China Puts Spoke In The Wheel After US Calls Beijing A Threat To Panama

China has slammed the United States' "bullying nature", after US Defense Secretary Pete Hegseth said Beijing was threatening the Panama Canal's operations. Beijing said US officials had "maliciously attacked" it over the key waterway to further its own interests. China is also reportedly influencing the Trump administration-backed sale of two key Panama Canal ports, operated by Hong Kong-based CK Hutchison, to US investment firm BlackRock.

"Senior US officials have maliciously attacked China, smearing and undermining China-Panama cooperation, once again exposing the United States' bullying nature," foreign ministry spokesman Lin Jian said at a regular press briefing.

This came after the Chinese embassy in Panama, in a statement on X, said the US has used "blackmail" to back its own interests and the "US doesn't have the right to interfere in" who Panama chooses to carry out business with.

"The US has carried out a sensationalistic campaign about the 'theoretical Chinese threat' in an attempt to sabotage Chinese-Panamanian cooperation, which is all just rooted in the United States' own geopolitical interests," the embassy wrote.

Pete Hegseth's Panama Visit

US Secretary of Defense Pete Hegseth, the second senior US official to visit Panama since President Donald Trump took office in January, on Tuesday vowed to "take back" the "US-built" canal to counter what he sees as China's influence over the waterway. Hegseth's visit to Panama comes two months after that of US Secretary of State Marco Rubio.

"Today, the Panama Canal faces ongoing threats...The United States of America will not allow communist China or any other country to threaten the canal's operation or integrity," Hegseth said in a speech Tuesday at a police station located at the entry to the shipping route.

He also met with Panama's President Jose Raul Mulino, with the two issuing a joint statement that affirmed security ties. However, there was a notable discrepancy in the versions released by both sides on the issue of Panama's sovereignty over the canal.

"Secretary Hegseth recognized Panama's leadership and inalienable sovereignty over the Panama Canal and its adjacent areas," read a Spanish-language statement released by Mulino's office.

That sentence did not appear in the English-language statement released by the US government.

However, shortly after that visit, Panama announced it was pulling out of Chinese President Xi Jinping's landmark global infrastructure program, the Belt and Road Initiative.

Panama Canal Issue

Hong Kong company CK Hutchison operates two ports at either end of the canal connecting the Atlantic and Pacific, through which five percent of all global shipping passes.

The Trump administration has put immense pressure on Panama to reduce what it calls Chinese influence on the canal, which Washington sees as a threat to US national security. Panama has, however, denied the assertions that China exercises undue control over the waterway.

But faced with Trump's repeated threats to seize the canal, Panama has put pressure on CK Hutchison to pull out of the country. In January, it began an audit of Panama Ports -- the subsidiary -- to determine if it was honoring its concession contract.

After months of President Trump repeatedly saying that China asserted too much control over the Panama Canal, CK Hutchison, in March, announced an agreement to sell 43 ports in 23 countries -- including its two on the canal -- to a group led by giant US asset manager BlackRock for $19 billion in cash.

The deal was touted as a victory by President Donald Trump and was scheduled to be signed on April 2. But a furious Beijing has since announced an antitrust review of the deal, which likely prevented the parties from signing an agreement last week as had been planned, according to a report by AFP.

It was further delayed after on the eve of Hegseth's visit, Panama's comptroller announced that the audit had revealed "many breaches" of the contract and said Panama did not receive $1.2 billion it was owed from the operator.