Tensions Escalate Between Panama, CK Hutchison Over Canal Ports

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Written by Amir Richani for IIR News Intelligence (Sugar Land, Texas)

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Summary

Panama's president rejected as "false and "outrageous" claims by Panama Ports Company, CK Hutchison's local unit, following the cancellation of concessions for the Cristobal and Balboa ports.

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President Spars with PPC Executives

The dispute between CK Hutchison and the government of Panama has escalated over the past few weeks. On March 19, Panama's President Raul Mulino told journalists that the Asian company's earlier statements were "outrageous" and "lies."

On March 16, Panama Ports Company (PPC), a local unit of CK Hutchison, released a statement saying that the government of Panama missed the deadline to respond to the arbitration case under the International Chamber of Commerce Court. The case began after Panama terminated PPC's contract for the ports of Balboa and Cristobal, which it had operated since 1997.

Subscribers to Industrial Info's Global Market Intelligence (GMI) Industrial Manufacturing Plant and Project databases can learn more about these ports--including capacities, investment values and necessary equipment--from detailed profiles of Balboa and Cristobal.

The ports are located in the Panama Canal, an artificial waterway connecting Atlantic and Pacific shipping routes. The Panama Canal recorded 13,404 transits in its fiscal-year 2025, accounting for about 3% of the world's maritime global trade volume.

PPC also stated that Panama was disregarding the rule of law after what it described as the occupation, search and seizure of the facilities and property of PPC.

"These are all signs of a State that disregards foreign investment by violating contracts, laws, and international norms. For PPC and its investors, Panama has caused drastic and mounting damages, and they permanently reserve all rights and recourse," concluded PPC in its statement.

After PPC's March 16 statement, the government responded with strong criticism. Mulino emphasized that international lawyers had been appointed to defend Panama throughout the arbitration, and he repeated that the company's claims were false.

Meanwhile, the Panama Maritime Authority (PMA), which acts on behalf of the government, said in a statement that the differences between PPC and the state will be resolved at the arbitration tribunal and that it will present its argument in due course. It also reserved "the right to refrain from further public comment on PPC's statements until the arbitration has concluded."

PMA also mentioned that after taking over the Balboa and Cristobal from PPC, it found the terminals were deteriorated and below international best practices and standards.

Court Decision and Background

In January, Panama's Supreme Court declared PPC's concession unconstitutional. This decision ended the company's contract, and PPC subsequently launched arbitration proceedings.

The decision came amid heightened U.S.-China tensions in Panama, with President Donald Trump suggesting that the Panama Canal was controlled by Chinese companies, while Washington D.C. sought to displace Chinese and Russian influence in South and Central America.

Chinese authorities also have criticized Panama's decision.

Key Takeaways

• Panama's President considers accusations against his country "outrageous."
• PPC says Panama missed deadline in the arbitration process.
• The cancellation of the contract coincides with the broader China-US tensions.

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About IIR News Intelligence
IIR News Intelligence is a trusted source of news for the industrial process and energy markets, powered by Industrial Info Resources' Global Market Intelligence (GMI).

About Industrial Info Resources
Industrial Info Resources (IIR News Intelligence) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 250,000 current and future projects worth $30.2 trillion (USD).