Capital of the Republic of Panama, located near the Pacific entrance to the Panama Canal, on the Gulf of Panama. The site was originally an Indian fishing village; the name Panamá means “many fish.” The old city (Panamá Viejo) was founded in 1519 by Governor Pedro Arias Dávila and was made the seat of both secular and ecclesiastical authority. From the Andean countries bullion was shipped northward by sea to Panama City and from there was carried across the isthmus by pack animals to Nombre de Dios or Portobelo on the Caribbean coast for shipment to Spain. The city prospered until the depredations of pirates and privateers curtailed trade. In 1595 Sir Francis Drake tried unsuccessfully to send a force across the isthmus to sack old Panama; in 1671, however, Henry (afterward Sir Henry) Morgan completely destroyed it. The new city (Panamá Nuevo) was rebuilt 5 miles (8 km) west of the old site in 1674 by Alonso Mercado de Villacorta, a Spanish conquistador. Political and economic decline followed, and in 1751 the city and area became part of New Granada and eventually part of Colombia. During the 19th century, Panama was the scene of much disorder. In 1903 independence from Colombia was declared there, and the city was made the national Panamanian capital. During the period 1903–36 the United States was responsible for policing the city.
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