Final answer:
The 1977 Torrijos-Carter Treaties were signed to transfer control of the Panama Canal to Panama. This corrected a historical oversight and allowed Panama to embark on significant economic development, including establishing a free-trade zone.
Step-by-step explanation:
The 1977 Torrijos-Carter Treaties were signed to transfer control of the Panama Canal from the United States to Panama. This transfer was a fulfillment of an agreement that some, including President Carter, believed was long overdue and rectified a historical sovereignty issue. Although this decision was controversial and unpopular with many Americans who saw the canal as a source of wealth and military power, it also addressed the view that the US presence in the Canal Zone was not properly authorized by the Panamanian people. The handover was completed in the year 2000, allowing Panama to further its economic development, notably by establishing a free-trade zone and becoming a hub for international banking.
Throughout its history, the Canal Zone had been a strategic location for military exercises and a symbol of US influence in Latin America. President Theodore Roosevelt used Big Stick Diplomacy to secure the rights to build the canal and to influence the political landscape of the region, including supporting Panama's independence from Colombia. The construction of the Panama Canal was a significant engineering achievement and a crucial part of global trade, shortening the distance between the Atlantic and Pacific oceans.