Panama Canal

The Panama Canal is the interoceanic canal between Atlantic and Pacific, controlled by the US and operational since 1914. It has been useful to the Royal Canadian Navy as well as to Canada-bound commercial shipping. Prime ministers Robert Borden and Arthur Meighen argued successfully for strict enforcement of US-UK treaty obligations guaranteeing a uniform fee structure to all vessels using the canal. Any alternative, they said, would benefit ports in the northern US at the expense of Canadian ports.

Controversy erupted in the 1920s when the Panama Canal undercut Canadian railways in shipments from eastern Canada to Alberta and BC. Effective lobbying by Canadian railway interests persuaded PM Mackenzie King to maintain tariffs against commodities re-entering Canada via the Panama Canal. The canal also proved useful during the energy crisis of 1973-75 for shipments of Alberta oil to Montréal and Atlantic Canada.