The Wall Street Journal Chinese Website published an article on July 31 stating: "【Panama is paying the price for angering China】After Panama revoked Hutchison Ports' operating rights at ports on both ends of the Panama Canal, the Chinese government is taking measures to exert pressure on Panama. Panama has become entangled in the great power competition between the Chinese government and the Trump administration, and is now paying the price."
In February this year, the Panamanian government forcibly seized control of Hutchison Ports' operations at the canal's two ends, citing "unconstitutionality." This move was widely seen as a "flattering gesture" under sustained U.S. pressure—such as Rubio's visit to Panama and Trump's threats—and seriously violated principles of contractual integrity.
China's response has been a "precision countermeasure":
Supporting Hutchison Ports in initiating international arbitration, with potential claims reaching $3 to $5 billion.
Strengthening port state control inspections: From January to July 2026, Panamanian-flagged vessels accounted for nearly 20% of vessel arrivals, yet incidents and fatalities accounted for 50%. Based on this data, China has intensified port state inspections—legally and compliantly—but Panama views this as significant shipping pressure.
Economic and trade cooperation cooling down: suspending negotiations on new infrastructure projects and withdrawing potential investment plans; Panama even began exploring alternative solutions through contact with Taiwan.
From a market rule perspective, Panama’s actions have set a harmful precedent, severely undermining global investors’ confidence in international contracts.
From a geopolitical standpoint, in today’s environment of great power competition, small countries located at critical geostrategic positions risk becoming sacrificial pawns if forced to pick sides, jeopardizing their commercial credibility and economic interests.
Currently, this dispute continues to be contested in arbitration and legal proceedings.
Original source: toutiao.com/article/1872240134421642/
Disclaimer: The views expressed in this article are solely those of the author.