Shortly after his inauguration, President Donald Trump said he wanted to have greater control and influence of the Panama Canal, saying: “We didn’t give it to China. We gave it to Panama, and we’re taking it back.”
On Tuesday, March 4, news came that U.S. firm BlackRock announced a deal to buy most of the $22.8 billion ports’ business of Hong Kong conglomerate CK Hutchison. Notably, this includes the Balboa and Cristobal ports at each end of the Panama Canal, and in all control over 43 ports in 23 countries.
Trump says this is a “reclaiming” of the canal by the U.S., but Joe Raul Mulino, Panama’s president, posted on X Wednesday morning saying the U.S. president was “once again lying… The Panama Canal is not in the process of being reclaimed ... the Canal is Panamanian and will continue to be Panamanian!”
Importantly, the Panama Canal has more than 12,000 ships travel through each year, and of those ships 70% are coming from or going to U.S. ports.
CK Hutchison co-managing director Frank Sixt said in a statement, “I would like to stress that the transaction is purely commercial in nature and wholly unrelated to recent political news reports concerning the Panama Ports.”
Soy Transportation Coalition executive director Mike Steenhoek says the two ports that are part of the BlackRock deal have been under scrutiny as potential avenues for Chinese influence in the operation of the canal.
“The Panama Canal is owned by the Republic of Panama, by the people of Panama,” he says.
Steenhoek points to coincidental timing relative to the Balboa and Cristobal ports.
“Hutchison got the original concession to operate these two ports in 1997,” he says. “That was the same year that the British turned over Hong Kong to the Chinese.”
He also notes the U.S. takes a serious interest in the infrastructure of the canal and its adjacent areas.
“An important detail of the treaty that turned over the canal to the Panamanians was that the canal must be operated in a neutral fashion in perpetuity, and if that neutrality is ever compromised, the U.S. military is justified in intervening,” Steenhoek says.
In February, Secretary of State Marco Rubio visited Panama to discuss any Chinese influence over the canal, which included the ports as well as a bridge under construction crossing over the canal. After Rubio’s visit with Mulino, Panama stopped the Chinese bridge, which is part of that country’s Belt and Road strategy to build roads, ports and railways for global market access. The Panama action was condemned by Beijing.
The BlackRock and CK Hutchison transaction must be approved by the government of Panama.
