History of the Panama Canal
During World War II, the canal proved a vital part of the U.S. military strategy, allowing ships to transfer easily between the Atlantic and Pacific. Politically, the Canal remained a territory of the United States until 1977, when the Torrijos–Carter Treaties began the process of transferring territorial control of the Panama Canal Zone to Panama, a process completed on 31 December 1999.
Panama–United States relations
The details of the arrangements for U.S. operation and defense of the Canal under the Panama Canal Treaty are spelled out in separate implementing agreements. The Canal Zone and its government ceased to exist when the treaties entered into force and Panama assumed complete jurisdiction over Canal Zone territories and functions, a process which was finalized on December 31, 1999.