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.

As President Donald Trump's second administration continued its swift recasting of the federal government and American foreign policy, the president and his top diplomat issued a stunning proposal, saying the U.S. would "take over" the Gaza Strip, "level the site" and rebuild it.

The US said Wednesday that its government vessels would sail for free through the Panama Canal, but authorities at the waterway swiftly issued a denial.