The Panama Canal: A New Battleground for Global Power?

Recently, White House staff have informed the United States military to formulate plans to increase American influence and presence over the Panama Canal. Discussions about the United States intervening in Panama arose from a post made by President Trump on his social media platform “Truth Social.” Built by the United States in 1914, the Panama Canal is a 51-mile-long (82 km) waterway that connects the Atlantic Ocean to the Pacific Ocean. The canal was officially returned to Panama on December 31st, 1999. The canal has now become a subject of debate, with discussions about whether the United States should maintain the status quo or expand American influence over the canal. President Trump’s recent actions suggest the latter option. There have been talks about whether President Trump is looking for the United States to fully seize control over the canal or increase collaboration with the Panamanian government. 

The Panama Canal

Chinese Influence Over the Panama Canal 

Since 1997, CK Hutchison Holdings (Hong Kong-based) has been operating both the ports of Balboa and Cristóbal. Balboa on the Atlantic Ocean and Cristóbal on the Pacific Ocean are the two biggest ports on the Panama Canal. CK Hutchison’s chairman, Victor Li Tzar-kuoi, has been in power since 2014. In addition to his position at CK Hutchison, Mr. Li is a member of the Chinese People's Political Consultative Conference. The Chinese People's Political Consultative Conference is a political advisory body that serves the purpose of guiding the Chinese government on key issues. Other Chinese-backed initiatives in the region include the construction of a 4th bridge across the canal and the construction of the Amador Cruise Terminal (BBC). Given a potential conflict between the United States and China, American policymakers are concerned about China’s ability to control the canal. It is important to note that there is currently a deal in the works for BlackRock (an American investment company) to purchase the ports of Balboa and Cristóbal from CK Hutchison Holdings for 23 billion USD. Now, it is currently unclear if this deal will go through. Whether an overreaction or not, Chinese influence over the Panama Canal is a national security concern for many Americans, specifically the Trump Administration.  

How Will This Situation Play Out? 

There has been a lot of vagueness in President Trump’s comments about how he will handle the geopolitical situation of the Panama Canal. During Secretary of State Marco Rubio’s visit to Panama, he told the Panamanian President that the “status quo was unacceptable” (NBC). If the deal between BlackRock and CK Hutchison falls apart, it becomes much more likely that the United States will exercise military force to seize the canal. It is also possible that President Trump’s threats to take the Panama Canal back by force are a bluff to put pressure on China and Hong Kong officials to back off from trying to disrupt the deal between BlackRock and CK Hutchison.  

The Panama Canal is shaping up to be one of the most interesting geopolitical conflicts of the 21st century. At the moment, only time will tell how the United States plans will counter Chinese influence over the Panama Canal.