China’s rearguard action to undo efforts to undo its control of ports near the Panama Canal has been foiled by Panama’s Supreme Court.
The Wall Street Journal reports on the court’s decision that “license terms granted to CK Hutchison breach constitution, dealing a blow to China’s influence in region.” And handing a victory to the U.S. and President Trump (January 29, 2026).
The Supreme Court of Panama ruled that terms granted to a Hong Kong company to operate two ports at either end of the Panama Canal breach the country’s constitution, handing President Trump a victory for his security ambitions in the Western Hemisphere and denting China’s influence in the region.
Panama’s high court said in a brief statement that license terms granted to CK Hutchison to run the ports of Balboa on the Pacific Coast and Cristóbal on the Atlantic side were unconstitutional, setting the stage for the company’s departure from the port facilities….
The ruling comes a year after Trump set his sights on Panama. He said Chinese infrastructure that has been built up around the canal in the past three decades was a security threat to the U.S.
“China is operating the Panama Canal, and we didn’t give it to China,” Trump said in his inaugural address early last year.
The high-court decision is a diplomatic defeat for China that comes weeks after the U.S. military’s capture in Caracas of Venezuelan strongman Nicolás Maduro, who was a crucial ally in China’s efforts to secure a strategic foothold in Latin America.
The ruling effectively annuls Hutchison’s contracts with Panama to run the ports. The government of Panama had already pulled out of China’s Belt and Road Initiative.
After Trump demanded an end to Chinese involvement in the region in January 2025, the Hong Kong company CK Hutchison agreed to sell “shares of its units that operate” 43 ports, including the two ports near the Panama Canal, to a group of buyers led by BlackRock.
The sale might have ended whatever direct or indirect control the CCP exerts over those ports. But soon after Hutchison and Blackrock agreed in principle to the transaction, the Chinese government started bellowing, calling the arrangement “despicable” and raising legal concerns.
And now it seems that whether Hutchison and BlackRock manage to consummate their deal is almost beside the point, at least with respect to the ports near the Panama Canal—unless China’s threat to take action in response to the ruling involves more than hot air. Foreign Ministry spokesman Guo Jiakun says: “The Chinese side will take all necessary measures to resolutely safeguard the legitimate rights and interests of Chinese companies.”
The Panama Ports Company, a subsidiary of CK Hutchison, also objects to the ruling.
A former U.S. ambassador to Panama, John Feely, says that the PRC’s setback in Panama is only diplomatic, not also economic, since China’s shippers will still be able to use the canal. We’ll take that half a loaf.
