A republic occupying the Isthmus of Panama, between North and South America. The area was a department of the Republic of Colombia until 1903 when U.S. intervention enabled the Panamanians to secure their independence. The new Panamanian government immediately conceded to the United States a 10-mile wide strip of land bisecting the isthmus. Construction of the Panama Canal began the following year and was completed in 1914. While the Panamanian economy benefited greatly from the Canal, the presence of a foreign sovereignty on their soil was a constant irritant to Panamanians' national pride.
U.S.-Panamanian relations deteriorated over the status of the Canal,
which became an emotionally charged issue throughout Latin America. In
1978 a revised Canal treaty was ratified by the U.S. Senate. Implemented
in 1979, this treaty provides for the gradual transfer of authority,
with full Panamanian ownership by December 31, 1999. Panama assumed
political sovereignty in the Canal Zone on Oct. 1, 1979. During the
1980s, Panama was under the control of Gen. Manual Noriega. Noriega's
repression of political opposition and involvement in drug trafficking
led to increasing conflict with the United States during 1986-1989. U.S.
forces invaded Panama, deposed Noriega, who was returned to the United
States for trial, and installed a government led by the Noriega