China Vows ‘Necessary Action’ Following Panama Port Decision

China has announced it will take “necessary measures” in response to a recent ruling by Panama’s Supreme Court. This decision declared the Chinese control of ports near the Panama Canal unconstitutional. The ruling, issued late Thursday, specifically annulled the concession held by CK Hutchison Holdings, a company based in Hong Kong.

Overview of the Ruling

The Supreme Court’s decision came after an audit by Panama’s comptroller revealed concerns regarding the extension of the concession that had been granted in 2021. The original contract allowed CK Hutchison to operate ports at both ends of the canal for a 25-year term.

Chinese Response

According to Guo Jiakun, a spokesman for China’s Foreign Ministry, the government will firmly protect the legitimate rights and interests of Chinese enterprises involved. However, he did not specify the exact steps Beijing may take next.

Impact on Panama Ports Company

• The Panama Ports Company (PPC), a subsidiary of CK Hutchison, criticized the ruling.
• PPC stated that their concession was obtained through a transparent international bidding process.
• The company warned that the annulment undermines not only its contract but also the economic stability of many Panamanian families.

Since the 1990s, PPC has operated terminals at both the Pacific and Atlantic entrances of the Panama Canal, handling container traffic separate from the canal’s operational activities.

Geopolitical Context

This ruling may be welcomed by the Trump administration, which has prioritized limiting China’s influence in the region. During a visit in early 2025, U.S. Secretary of State Marco Rubio emphasized the importance of addressing China’s presence around the Panama Canal.

Former President Trump had previously called for the U.S. to regain control over the canal, marking it as a national security issue. However, Panama consistently maintains that the sovereignty of the canal is non-negotiable and will remain under its management.

This situation underscores the increasing tensions in U.S.-China relations, particularly concerning critical global infrastructures like the Panama Canal.