The Panama Canal ports dispute is an ongoing legal and geopolitical dispute concerning the operation and proposed sale of the ports of Balboa and Cristóbal which are located at opposite ends of the Panama Canal. The ports had been operated since 1997 through an indirect subsidiary of CK Hutchison Holdings under concessions granted by the Panama government. The ports are, however, separate from the canal itself, which is administered by Panama.

Following the inauguration of 47th US president Donald Trump, US officials including Trump accused China of exerting undue influence around the Canal and pressured Panama to take action accordingly. Panama subsequently began auditing the port concessions. On 4 March 2025, CK Hutchison Holdings announced plans to sell an 80% stake in its global port business (consisting of 43 ports in 23 countries, excluding port assets in Hong Kong and mainland China) to a consortium comprising BlackRock, Global Infrastructure Partners, and Terminal Investment Ltd (TiL), a subsidiary of Mediterranean Shipping Company (MSC), for approximately US$22.8 billion. US officials welcomed the prospective transfer, while Chinese authorities and pro-Beijing figures in Hong Kong criticised it. Amid regulatory scrutiny, the transaction was postponed.

On 29 January 2026, the Supreme Court of Justice of Panama ruled on social media that the port concession contract held by CK Hutchison Holdings was unconstitutional. The court stated in its ruling that the concession held by CK Hutchison's Panama Ports Company constituted disproportionate favoritism towards the latter and harmed Panama's national fiscal interests without just cause. José Raúl Mulino, the president of Panama, stated that the port would be temporarily managed by Maersk subsidiary APM Terminals Panama following the court ruling. CK Hutchinson rejected the ruling and initiated arbitration procedures; the Chinese and Hong Kong governments condemned the court decision, while the United States welcomed the court decision. As of August 2026, the dispute remains the subject of multiple international arbitration claims.

Background

CK Hutchison's Panama Canal operations Hutchison Ports Limited, a subsidiary of CK Hutchison Holdings, has been operating ports in Panama since 1997, managing the ports of Balboa (Pacific Ocean side) and Cristóbal (Atlantic Ocean side) through its subsidiary, Panama Ports Company. These ports are located at both ends of the Panama Canal and are of strategic importance to global trade. In 2024, Balboa handled approximately 2.63 million twenty-foot equivalent units (TEUs) while Cristóbal handled approximately 1.1 million TEUs. CK Hutchison was granted a 25-year franchise extension in 2021, until 2047.

Pressure from the United States The second Trump administration had been dissatisfied with China's expanding influence in Latin America, especially the control of ports at both ends of the Panama Canal by Chinese companies. In his 2025 inauguration speech, Trump accused China of "operating the Panama Canal" and vowed to "[take] it back". US secretary of state Marco Rubio issued an ultimatum to the Panamanian government, demanding that China immediately reduce its influence in the canal or face "measures" that were not specified. US Secretary of Defense Pete Hegseth criticized China's influence in the Panama Canal region at a regional security conference and announced an agreement with Panama that would allow US warships priority and free passage through the canal.

Despite the Panamanian government's insistence that it has full control over the canal and that the operation of the port by CK Hutchison does not mean that China controls the canal, under this pressure, the Panamanian government began to reassess its relationship with China, including withdrawing from the Belt and Road Initiative.

In January 2025, before taking office, President Trump threatened not to rule out using force or economic coercion to reclaim the Panama Canal. The Panamanian government began auditing local subsidiaries of Hutchison Ports, raiding their offices and reviewing the 2021 Panama Canal port operation concession contract, which was criticized for its lack of transparency and limited benefits to the Panamanian economy. The Panamanian government claimed to have found several irregularities in the 25-year concession contract signed by the company in 1997, including failure to pay due amounts, accounting errors and failure to report company operations, resulting in a loss of approximately US$300 million for Panama. The Panamanian Comptroller General Anel "Bolo" Flores stated that the audit results would be submitted to the Panamanian Maritime Authority, which has the authority to terminate the contract with CK Hutchison. CK Hutchison denied the allegations made by the Panamanian authorities.

In February 2025, Secretary of State Marco Rubio visited Panama. He stated that China's influence on the canal was "unacceptable" and had violated the neutrality treaty of the Panama Canal. He demanded immediate changes, otherwise the United States would take action to defend its rights. In the same month, the Supreme Court of Justice of Panama filed a lawsuit to cancel Hutchison Ports’ port operation contract in the Panama Canal. In addition, the Panamanian Attorney General's Office has filed a lawsuit against relevant officials, accusing them of harming national interests when renewing the port concession agreement in 2021. The report indicated that Panama's actions were seen as an attempt to appease the United States and reduce China's influence in the region.

