United States alleges China exerts undue control over Panama Canal operations
In a complex and closely-watched deal, the sale of Hutchison Port Holdings (HPH) and Hutchison Port Group Holdings, involving 43 global ports including two near the Panama Canal, is unlikely to be completed in 2025 and is expected to close no earlier than 2026.
The deal, valued at around $22.8-$23 billion, requires approval from multiple authorities including those in China, the U.S., Britain, and the EU. A significant development in the deal is the inclusion of a major Chinese strategic investor in the buying consortium, led by BlackRock Inc. and MSC (Mediterranean Shipping Company).
Dorothy Shea, the US interim representative, has highlighted China's interests and influence over the Panama Canal, particularly in "critical infrastructure and port operations." This move has added a geopolitical dimension to the deal, with tensions between the U.S. and China affecting its progress.
The consortium's initial plan would have given them control of 43 ports in 23 countries, including the ports of Balboa and Cristóbal, located at each end of the Panama Canal. However, under US pressure, CK Hutchison, the Hong Kong-based company that currently operates ports at both ends of the Panama Canal since 1997, announced it would sell all its shares to a consortium that includes BlackRock Global Infrastructure Partners' subsidiary and Mediterranean Shipping Company's Terminal Investment Limited.
China, which considers it crucial to "maintain neutrality" of the Panama Canal, has expressed concerns over the sale. Panamanian President José Raúl Mulino emphasized the neutrality of the Panama Canal and its guarantee by a multilateral treaty. China's UN ambassador, Fu Cong, affirmed China's recognition of Panama's sovereignty over the canal and the neutrality of the waterway.
CK Hutchison is maintaining discussions with consortium members to invite a significant strategic investor from the People's Republic of China. The composition of the consortium and the structure of the transaction need to be changed to ensure approval from all relevant authorities.
As of August 2025, while the deal is still in flux, the involvement of Chinese investors has improved the prospects for regulatory approval, but final completion remains delayed and uncertain.
[1] ABC News: "Hutchison Port Sale in Doubt as Chinese Investor Talks Continue" [2] Reuters: "Hutchison Port Sale Remains Uncertain as Regulatory Hurdles Persist" [3] Financial Times: "Geopolitical Tensions Affect Hutchison Port Sale" [4] Wall Street Journal: "CK Hutchison Seeks Chinese Investor for Port Sale Consortium" [5] BBC News: "Panama Canal Neutrality at Stake in Hutchison Port Sale"
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