Panamanian President Backs Lawsuits That Threaten Sale of Panama Canal Ports
Udumbara
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Panamanian President José Raúl Mulino on Thursday signaled that the Central American nation may take control of two ports at either end of the Panama Canal, potentially threatening the $22.8 billion sale plans of the ports’ current owner, Hong Kong-based conglomerate CK Hutchison, to a U.S.-based investment company.
Panama Ports Company, 90 percent owned by CK Hutchison, has operated the Balboa and Cristobal ports since 1997 and renewed a 25-year concession in 2021.
Flores on Thursday criticized the renewal as “unfair” and “abusive,” alleging that it was signed without proper authorization and failed to deliver adequate financial returns. His first lawsuit seeks to outright nullify the concession, while the other asks the court to declare it unconstitutional.
“The ports are ours; they belong to the Republic of Panama, and therefore to all Panamanians,” Flores declared at a press conference on Thursday. “It doesn’t seem right to me that other people, in other places, are negotiating the future of assets that belong to us, the Panamanians.”
The lawsuits have the backing of Mulino, who also endorsed an April 7 audit of Panama Ports Company by Flores’s office, citing alleged royalty underpayments and irregularities in the concession renewal. The results of that audit have yet to be released.
“The Court now has a decision in its hands regarding the Comptroller’s well-founded claim. We will wait for the verdict,” Mulino said on the lawsuits at the press conference on Thursday.
“The country will be fully informed about the decisions when they are made,” he said. “But at this moment, I don’t see the continuation of that Panama Port [Company] contract, amended or not.”
Should the court rule in favor of Flores, it could complicate U.S. asset management giant BlackRock’s bid to gain control of the strategic shipping lanes.
In March, BlackRock, along with Switzerland-based Mediterranean Shipping Company, formed a buyer consortium to acquire Panama Ports Company as part of a broader deal involving 42 CK Hutchison-owned container terminals worldwide. The deal remains subject to approval from the Chinese regime.
Since the announcement of the deal, Chinese state-aligned media have launched a coordinated propaganda campaign targeting CK Hutchison and its founder, 96-year-old billionaire Li Ka-shing.
Ta Kung Pao, a Hong Kong-based newspaper linked to the Chinese Communist Party (CCP), published a series of blistering commentaries accusing Li of “betraying and selling out all the Chinese people” and urging him to “think carefully about what position and which side to stand on.”
Li, who officially retired in 2018, is personally involved in negotiating the port deal that’s widely seen as an effort to offload assets caught in escalating geopolitical tensions between China and the United States.
Since his reelection, U.S. President Donald Trump has repeatedly suggested that the United States should regain control of the Panama Canal, citing overcharges for its use on U.S. ships and the CCP’s growing influence over the key waterway.
CK Hutchison and the White House did not respond to requests for comment by publication time.
BlackRock declined to comment.
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