Sale of Panama Port Stalled Due to Chinese Opposition... U.S.-China Clash Anticipated

Chinese Government "Investigation for National Security and Antitrust Law Violations, to be Handled According to Laws and Regulations"

Chinese Media "CK Hutchison Overly Bowed to Trump"

The Chinese government is strongly opposing the attempt by Hong Kong's CK Hutchison to sell the Panama port it owns to BlackRock, the largest asset management firm in the U.S., making the deal uncertain. U.S. President Trump, who has advocated for reclaiming the Panama Canal from China, has been actively supporting BlackRock's acquisition of the port. Another U.S.-China conflict is anticipated if the deal falls through.

According to Bloomberg, citing sources on the 26th (local time), the sale of two Panama ports by CK Hutchison, led by Hong Kong's richest man Li Ka-shing, is not proceeding due to strong opposition from China. The deal terms are in the final stages, aiming for a signing on April 2, but the Chinese government and Hong Kong authorities are issuing strong warnings citing 'illegality'.

Previously, CK Hutchison announced that negotiations regarding the Panama port and a broader deal involving 41 other CK Hutchison ports were all underway. Upon completion of the sale, the company would earn $19 billion in cash. Hutchison's stock closed up 0.6% in Hong Kong that day.

According to documents submitted to the stock exchange, negotiations between CK Hutchison and the consortium are conducted exclusively for 145 days. This means there is no room for potential bidders like Chinese state-owned enterprises to participate in the negotiations.

As the U.S. declared this deal as reclaiming the Panama Canal from Chinese influence, China expressed anger. According to Bloomberg, earlier this month, Chinese senior leaders instructed an investigation into the CK Hutchison-BlackRock deal for potential violations of national security and antitrust laws.

The state-run newspaper Ta Kung Pao urged CK Hutchison to cancel the deal, stating it risks violating Hong Kong laws concerning the protection of national sovereignty, security, and development interests. In a previous article, Ta Kung Pao criticized CK Hutchison, saying the deal "bowed to Trump to the extent that the spine is not visible." Hong Kong leader John Lee also mentioned that the deal would be handled according to laws and regulations.

Guest reporter Jung-A Kim kja@hankyung.com