PANAMA CANAL NEGOTIATION STRATEGY

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Introduction Group 1

Nguyen Ha Dan

Tran Ngoc Minh Nhu

Truong Nguyen Hoang Khuong

Tran Hao Quang

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1 Describe Situation

+ Problem 2

Understand the Problem Fully

3 Identify Strategy

4 Result + Lessons learned

The places we will check in

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1 Describe Situation

+ Problem 4

PANAMA REPUBLIC

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Canal Panama

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Canal Panama An international waterway that links the Atlantic and Pacific Oceans.

1. Global Trade Importance

2. Military Importance

3.Panama-Pacific International Relation

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Relationship with American • 1903, November 3 Panama becomes independent. US buys the rights to build the Panama Canal from French • 1914, August 15 Canal formally opened with the transit of Steamer SS Ancon, a cargo ship. • 1977, September 7 The US and Panama sign the Hay-Buneau Varilla Treaty

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Relationship with American • 1999, December 31st Panama gains complete control over the Canal from the US • 2007, June 28th Panama and the US sign the Trade Promotion Agreement: a free trade agreement between Panama and the US

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Problem Ownership of Panama Canal • 1914 - 1999

Progress of 85 years of US military presence and influence

How can a small country like Panama had successful engage negotiation with a powerful

America?

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2 Understand

the Problem Fully 11

Common benefits

• The shortest - connecting the Pacific with the Atlantic.

• Reducing the shipping charges, increase the competitiveness of goods.

• Promote economic exchanges

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Benefits for America Length of ship Fees

~15,240 m (50 ft) 500 USD

15,240 m (50 ft) ~ 24,384 m (80 ft) 750 USD

24,384 m (80 ft) ~30,480 m (100 ft) 1.000 USD

> 30,480 m (100 ft) 1.500 USD

PC/ UMS Fees

10.000 tons 2.96 USD/ton

10.000 – 20.000 tons 2.90 USD/ton

> 20.000 tons 2.85 USD/ton

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Benefits for America

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Benefits for Panama • Revenues 1 billion/year. • Accounting for 10% of government revenues and

6% national economy. • Create 10,000 employments. • Panama became one of the most powerful

economy in the region • GDP increases 8,4% in 2013.

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Third - party

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3 Identify Strategy

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Omar Torrijos

Military Leader of Panama 1929- 1981

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Identify Strategy

He secretly tried to divided tycoon US forces to

get the financial support and able weaken rivals

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Reclaim the sovereignty over the Panama Canal is not simply legal but

also a ethical issue

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Identify Strategy

Omar may destroyed the canal if the US Senate refused to approved the treaty of returning it to Panama

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Identify Strategy

Omar may destroyed the canal if the US Senate refused to approved the treaty of returning it to Panama

Hardball tactics : Intimidation

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4 Result +

Lessons learned 26

Result After the World War II, Panama asked for the possession of Panama Canal. On 7/9/1977, Torrijos - Carter Agreement was signed by Omar Torrijos – Panama President and Jimmy Carter - the U.S.A President Panama Canal officially belongs to Panama on 31/12/1999

Review After 1945, president of Panama, Jose Antonio Remon tried to negotiate with the U.S.A to sign new agreement aimed to increase the share in tax income of Panama Canal. But he died in 1953, 2 years before the new agreement implemented.

Learned Lessons - Make counterpart’s strength to weakness (the U.S.A

democracy is a strength and it is a weakness as well) - Concentrate on a little gain if we are weaker than the

counterpart but never forget the ultimate goal (gain back the possession of Panama Canal).

- People will ask for more and gain more, if they are able to do it. Never negotiate yourself.

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