Panama Strips Chinese Company of Canal Ports, Hands Control to Maersk and MSC

Panama's Supreme Court has officially terminated port contracts with a Hong Kong-based company, allowing two major shipping firms to take temporary control of critical Panama Canal terminals. The move comes amid rising U.S.-China tensions over global trade routes and follows President Trump's push to reduce Chinese influence over the canal.

PANAMA CITY – Panama officially ended more than two decades of port operations by a Hong Kong-based company on Monday, transferring temporary control of two vital Panama Canal terminals to major international shipping firms.

The country’s Supreme Court ruling, now published in Panama’s official record, officially terminated the port agreements held by Panama Ports Company, a division of Hong Kong’s CK Hutchison. The decision clears the path for new operators to manage the Balboa and Cristobal terminals.

Panama’s Maritime Authority has assumed control of both facilities through government decree to maintain continuous operations, according to Alberto Aleman Zubieta, who leads the technical committee managing the transition process.

The government announced Monday afternoon that it has authorized two interim operating agreements with the Maritime Authority, each running up to 18 months. APM Terminals Panama, owned by Maersk, will manage the Balboa facility, while TIL Panama, connected to Mediterranean Shipping Company, will oversee Cristobal operations.

President Jose Raul Mulino described the interim agreements as “a legitimate tool that respects asset ownership.”

“Let me be clear, this does not imply an expropriation of those assets, but rather their use to ensure the operation of the ports until their real value is determined for the corresponding actions. I repeat, this is not an expropriation,” Mulino stated during a Monday afternoon television broadcast.

Earlier this month, Mulino had indicated the government would proceed with formalizing arrangements with APM Terminals Panama to oversee the ports once the court decision became legally enforceable.

Mulino explained the temporary setup will continue while Panama creates a new “competitive” bidding process for future port management, “with the humility not to repeat the mistakes of the past.”

The president assured that neither port functions nor jobs would be disrupted during the transition period.

Maersk has not yet provided a response regarding the development.

“The moment the official gazette publishes the court’s ruling, Panama Ports loses control of the ports,” political observer Jose Stoute had predicted before the official publication.

The January court decision emerges during intensifying competition between the United States and China over international shipping lanes and represents a victory for Washington’s interests.

President Donald Trump has actively worked to limit Chinese control over the Panama Canal, a waterway that handles approximately 5% of worldwide maritime commerce.