history

The fact that Panama was only a narrow strip of land between the Atlantic and Pacific made the area important to the Spaniards. Sailing from military bases they established along the Panamanian Pacific coast, the Spaniards explored the west coast of Latin America. They conquered many of the Indian lands they reached. The most important conquest took place in the 1530's, when Spaniards led by Francisco Pizarro defeated the Inca of Peru. They took gold and other riches from the Inca and from other Indians. Spain built a stone road across Panama to transport the riches from the Pacific to the Atlantic coast. The riches then were shipped to Spain.

The Spaniards did little to develop Panama's economy. They treated the Indians harshly and killed many of them. Under Spain, Panama became a center for the distribution of black African slaves in the New World.

In the 1600's, Henry Morgan of England and other pirates attacked Spanish ships and towns in Panama. Many Spanish ships carrying goods from Peru began sailing around the tip of South America to avoid the pirates. Panama declined as a transportation center.