China Defends Panama’s Sovereignty Amid Scrutiny of Li Ka-shing’s Global Ports Sale
By Wang Xiaoqing and Denise Jia
China has thrown its weight behind Panama’s sovereignty and the neutrality of the Panama Canal, as scrutiny intensifies over a controversial deal by Hong Kong billionaire Li Ka-shing’s CK Hutchison Holdings Ltd.
The company is seeking to sell 43 international port assets in a transaction now under global review.
Responding to concerns raised by the Panama Canal Authority, China’s foreign ministry on Tuesday said it firmly supports Panama as an independent, sovereign state and emphasized its opposition to economic coercion and monopolistic behavior in global trade.
“The Chinese side consistently opposes economic bullying,” ministry spokesperson Lin Jian said, while reaffirming China’s respect for the canal’s neutral status and Panama’s legitimate right to defend its interests.
The proposed deal would see CK Hutchison offload key port holdings — including terminals at both ends of the Panama Canal — to a consortium led by U.S. investment giant BlackRock. The group also includes Global Infrastructure Partners and Mediterranean Shipping Company (MSC), which controls around 70% of the port operator Terminal Investment Ltd. (TiL).
Ricaurte Vásquez, head of the Panama Canal Authority, warned that the structure of the deal could overly concentrate port ownership, threatening the canal’s neutrality, and reducing competition among shipping companies.
“There is a potential risk of capacity concentration if the deal proceeds as it is currently structured,” Vásquez told the Financial Times, “If there is a significant share of terminal operations falls under a single shipping company, it will be at the expense of Panama’s competitiveness in the market and inconsistent with neutrality.”
Other shipping firms have echoed these concerns, warning that MSC could gain disproportionate influence over global port infrastructure if the deal proceeds.
The 43-port package includes rights to the Cristobal and Balboa ports at either end of the Panama Canal, along with 41 other international facilities operated by CK Hutchison subsidiaries.
Canal authorities also fear the deal may drive some shipping clients to alternative routes, cutting into the canal’s container traffic and revenues.
Vásquez took aim at past remarks by U.S. President Donald Trump, who once claimed that China was “operating” the canal and suggested the U.S. should take it back. Vásquez dismissed the claim, saying all vessels, including Panama’s own navy, must pay tolls, and no nation receives special treatment.
Lin responded by reiterating China’s support for Panama’s management of the canal and its status as a permanently neutral international waterway.
Meanwhile the deal has faced increasing regulatory hurdles. China’s State Administration for Market Regulation announced in March that it would review the transaction under Chinese law and warned in April that no party should bypass scrutiny or proceed without approval.
The review has delayed the transaction beyond its initial signing deadline of April 2. CK Hutchison and the BlackRock-led consortium had agreed to a 145-day exclusive negotiation window, now set to expire on July 27.
CK Hutchison first responded publicly on May 12, stating the transaction would proceed only with full legal and regulatory compliance. At a May 22 shareholder meeting, co-managing director Lai Kai-ming reiterated that the company would cooperate fully with all required reviews.
Contact reporter Denise Jia (huijuanjia@caixin.com)
caixinglobal.com is the English-language online news portal of Chinese financial and business news media group Caixin. Global Neighbours is authorized to reprint this article.
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