1 week Ago By Charles Kennedy
U.S. Secretary of Defense Pete Hegseth said Washington would “take back” the Panama Canal from “China’s influence” during a visit to Panama, saying the Trump administration would not allow China to “weaponize” the passage.
“Together, we will take back the Panama Canal from China's influence,” Hegseth said. “China did not build this canal. China does not operate this canal and China will not weaponize this canal.
Together with Panama in the lead, we will keep the canal secure and available for all nations,” the defense secretary also said. Reuters said in a report on the news that the Panama Canal handles some 40% of U.S.
container traffic, which is worth some $270 billion annually. After President Trump won the November elections, he threatened to take the Panama Canal back from Panama, saying the U.S.
was being “ripped off”. Speaking at an event in December last year, Trump said, “Has anyone ever heard of the Panama Canal? Because we're being ripped off at the Panama Canal like we're being ripped off everywhere else.” The canal was built by the United States in the early 20th century.
Panama granted the U.S. the right to build and operate the canal in exchange for annual payments.
Ownership over the infrastructure was passed to the Panamanian government in 1977 by President Jimmy Carter. The deal granted control over the Panama canal to the local government under obligation of maintaining its neutrality. Two key ports at the Canal, however, are owned by a Hong Kong conglomerate with ties to Beijing.
In March, media that BlackRock had led a consortium to buy the two ports from CK Hutchinson—the Hong Kong owner—for $19 billion. Chinese regulators, however, put the deal on hold. In the latest development in the saga, the Panamanian comptroller irregularities with the contract that CK Hutchinson has with the local authorities for the management of the ports.
The irregularities were discovered during an audit ahead of the renewal of the company’s license to operate the ports. By Charles Kennedy for Oilprice.com.