Events

Sale of assets Against the backdrop of increasing pressure from the US and Panama governments, CK Hutchison announced on 4 March 2025, that it had reached an "in principle" agreement with the "BlackRock-TiL Consortium", consisting of US investment firm BlackRock, Global Infrastructure Partners and Terminal Investment Ltd of the Mediterranean Shipping Company, to sell most of its global port business to the consortium for a total value of US$22.8 billion. The transaction is divided into two parts: CK Hutchison sells 80% of its stake in 43 ports in 23 countries around the world, totaling 199 berths, including all management resources, operations, container terminal systems, information technology and other systems. It also sells its 90% stake in the ports of Balboa and Cristóbal at both ends of the Panama Canal held by Panama Ports Corporation. However, the transaction does not include Hutchison Port Trust's operations in Hong Kong or any ports in mainland China.

According to the agreement, the Panama port transaction can only proceed after the Panamanian government confirms the proposed acquisition and sale terms. The completion of the overall transaction is also subject to conditions such as the BlackRock-TiL consortium conducting confirmatory due diligence, signing final documents, and obtaining necessary regulatory approvals. The transaction is expected to bring more than US$19 billion in cash income to CK Hutchison after adjusting for minority interests and repaying CK Hutchison loans. There are also reports that although the new buyer is the "BlackRock-TiL" consortium led by BlackRock, the assets will eventually be managed by the Italian MSC Mediterranean Shipping Company Group (TiL's parent company) after the transaction.

Share prices Following the announcement of the deal, CK Hutchison's share price surged in the Hong Kong stock market. On 5 March 2025, the share price rose by more than 22%, reaching its highest level since August 2023. On 6 March, the share price rose further by 12.4%, reaching HK$52.95 per share, a new high since May 2023. However, after the Chinese government took a negative view of the deal, CK Hutchison's share price fell. On 14 March, the share price fell 6.7%, marking the largest single-day drop in about five years.

Pressure from China Party and state leaders expressed clear concern about CK Hutchison's sale of the Panama port. On 17 February 2025, Chinese leader Xi Jinping attended a symposium on private enterprises in Beijing, releasing an atmosphere of support for the private economy. Some commentators pointed out that the authorities initially expressed principled support for the sale. However, the authorities later changed their attitude. The State Administration for Market Regulation stated that it would conduct an anti-monopoly review of the transaction, which could last up to 180 days, in order to ensure fair market competition and safeguard the public interest.

In addition, the pro-Beijing Hong Kong newspaper Ta Kung Pao published a commentary on 13 March 2025 entitled "Don’t be naive or confused", pointing out that netizens generally criticized Hutchison Ports for selling the Panama Canal-related assets, believing that "this is a spineless kneeling". The article was also reprinted on the website of the Hong Kong and Macao Affairs Office of the Central Committee of the Chinese Communist Party, showing the official strong dissatisfaction with the transaction. The share price of CK Hutchison fell sharply the day after the article was published. Ta Kung Pao subsequently published three commentaries criticizing the CK Hutchison Group's transaction for potentially harming national interests. On 15 March, Ta Kung Pao published a commentary entitled "Great entrepreneurs are all staunch patriots", emphasizing that "great entrepreneurs are never cold-blooded speculators, but rather passionate and proud patriots". However, some commentators have said that in addition to the very generous offer from BlackRock, it is also possible that the offer was made under pressure from the United States. On 17 March, Leung Chun-ying, vice chairman of the National Committee of the Chinese People's Political Consultative Conference, indirectly responded to the matter on his Facebook page, saying that "some Hong Kong businessmen mistakenly believe that businessmen have no motherland and think that everything is about business."

On 18 March 2025, Hong Kong chief executive John Lee Ka-chiu made a statement on the matter, saying that the public's concern about the incident deserves attention, and emphasized that the Hong Kong government opposes foreign governments exerting coercion or pressure on Hong Kong enterprises. Any transaction must comply with the requirements of laws and regulations, and the SAR government will handle it in accordance with the law and regulations. On the same day, Mao Ning, spokesperson for the Chinese Ministry of Foreign Affairs, responded to related questions at a regular press conference yesterday, saying that China has always firmly opposed the use of economic coercion and bullying to infringe upon and damage the legitimate rights and interests of other countries.

Transaction postponement