The United States and Panama signed an agreement strengthening the military relationship between both countries in the face of China‘s perceived influence in the country.

Secretary of Defense Pete Hegseth, who is currently in Panama for the first time since his confirmation, signed the agreement that will allow the U.S. to go “first and free through the Panama Canal” on Wednesday.

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China has played a leading role during his visit this week.

“President Trump has made it clear that the Panama Canal and the canal areas cannot and will not be controlled by China. We are working closely with our partners in Panama to secure the canal,” Hegseth said during his opening remarks at the 2025 Central American Security Conference in Panama City on Wednesday. “China’s military has too large of a presence in the Western Hemisphere.”

The Trump administration has made the security of the canal, which was built by the U.S. more than a century ago, a top priority for its Western Hemisphere policy, warning that Beijing had increased its influence in the passage route.

“We’re also expanding training — military training, increased military education and exchanges, and conducting more robust joint exercises,” Hegseth said. “We’re going to increase cooperation to deter threats, to seize opportunities to bolster our shared defense.”

The two sides will resume joint jungle operations training as well.

They will “increase joint training operations and overall interoperability between our two forces, re- establishing rotational and joint presence at Fort Sherman, Rodman Naval Station, and Howard Air Force base. At Fort Sherman, reviving the jungle school alongside Panamanian forces,” the secretary added. “Our expanded security relationship will also enhance cyber cooperation, information sharing, bilateral security dialogs, and canal infrastructure improvements, these steps are going to help Panama deter and counter malign activity in the areas surrounding the canal.”

As part of the agreement and in coordination with the Panama Canal Authority, the two sides will allow the “expedited transit of warships and auxiliary vessels of the Republic of Panama and the United States,” Hegseth and Panamanian President Jose Raul Mulino said in a joint statement.

The administration’s emphasis on China’s purported influence in the canal is tied to a Hong Kong-based consortium, CK Hutchison Holding, which owns ports at both ends of the canal. The company was in the process of selling its controlling stake to another consortium led by BlackRock, the world’s largest asset management company, but the deal was flagged earlier this week.

The Chinese Embassy in Panama accused the U.S. of using “blackmail” to further its own interests, while Chinese Foreign Ministry spokesman Lin Jian told reporters, “The U.S. side should take a look in the mirror to see who really threatens the sovereignty, security, and development of other countries.”

The U.S.’s stance toward Panama is indicative of a broader foreign policy approach from the Trump administration, in which it is seeking to rectify perceived unfairness and injustices in trade deals and security by applying pressure.

WITH PANAMA ‘IN THE LEAD,’ HEGSETH VOWS US WILL STOP CHINA FROM ‘WEAPONIZING’ CANAL

Trump administration officials also want to expand their partnership with Greenland, an independent territory with ties to Denmark, but have angered locals in their overtures.

The Trump administration maintains the previous administration’s view that Beijing is the U.S.’s biggest threat, and it has gone to the extent of warning Europe it would not be able to continue its leading role in the continent’s defense due to constraints elsewhere, primarily the Indo-Pacific.