Here’s How Much The Panama Canal Is Worth, And Why Trump Wants It Back

Donald Trump has his own real estate empire, but now he’s seeking to expand America’s. Over the holidays and before his inauguration, for instance, he repeatedly issued calls for the U.S. to seize control of Greenland—a territory of NATO ally Denmark since the 1700s and self-governing since 2009. The northern European country has responded by announcing plans to spend more than $2 billion on increasing its military presence in the Arctic.

In his inaugural address on Jan. 20, though, it was not Greenland that Trump cited as his next conquest but rather the Panama Canal. “We gave it to Panama,” he declared, “and we’re taking it back.” Panama’s president, José Raul Mulino, quickly rejected any prospect of a change of ownership, but Trump seems unlikely to give up and is reportedly sending his newly confirmed Secretary of State, former Florida Sen. Marco Rubio, to Panama this week for his first foreign trip. While the chance of Panama selling the canal, either voluntarily or under duress from an imperially minded U.S. administration, is quite unlikely, it raises the question of why Trump cares so much—and, on a related note, what the waterway is really worth.

Forbes spoke to half a dozen experts in the sector and determined that the answer is at least 11 figures. The canal is a phenomenal business; last year, it threw off nearly $3.5 billion in net income on roughly $5 billion in revenue. “Supercore” assets—major bridges, airports and toll roads, for example—can command multiples of 20 to 35 times EBITDA (which would be higher than the net income figure), putting a baseline theoretical valuation at between $70 billion and $120 billion.

But an asset as central to the flow of global commerce as the Panama Canal would command an additional premium. Nearly 10,000 supersized ships carrying some 423 million tons of valuable cargo passed through its locks in 2024. Each ship paid hundreds of thousands of dollars in tolls based on their size and cargo capacity.

Shipping firms gladly pay their way through the Panama Canal because the alternatives are so much worse. “It’s by definition a monopoly asset,” Stephen Dowd, who heads up private infrastructure investing at CBRE, points out. “What’s the competition? You go on a more dangerous route that takes you a lot longer around the tip of South America, or you land somewhere on the West Coast and you put your stuff on a train.” That dynamic boosts any initial multiple higher.

Plus, there’s geopolitics to consider. As a piece of infrastructure, the Panama Canal has just one peer—the Suez Canal in Egypt, which connects the Mediterranean and Red Seas. And the Suez has sparked multiple military conflicts over controlling it. The Panama Canal is similarly indispensable. “The asset offers an alternative strategic value, which in this case is the criticality of the Panama Canal to the US’s strategic, economic and national security,” Matt Neuringer, a partner at Orrick, Herrington & Sutcliffe, says. “You’re in a whole different valuation universe because it has more of an intangible value to the U.S. government.”

As one hypothetical valuation method, Neuringer suggests taking the Canal’s contribution to Panama’s $83 billion annual GDP—estimated by the Canal Authority in 2023 at between three and six percent, or roughly $2.5 billion to $5 billion—and multiplying it by the length of any deal. A 50-year lease could thus put the Canal’s purchase price at a minimum of $125 billion and $250 billion, though that could then be reduced, he notes, if the U.S. commits to some sort of revenue sharing with Panama or takes on future expenses. “I think anything less than that seems to be a tough one for the [Panamanian] government to sell to its people,” he notes. Neither the Canal Authority nor Panama’s embassy in Washington, D.C. responded to requests for comment.

Control over the narrow strip has long been contested. As early as the 1690s, the then-independent Kingdom of Scotland tried to settle the area to create transportation between the seas; the failed colony strained Caledonian finances so badly that Scotland joined the more prosperous England—forming the United Kingdom—just a few years later. In the late 1800s, a French company was the first to try building a canal, but as deaths from disease reached into the tens of thousands, Paris abandoned the effort. After supporting Panamanian independence from Colombia, the U.S. took over construction from the French in 1904, excavated over 240 million cubic yards of earth and opened the canal in 1914. It wasn’t cheap to build, with a price tag at the time of $375 million, equivalent to almost $12 billion in today’s dollars.

In the ensuing decades, Panamanian frustration with American control of the canal grew until Jimmy Carter agreed to return the 10-mile wide Canal Zone, surrendering it to Panama in 1979—and the canal itself in 1999—with the caveat that the U.S. could defend the neutrality of the canal with military force.

An over $5 billion expansion completed by the Central American nation in 2016 enabled the canal to handle larger ships, which in turn boosted the Panama Canal’s balance sheet; revenues increased by about 56% between 2019 and 2024. Trump seems to believe that cash is rightfully American, complaining on Truth Social in December that “The fees being charged by Panama are ridiculous.” Tolls for ships passing through the canal—over 70% of which are going to or coming from U.S. ports—have climbed steeply as drought conditions caused annual crossings to dip by 21% last year.

Trump and some congressional allies have also expressed concern about Chinese control over the Canal (an allegation Panama denies), noting that China-based companies operate ports and other major infrastructure projects in the country that could, theoretically, pose a threat to American canal access in the event of a conflict. “I am grateful to President Trump for raising public awareness about the state of the Panama Canal and the threats to American interests,” Texas Sen. Ted Cruz said at a Jan. 28 Senate hearing about the Canal. “We cannot afford to let American shippers be extorted. We cannot turn a blind eye if Panama exploits an asset of vital commercial and military importance. And we cannot stay idle while China is on the march in our hemisphere.”

If Panama were to refuse a sale, Trump could try to reclaim the Canal with military force—though he may meet opposition from Congress and the international community. “There’s just this massive geopolitical overlay on it,” says Patrick Harder, co-head of North American infrastructure at Norton Rose Fulbright, who declined to offer a possible valuation. “You can’t say what it’s worth because it’s worth what somebody’s willing to sell it for—and I think you have a pretty unwilling seller.”