The Panama Canal treaties to be signed tonight are the product of 13 years of U.S. Panamanian negotiations and 74 years of history.

For large numbers of Americans, the transfer of the canal to Panama is a puzzling "giveaway" of a major U.S. asset created by Yankee ingenuity, sweat and dollars.

But for Panamanians and many other Latin Americans, the new canal treaties are the long-delayed redress of a historic wrong and the end to an era of Yankee colonial domination.

"We bought it, we paid for it, we built it," declared former California Gov. Ronald Reagan in campaign oratory last year against the "giveway" of the canal by the United States and its operation forever under favorable conditions, President Theodore Roosevelt virtually created the country of Panama in 1903 as a complaint negotiating partner.

Late in the 19th century a French company went broke trying to dig a canal between the Atlantic and Pacific oceans across the steamy jungle of Panama, which was then an obscure province of Colombia. About the turn of the century Roosevelt became interested in the project and pressed Colombia to sign a treaty allowing the United States to dig and operate a canal.

Colombia refused, but Roosevelt would not take no for an answer. Arguing that Colombia "jackrabbits" should not be permitted to bar "one of the future highways of civilization," Roosevlt encouraged the province to secede from Colombia and sent a U.S. gunboat and troops to make sure the "rebellion" succeeded.

On Nov. 18, 1903, two weeks after the secession, Washington signed a treaty with the infant "Republic of Panama" providing U.S. rights in perpetuity over a 10-mile zone bisecting the country as the site of the future canal. "I took the Canal Zone," Roosevelt later boasted. Secretary of State John Hay, who signed the treaty for the United States, called it "vastly advantageous to the United States and, we must confess, not so advantageous to Panama."

The clouded origin of the 1903 treaty and Canal Zone was little known to Americans, but the engineering and construction feat that followed stirred public pride. Costing $387 million and the lives of 32,000 people - who died of malaria, yellow fever, other diseases and accidents - the building of the canal was a historic achievement.

"It was the moon shot of the day," former Canal Zone Gov. David S. Parker said recently.

Since the grand opening of the canal on Agu. 15, 1914, the 51-mile-long waterway has won a place in world commerce and military strategy. During World War II, 24 million tons of military supplies passed through, saving 8,000 miles and about 30 days over the Cape Horn route around South America. During the Vietnam war, about 70 per cent of the cargo for the war zone passed through the canal.

Today the largest U.S. aircraft carriers and supertankers are too big to navigate the canal, and its economic importance is declining. Only about 4 per cent of U.S. coast-to-coast trade uses the canal, less than half the proportion of a decade ago. The canal is considered by U.S. authorities to be militarily and economically important but not as vital as in the past.

Half a century after its creation, the Republic of Panama increasingly was imbued in the 1950s and 1960s with the nationalistic spirit that swept the rest of the "Third World." To this country of 1.7 million people and 29,200 square miles - almost the size of Maine - the U.S. operation of the canal and the Canal Zone under the 1903 treaty was a vestige of colonialism and a national indignity.

In 1964, mounting tensions erupted into riots over the issue of the flying of the Panamanian flag in the Canal Zone. Four Americans and 20 Panamanians were killed and 80 other people injured. Panama broke diplomatic relations with the United States and took its case to the United Nations and the Organization of American States.

President Johnson, after consuliting former Presidents Eisenhower and Truman in a bid for bipartisan support, agreed to renegotiate the 1903 treaty. Three draft treaties were agreed upon in 1967, but no action was taken toward ratification in either country due to their controversial nature.

The Panamanian government formally rejected the drafts in 1970 after Gen. Omar Torrijos took power in a bloodless coup with the canals as his major issue.

Talks resumed in 1971 but gained momentum only after the United States vetoed a U.N. Security Council resolution supporting Panama in 1973.

In 1974, Secretary of State Henry A. Kissinger signed a "statement of understanding" for the Nixon administration, agreeing to principles for a new treaty of limited duration.

President Ford continued the negotiations but, faced with a right-wing challenge in the Republican Party and a tough race last year for election, he did not push for an early conculsion.

During the presidential campaign Jimmy Carter took a cautions position, favouring a treaty but saying he would not give up "practical control" of the canal.

After the election, Carter called the issue a "festering problem" for the United States in Latin America and instructed his negotiators to push full speed ahead to a new arrangement by June, 1977, if possible.