Donald Trump used his inauguration address on January 20 to double down on his assertion that the United States would "take back" the Panama Canal, claiming that China had gained control of the strategic waterway.

In remarks that risk inflaming tensions, the newly sworn-in US president asserted that the canal's handover to Panamanian control had been "foolish" and claimed that Panama had broken promises made to Washington.

"We didn't give it to China, we gave it to Panama. And we're taking it back," Trump said in his speech at the Capitol, suggesting he would not rule out military action – a claim he made earlier this month.

The president's comments follow a series of social media posts in late December in which he demanded Panama return the waterway to US control, claiming both "moral and legal principles" had been violated.

Trump also alleged that US military vessels face discriminatory treatment, saying "They are overcharged and not treated fairly." He cited the toll system as evidence of American mistreatment by Panama.

At the same press conference, he declined to rule out using force regarding Greenland, a self-governing Danish territory he has previously expressed interest in acquiring, and made claims about Canadian territory.

In making his case for retaking control, Trump made several false claims about the canal's history, including that it cost more than any other US infrastructure project and that 38,000 lives were lost during its construction.

The latest announcement marks a shift in US policy towards the canal, which was transferred to full Panamanian control in 1999 after nearly a century of American administration. The handover was the result of treaties negotiated by President Jimmy Carter in the 1970s.

Panama’s President Jose Raul Mulino had previously addressed claims about Chinese involvement in a December message, stating emphatically that "there are no Chinese or Chinese troops in the Canal." The government maintains that transit fees are established through public consultation without discrimination against any nation.

While Chinese state-owned firms are not directly operating the canal, Hong Kong-based CK Hutchison Holdings – a privately-owned conglomerate – does manage two ports at the canal's entrances through a subsidiary, raising some security concerns among experts as the formerly British-controlled territory finds itself increasingly under Beijing’s influence. China is the second-largest user of the canal after the United States.

The controversy has sparked regional solidarity, with over 20 former foreign ministers from Latin American countries, including Mexico, Chile, Ecuador, Peru, Costa Rica, and Argentina, issuing a joint statement earlier this month supporting Panama's sovereignty.

Trump's assertions about Chinese waterway control come despite the canal being operated by the Panama Canal Authority, an autonomous government agency. His repeated threats, which analysts believe are aimed at obtaining better transit fees, risk straining diplomatic relations with both Latin America and China at a time of heightened geopolitical tensions.