United States Accuses China Of Blocking Panamanian Ships Near Chinese Ports After Panama Port Takeover

On Thursday, March 26, the United States accused China of blocking several Panamanian vessels near Chinese ports as retaliation for Panama’s takeover of the ports of Cristóbal and Balboa, previously managed by the Hong Kong conglomerate CK Hutchison.

Courrier international reported that the United States Federal Maritime Commission said Washington was "watching the situation around the canal very closely" and that Beijing had multiplied disruptions to traffic of ships under Panamanian flag.

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RFI said the tensions were also rekindled after a local authority ordered the demolition of an arch commemorating more than 150 years of Chinese presence in Panama, standing about a hundred meters from the Canal’s entrance in front of the Bridge of the Americas.

RFI quoted Beijing’s response that "China deplores the forcible demolition by the competent local authorities in Panama of a monument to Chinese contributions to the Panama Canal," linking the episode to the broader Canal rivalry.

In the same dispute over the canal’s interoceanic ports, Le marin said Washington accused Beijing of detaining ships under Panamanian flags in Chinese ports after Panama took control of Cristobal and Balboa, which had been controlled by Panama Ports Company (PPC), a subsidiary of CK Hutchison.

Le marin reported that the U.S. Federal Maritime Commission noted a significant increase in inspections of Panamanian-flag ships and said China was imposing a higher rate of detention "under the pretext of checking the state of the ports."

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BFM said Panama took control of Balboa port on the Pacific and Cristóbal on the Atlantic after Panama’s Supreme Court declared the CK Hutchison contract unconstitutional in January, and it described the Asian group as initiating international arbitration proceedings demanding compensation that could reach several billions of dollars.

Le Matin quoted Guo Jiakun, a spokesperson for the Chinese Foreign Ministry, saying "The Chinese side will take all necessary measures to resolutely safeguard the legitimate rights and interests of Chinese companies," after the Supreme Court decision.

The dispute is tied to the legal and commercial future of the canal ports, with Le marin stating that on January 26 the Panamanian Supreme Court ruled the contract unconstitutional that had allowed PPC to manage Cristobal and Balboa since 1997.

Le marin added that the Hong Kong subsidiary is seeking, in response, at least two billion dollars in damages, and it warned that because ships under Panamanian flag account for a significant share of American container traffic, the actions could have "significant commercial and strategic consequences for U.S. maritime transport."

South China Morning Post said Panama’s foreign minister Javier Martinez-Acha used a UN speech to help defuse tension, telling the council, "Dialogue is not a sign of weakness. It is the highest form of trust in reason, in diplomacy, and in the ability of human beings to find peaceful settlements to disputes."

RFI framed the broader risk as threats to the Canal’s Neutrality Treaty, saying Professor Tapia warned that the demolition and Beijing’s reaction reveal growing geopolitical tensions around the Canal, risking the Neutrality Treaty of the Canal, in force since 1979.