Panama has launched an investigation into the port operator Panama Ports Co, a subsidiary of CK Hutchison Holdings (Hong Kong).
This decision comes after the new US President, Donald Trump, laid claim to the Panama Canal. The review concerns the 25-year concession for two ports near the Panama Canal – Balboa and Cristóbal.
Auditor General Anel Bolo Flores explained that Panama wanted to ensure it benefited appropriately from the increasing cargo volumes. The concession was awarded in 1998 and renewed in 2021, but according to Flores, the conditions are no longer up to date.
The review comes at a time of growing geopolitical tensions. In his inauguration speech on 20 January, Donald Trump accused Panama of granting China too much influence over the canal. He announced that he would “take back control of the waterway”.
Panama’s President rejected the accusations
Trump has not yet provided any evidence for his claims. Panama’s President Jose Raul Mulino immediately rejected the accusations and reiterated that the canal would remain fully under Panamanian control.
However, the allegations against Panama Ports Co. have put CK Hutchison in the spotlight. The company is owned by Hong Kong billionaire Li Ka-shing and operates nine other ports in Central America. The group’s port division contributed around 15% to total profits in 2024, but benefited above all from increased cargo handling in Mexico and the Bahamas.
Uncertainties now loom: Trump’s trade agenda includes new tariffs of up to 25% for Mexico and Canada, which could worsen business prospects in the region. Political pressure on Hong Kong is also growing.
The new US Secretary of State, Marco Rubio, is advocating the closure of Hong Kong companies’ trade missions in the US. A corresponding law could further weaken the city’s global position. While the shares of CK Hutchison were largely stable, other companies with close ties to China are coming under increasing pressure.
The Panama investigation could become the next bone of contention in US-Chinese tensions. Trump’s threat to “take back” the canal can be seen as symbolic rhetoric. Legally, politically and practically, a takeover is unrealistic. The use of military force would be a violation of international law and would result in a break in diplomatic relations.
The canal is sovereign Panamanian territory and any intervention would be a violation of the UN Charter. The negotiation of a new treaty with Panama is also highly unlikely, especially as the Panama Canal Authority (ACP) manages the canal efficiently and has invested a lot of money in recent decades. (rup)
