Panama Court cancels Chinese port contract, another win for Trump Administration

The Trump administration has scored another win in its rivalry with China. Panama’s Supreme Court has declared unconstitutional the contract that allowed a subsidiary of Hong Kong–based CK Hutchison Holdings to operate two major port terminals along the Panama Canal, effectively canceling the concession extension approved in 2021.

The legal action followed pressure from the Trump administration, which has sought to curb China’s influence around the strategically vital waterway. These concerns were later echoed by Panama’s government after an audit identified financial and operational issues in the port operations. Supporters of the ruling are framing the decision as a geopolitical victory for the United States, in line with Trump’s broader strategy, often referred to as the “Donroe Doctrine,” aimed at reinforcing U.S. influence in the Western Hemisphere and limiting China’s role in critical infrastructure.

In addition, last year CK Hutchison Holdings said it would sell the majority of its port assets in Panama and other countries to a global consortium that includes BlackRock Inc. and the Italian shipping group MSC. However, the Chinese government opposed the deal, keeping the dispute alive and underscoring the ongoing geopolitical tug-of-war.

Against this backdrop, it appears increasingly likely that the Panama Canal issue will feature prominently on the agenda of any future bilateral negotiations between the United States and China.

Benedetta Zimone