#Geopolitics

PANAMA CITY (The Pak Global Pakistan) – Panama’s President José Raúl Mulino has firmly rejected a warning from China that the country would face a “heavy price” after a Hong Kong-based firm lost control of two key ports on the Panama Canal.

In a post on social media platform X, President Mulino said Panama would not be intimidated and stressed that the country respects the rule of law and the independence of its judiciary. His response followed sharp remarks from China’s Hong Kong and Macao Affairs Office after Panama’s Supreme Court annulled the port concession held by CK Hutchison.

The court ruled that the concession was unconstitutional, stating it was heavily skewed in favor of the company, lacked proper justification, and caused losses to the state treasury. The decision came amid mounting pressure from the United States, where President Donald Trump had threatened to reclaim the US-built canal, citing what he described as excessive Chinese influence.

China reacted angrily to the ruling. According to Bloomberg, Beijing’s Hong Kong affairs office accused Panama of giving in to foreign pressure and warned that continuing on this path would carry serious political and economic consequences.

President Mulino condemned the remarks as unacceptable interference, reiterating that Panama is a sovereign nation governed by law. He added that the foreign ministry would issue an official response and take appropriate steps.

The Panama Canal, a vital global trade route linking the Atlantic and Pacific oceans, handles roughly 40 percent of US container traffic. CK Hutchison has managed the Cristobal and Balboa ports since 1997, with its concession extended for 25 years in 2021.

After renewed scrutiny last year, Panama’s comptroller general reviewed the contract and advised its cancellation, a recommendation later upheld by the Supreme Court. Following the ruling, the government appointed Denmark’s Maersk to temporarily operate the ports until a new concession is granted.

The dispute has become a symbol of growing US-China rivalry in Latin America. China’s foreign ministry has vowed to protect the rights of its companies, while accusing Washington of acting with a “Cold War mentality” and undermining international law.

The ruling also comes as CK Hutchison’s proposed $22.8 billion deal to sell its Panamanian port assets to a consortium led by US investment firm BlackRock remains uncertain, after Beijing warned the transaction could harm China’s global interests.