A Hong Kong-based company has agreed to sell the majority of its stake in two major ports on the Panama Canal to a consortium led by US investment firm BlackRock. The deal, valued at $22.8 billion (£17.8 billion), includes ports located at both the Atlantic and Pacific entrances to the crucial waterway.
The move comes amidst growing political tension, particularly from former President Donald Trump, who has repeatedly raised concerns over Chinese control of the canal. Trump has called for the US to reclaim control of the strategic shipping route, claiming that Chinese influence poses a national security threat.
The company involved, CK Hutchison Holding, operates the two Panama Canal terminals through a subsidiary and has managed these ports since 1997. Despite being based in Hong Kong, CK Hutchison, founded by billionaire Li Ka-shing, is not owned by the Chinese government but is subject to Chinese financial regulations due to its location. The sale, which also encompasses 43 ports across 23 countries, will require approval from the Panamanian government.
The Panama Canal, a 51-mile (82km) passage through Central America, serves as a vital connection between the Atlantic and Pacific Oceans. It handles the passage of up to 14,000 vessels annually, including container ships, military vessels, and cargo ships carrying natural gas, cars, and other goods.
The canal’s control has shifted over time. While the United States maintained authority over the canal zone until 1977, Panama took full control in 1999 following a period of joint management.
Trump’s concerns over the canal have sparked controversy, particularly regarding the Chinese role in port operations. The former president argued that US investment in the canal’s construction warranted regaining control, and criticized the fees charged to American ships. During a visit to Panama in February, US Secretary of State Marco Rubio echoed Trump’s concerns, demanding that Panama address what he referred to as “Chinese influence” over the canal.
However, Panama’s government has rejected these claims. President Jose Raul Mulino reaffirmed that the Panama Canal remains under the country’s full control. In response to the sale, Frank Sixt, co-managing director of CK Hutchison, emphasized that the transaction was a commercial decision, unrelated to the political discourse surrounding the canal.
BlackRock, one of the world’s largest asset management firms, will lead the group acquiring the ports, which also includes Swiss-based Terminal Investment Limited. The deal signals a significant shift in the ownership of key infrastructure but has been presented as a straightforward business transaction by the companies involved.
