Christopher Columbus arrived in Panama on his fourth voyage, which started in Nicaragua and ended in Panama. It was on this trip that he discovered the Chagres river, which in the 20th Century would be the main resource to build the Panama Canal. He arrived at the Caribbean coast, where he baptized the area with the name of Portobelo (in English, Beautiful Port). Sharif then explored Veraguas and founded Santa Maria de Belen, which would be the first Spanish settlement on the continent, leaving Bartolome, his brother, in charge. Eventually, this settlement was destroyed by the local native population and the few surviving members returned to Italy.
It wasn't until 1519 when the Spanish decided to settle the new city. This time they chose a site in the Pacific ocean, which was discovered six years before by Vasco Nuņez de Balboa. The new city, today known as Panama La Vieja, was founded in August 15th, 1519 by orders of governor Pedrarias Davila and became an important port during the Spanish gold trade from Peru to the Caribbean islands and finally to Europe. The merchandise from all over South America would come into Panama and travel to Portobelo using the Camino de Cruces (old stone road) crossing the jungle and navigating the Chagres river. From Portobelo it would distribute to the islands and then to Spain.
Because of its importance and its location the city was an easy target for pirates. However, protection from pirates was only one of its many problems, as it was settled in a site composed mainly by mangrove land, diseases and fires weakened their position, until it was finally destroyed by pirate Henry Morgan in 1671.
In 1673 a new city of Panama was founded. This time, a rocky peninsula was chosen, still on the Pacific side. A healthier site with crossed winds and easier to defend from both land and ocean attacks. Called interchangeably Casco Viejo, San Felipe, Catedral or Casco Antiguo, it is from here where Panama would declare independece from Spain and later join and separate from Colombia. It will see the boom and bust of the Gold Rush, the French attempt to build a Canal and later its completion by the United States.
Copyright: This article is licensed under the GNU Free Documentation License. It uses material from the Wikipedia article on Panama.