than a century, until piracy in the Caribbean made shipping so dangerous that ships took the long route around South America to get to the Atlantic. Panama itself was also a target of pirate attacks since it was a temporary storehouse for so much wealth.

Eventually, Panama became part of the Viceroyalty of Peru, the only part of Central America not to end up in the Viceroyalty of New Spain, seated in Mexico City. In 1718, the Viceroyalty of New Granada, consisting of Venezuela, Colombia, Ecuador and Panama, and seated in Bogotá, was split off from Peru.

The history of Panama remained distant from Bogotá troughout this period, developing its own identity apart from the rest of New Grenada, and later, Colombia.

Panama under Colombia: a difficult experience in the history of Panama

When New Granada was liberated during the war for independence led by Bolivar, Panama went with it, becoming part of Gran Colombia and then the Republic of Colombia when Gran Colombia fell apart.

Panamanians staged numerous small revolts during the nineteenth century, but they did not become independent from Colombia until 1903, when the US secured their independence.

The US had already built a railroad across the isthmus, and gained concessions from the Colombian government giving the US the right to use military force to defend it. The railroad entered the history of Panama becoming one of the most profitable in the world, as it allowed for the fastest possible travel between the Pacific and Atlantic Oceans.

The French designers who had built the Suez Canal attempted to build a Panama Canal in the 1880s. Over 20,000 people died in the attempt, mostly from yellow fever and malaria, and the project went bankrupt.

Panama Becomes (Somewhat) Independent

The US intrusion in the history of Panama

The United States eventually decided to buy the canal project and adjacent land from the French company, but could not get the Colombian Congress to allow the sale to go through.

So, the United States, under Theodore Roosevelt, aided and abetted the revolutionaries in Panama, chief among them the businessmen who stood to profit enormously by selling the canal zone to the US.

Under the new Panamanian constitution, the country was a virtual US colony. The US maintained absolute control of a “canal zone” that extended for ten miles in either direction from the canal itself. The US not only gained the right to build military bases, but also a written guarantee that it could invade Panama whenever it wanted to, and had an option to buy as much land adjacent to the canal zone as it wanted.

The US exercised the right to invade often, straight through 1936, when the US agreed to forgo any rights outside the canal zone and the already established military bases.

Panama continued to demand greater respect for its sovereignty. In 1977 a new treaty stated that the use would relinquish control of the canal in 1999, a feat that was eventually achieved with great fanfare following a gradual phase-out during the 1990s.

The Noriega’s dictatorship: a period of corruption and decline in the history of Panama

In the 1980s, Panama fell into dictatorship, breaking a recent streak of relative stability. The dictatorship was controlled by Manuel Noriega, a former CIA operative.

Noriega allowed a level of corruption that was shockingly blatant. Twice Noriega simply fired the country’s figurehead president and replaced him with someone else.

Meanwhile, Noriega not only took a toll on human rights, he got personally involved in the Colombian drug trade, infuriating the US and sullying the history of Panama through his cupidity.

In the late 1980s a federal judge in Florida issued a warrant for Noriega’s extradition to the US, something fairly unheard of for a judge in one country to do to a sitting head of state in another country.

What the US government did next was even more shocking. It invaded Panama in 1989, killing 2000 people on its way to capturing Noriega, who eventually ended up serving a life sentence in a federal prison in Florida.

Legal experts and historians are still debating whether the US action was even remotely legal under US, Panamanian, or international law—after all, the US had already explicitly agreed not to intervene in Panamanian affairs outside the canal zone.

A more interesting, but still unanswered, question is what precedent Noriega ’s capture, extradition, indictment and sentencing might set for US presidents, who routinely are accused of committing felonies in foreign countries, from inciting coups to stifling business competition, not to mention the 2000 people President George Bush (the first) killed during the invasion to capture Noriega and bring him to justice for drug trafficking.

The post-Noriega’s time: propitious features for the future history of Panama

In the wake of Noriega ’s capture, Panama quickly rebuilt its democracy, but the new governments initially had trouble maintaining order.

In particular, the US attack scattered weapons throughout the small country, which many believe has made the country’s crime more violent than it would be otherwise. Meanwhile, while Panama is now less important as a center of the international drug trade, within the country, illegal drugs remain a problem.

In 1999, Panamanians erupted in celebration when the canal and the canal zone were officially ceded to the Panamanian government, in accordance with a 1979 agreement.

Today, Panama is certainly better off than many Central American countries, with an economy that, per capita, is twice as big as those of poorer cousins such as Honduras or El Salvador. Nonetheless, the country still has quite a bit of poverty, as higher incomes are partly offset by higher prices, and wealth is far from being evenly distributed.


Now you know the history of Panama, discover the geography of this country.
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