The two ports of the Panama Canal are changing hands: Hong Kong-based investment group Hutchison is selling its shares to a consortium of Blackrock and other partners.
The announcement comes just a few weeks after US President Trump claimed that the canal was under the control of China. Hutchinson denies any connection.
The parties said in a joint announcement that 80% of Hutchison Ports, which operates in Mexico, will be transferred to Blackrock, Global Infrastructure Partners and MSC subsidiary Terminal Investment for $23 billion. The terminal operator is active in Balboa and Cristobal, located on the Pacific and Atlantic sides of the Panama Canal. Hutchison Ports also operates 43 other ports in 23 countries – these shares will also be transferred to the consortium.
During his inauguration speech, US President Donald Trump said that the canal was under Chinese control. The governments of Panama and China firmly rejected this accusation, and the head of the Panama Canal also agreed. Although the investment group CK Hutchison Holdings itself is not involved in the operation of the canal, Republican Senator Ted Cruz pointed out that the company’s presence on both sides of the canal violates the 1977 agreement in which the USA transferred the waterway to Panama.
Hutchison’s contract ran for another 20 years
Regardless of the truth of the allegations, Hutchison is now withdrawing from the canal, although the group had only received a 25-year extension for the port operation in 2021. Frank Sixt, co-managing director at Hutchison, said there had been a “swift, discreet but competitive process” in which numerous bids had been submitted. “I would like to emphasize that this transaction is purely commercial in nature and is in no way related to recent political news regarding the Panama ports,” he said.
The Panamanian government had recently distanced itself from China and announced that it would no longer support the Chinese “New Silk Road” infrastructure project. The reaction followed a visit by US Secretary of State Marco Rubio, who reiterated the president’s demands. Trump had repeatedly refused to rule out military means to resolve what he perceived to be a conflict of interest.
