Panama denied a claim made by the State Department on Wednesday that the Central American nation had agreed to no longer charge fees for US government ships to transit the country’s famous canal.

Washington had suggested Panama had agreed to no longer charge fees for US government vessels using the waterway.

The Panamanian government swiftly shut down a claim by the U.S. State Department that American government ships would no longer have to pay fees to transit the Panama Canal, CNN reports. In a statement,

US government ships will no longer pay to transit through the Panama Canal, the US Department of State said on Wednesday, following fierce criticism from Washington over the administration of the waterway.

Panama President Jose Raul Mulino said on Thursday the United States was spreading "lies and falsehoods" after the State Department claimed U.S. government vessels would be able to pass the Panama Canal without paying.

President José Raúl Mulino on Thursday denied a claim by the Trump administration that this Central American country had agreed to eliminate tolls for U.S. government ships using the Panama Canal, in an apparent setback to U.

The U.S. Department of State said on Wednesday American government vessels can now transit the Panama Canal without charge fees.

Panama President Jose Raul Mulino on Thursday accused the United States government of lying a day earlier when the U.S. State Department claimed that U.S. government vessels would be able to cross the country's namesake canal without paying fees.

Panama President José Raúl Mulino has accused the US of spreading "lies and falsehoods" after the US State Department claimed American government vessels were no longer required to pay a fee to transit through the Panama Canal.