Panama's Port Sale Isn't the End for Trump's Canal Complaints
Panama's Port Sale Isn't the End for Trump's Canal Complaints
AS/COA's Eric Farnsworth talks to Barron's about the U.S. government's demands for concessions from Panama's government.
The sale this week of two Panamanian ports from a Chinese company to a U.S. consortium is a victory for President Donald Trump, but it only appears to have whet his appetite for more concessions from Panama’s government. Investment manager BlackRock BLK -2.14% announced Tuesday it and two partners would buy the ports as part of a $22.8 billion deal with Hong Kong-based CK Hutchison for dozens of ports around the world.
The Trump administration is concerned about Chinese investment in strategic infrastructure globally, particularly in Latin America. The port deal addresses those concerns and removes a point of contention with Panama—the potential for a Chinese security threat in the Panama Canal.
“I think it’s a plus for [Trump],” said Eric Farnsworth, who leads the Washington office for the Council of Americas, a think tank focused on the region. Trump’s interest in the canal “is leading to people questioning whether they want companies linked to China engaging in such direct activities in their country,” he said. [...]
Secretary of State Marco Rubio visited Panama in February. Afterward, the State Department said on social media that U.S. military ships would no longer pay fees to use the canal. Panama objected to the claim, and Rubio said free passage for U.S. ships was an expectation, not a current policy.
“The truth is nobody knows what the real issue is here,” Farnsworth said. “China? Rates on shipping? U.S. desires to have engineering contracts on the environmental side for canal sustainability? Is it Venezuela and migration? Honestly, it could be all of the above...”
