Panama promotes itself “as the bridge of the world, heart of the universe” but lately the narrow Central American Isthmus and its namesake canal that joins the Atlantic to the Pacific have become the setting for a bitter clash between the world’s two preeminent economic superpowers.

Panama and the U.S. signed a new security pact on the canal, boosting defense ties as tensions with China over Latin American influence continue to rise.

The United States has reaffirmed Panamas sovereignty over the Panama Canal during U.S. Defense Secretary Pete Hegseths recent visit, the first by a Pentagon chief in decades. Despite strong rhetoric from Washington,

US Secretary of Defense Pete Hegseth said that he would sign a declaration with Panama Wednesday on the security and operation of the Panama Canal to allow U.S. warships to "sail first and free."

Panama said on Wednesday the United States recognized its sovereignty over the Panama Canal, despite tough rhetoric from Washington, as the two nations announced agreements to deepen U.S. military training in the Central American nation.

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