<Tr> <Td_colspan="2"> Today part of </Td> <Td> Panama </Td> </Tr> <P> The Panama Canal Zone (Spanish: Zona del Canal de Panamá) was an unincorporated territory of the United States from 1903 to 1979, centered on the Panama Canal and surrounded by the Republic of Panama . The zone consisted of the canal and an area generally extending five miles (8.0 km) on each side of the centerline, excluding Panama City and Colón, which otherwise would have been partly within the limits of the Zone . Its border spanned three of Panama's provinces . When reservoirs were created to assure a steady supply of water for the locks, those lakes were included within the Zone . </P> <P> On February 26, 1904, the Isthmian Canal Convention was proclaimed . In it, the Republic of Panama granted to the United States in perpetuity the use, occupation, and control of a zone of land and land under water for the construction, maintenance, operation, sanitation, and protection of the canal . From 1903 to 1979 the territory was controlled by the United States, which had purchased the land from the private and public owners, built the canal and financed its construction . The Canal Zone was abolished on October 1, 1979, as a term of the Torrijos--Carter Treaties of 1977; the canal itself was under joint U.S.--Panamanian control from 1979 until it was fully turned over to Panama on December 31, 1999 . </P> <P> Proposals for a canal across the Isthmus of Panama date back to 1529, soon after the Spanish conquest . Álvaro de Saavedra Cerón, a lieutenant of conquistador Vasco Núñez de Balboa, suggested four possible routes, one of which closely tracks the present - day canal . Saavedra believed that such a canal would make it easier for European vessels to reach Asia . Although King Charles I was enthusiastic and ordered preliminary works started, his officials in Panama soon realized that such an undertaking was beyond the capabilities of 16th - century technology . One official wrote to Charles, "I pledge to Your Majesty that there is not a prince in the world with the power to accomplish this". The Spanish instead built a road across the isthmus . The road came to be crucial to Spain's economy, as treasure obtained along the Pacific coast of South America was offloaded at Panama City and hauled through the jungle to the Atlantic port of Nombre de Dios, close to present day Colón . Although additional canal building proposals were made throughout the 16th and 17th centuries, they came to naught . </P>

When did the us give up control of the panama canal