Hong Kong’s government has pushed back strongly against a decision by Panama’s highest court to strike down a concession that allowed CK Hutchison to operate ports at both ends of the Panama Canal, warning the move could undermine international business confidence.
In a statement issued Friday, the government said it “strongly disapproves of and firmly rejects” the ruling, arguing that it unfairly harms the legitimate interests of Hong Kong companies. It also criticized what it described as the use of coercive or unreasonable measures by foreign governments in economic and trade relations.
Court Ruling Raises Geopolitical Stakes
Panama’s Supreme Court ruled late Thursday that the concession held by a CK Hutchison subsidiary was unconstitutional. The decision followed an audit by Panama’s comptroller, which alleged irregularities in a 25-year extension of the concession approved in 2021.
The ruling aligns with long-standing US concerns about China’s potential influence over the strategically vital waterway. Blocking such influence has been a priority for Washington, particularly under President Donald Trump, who once suggested Panama should return control of the canal to the United States.
Panama was also the first overseas destination for US Secretary of State Marco Rubio, who made clear that Washington views the operation of the ports as a national security issue, despite repeated assurances from Panama’s government and canal authority that China has no role in canal operations.
The court offered no indication of what will happen next to the ports.
Company Rejects Decision, Weighs Legal Options
Panama Ports Company, the CK Hutchison subsidiary that operates the ports, said it had not yet been formally notified of the ruling. The company defended its concession as the product of a transparent international bidding process and said the court’s decision lacks legal basis.
In a statement, the company warned that the ruling threatens not only its contract but also the livelihoods of thousands of Panamanian families who depend directly or indirectly on port activity. It added that the decision could weaken the rule of law and legal certainty in the country.
The firm said it is reserving all rights to pursue legal action in Panama or elsewhere, without providing further details.
A Deal That Complicated Matters With Beijing
The dispute has also revived scrutiny of a stalled deal announced last year, in which CK Hutchison agreed to sell its majority stake in the Panamanian ports and other global assets to an international consortium that included BlackRock.
That transaction appeared to slow amid objections from the Chinese government. In July, the company said it was considering bringing in a Chinese investor as a major partner, a move widely seen as an attempt to ease tensions with Beijing. No further updates have been announced since.
The episode underscores the increasingly delicate position Hong Kong’s business leaders face as they try to balance global commercial interests with political expectations from Beijing, particularly at a time of strained relations between China and the United States.
