China Warns Panama Over Ruling on Canal Ports

China Warns Panama Over Ruling on Canal Ports

China has issued a stark warning to Panama following a recent court ruling that nullified a contract between a Hong Kong-based firm and the Panamanian government. The ruling by Panama's Supreme Court to cancel the contract of CK Hutchison's subsidiary, the Panama Ports Company, has been condemned by Beijing as 'absurd,' 'shameful,' and 'pathetic.'

The Chinese government accused the Panamanian court of ignoring facts, breaching trust, and damaging the legitimate rights and interests of enterprises from Hong Kong, China. The statement emphasized that Panama's decision would have serious political and economic consequences, warning that 'heavy prices' would be paid if the ruling is enforced.

The ruling followed concerns raised by US President Donald Trump about Chinese control over the Panama Canal, which he claimed posed a security threat to Washington. While not explicitly naming the US, China criticized what it described as 'bullying tactics' and accused Panama of succumbing to hegemonic powers. Meanwhile, a Danish firm, Maersk, has temporarily taken over the operation of the two ports affected by the ruling.

The Panama Canal is a strategic waterway connecting the Pacific and Atlantic oceans, handling about 40% of US container traffic and 5% of global trade. The canal's construction was financed by the US, which operated it for a century before transferring control to Panama in 1999. This dispute underscores the high stakes involved in controlling such vital trade routes.