Trump: China's influence on the Panama Canal - how deep are the connections?

Trump: China's influence on the Panama Canal - how deep are the connections?

In a significant political turn, Donald Trump started his second term as president and increases the pressure on Panama by threatening to "recover" the Panama Canal. He accuses the country to hand over control over this important waterway to a rival of the United States, namely China. In his speech on the inauguration, Trump explained: "Above everything it says that China is doing the Panama Canal. And we didn't give it to China. We gave Panama and we'll get it back."

China's influence on the Panama Canal

However, there is no evidence that China actually controls the channel. The channel is operated by an independent authority appointed by the Panamaian government. Beijing repeatedly denied that he had intervened in the operating processes of the channel. The concern of the United States is increasing, while the Trump administration wants to strengthen its national security interests, especially in its own back yard, and gain economic competition with China.

political reactions in Panama

Panama's President José Raúl Mulino emphasized that Panama's sovereignty over the canal is not up for debate, but has also reacted to the pressure of the USA. After a meeting with the US diplomat Marco Rubio Last week, Mulino announced that Panama from China's "Belt and Road" initiative would leave what is a setback for Beijing, since Panama was the first country in Latin America that was joined by the program.

The role of Chinese companies

The concern of the United States is partly based on the fact that a company based in Hong Kong runs two important ports at both ends of the 50 miles long waterway. This company is part of a consortium operated by CK Hutchison Holdings, one of the largest port operators in the world. Despite these connections, however, the operator does not control access to the channel itself; The Panama Canal Authority ensures that merchant ships are led by local captain: inside.

strategic risks and American interests

The concerns of the US officials are created in the context of a global review of China's efforts to ensure access to trading sports worldwide. Observers warn that the engagement of Chinese companies in the Panama Canal Beijing could possibly provide a strategic leverage, especially in the event of possible conflicts with the USA. Rubio explained that a "foreign power" was able to "transform the channel into a bottleneck in the event of a conflict".

The bilateral relationships between China and Panama

The state visit by Chinese President Xi Jinping in Panama in 2018 illustrated the great interest of Beijing to expand relationships with this strategically important country. The two countries signed a number of agreements on cooperation in the areas of trade, infrastructure and tourism, and XI described these relationships as a "new section". Although Panama has been supported by Chinese investments in the past, the new government has initiated a larger examination of such plans.

outlook: China's future role in Panama

Panama's decision to withdraw from the Belt and Road initiative could herald a new exam cycle for China's presence in the country. However, China is expected to continue investing in Panama if the country needs this. Experts believe that China's interest in strategic nodes such as the Panama Canal remains, but the country could also strive for further progress in areas with less resistance.