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Igor Patrick

Kahon Chan

Panama’s audit of a Hong Kong company, which operates ports at both ends of the country’s canal, aims to provide a robust framework to counter US President Donald Trump’s claims that China controls the waterway, the Post has learned.
“The [Panama government] needs concrete data to counter this ‘China is controlling the canal’ narrative,” a source said on Tuesday.
The insider added that auditing Hutchison Port Holdings would also allow the administration to review a concession signed by Panama’s former president, Laurentino Cortizo.
According to a Panamanian newspaper, the review will also scrutinise a 2021 renewal of Hutchison’s 25-year concession contract, which has been criticised for lacking transparency and producing limited economic benefits for Panama.
The audit was launched amid heightened international tensions following Trump’s inauguration, during which he declared his intention to regain control of the Panama Canal. Trump repeatedly argued that Panama’s agreement enabled China to profit, framing it as a threat to the security and commercial interests of the United States.
“We gave it to Panama, not China, and we’re taking it back,” Trump said in his inauguration speech while alleging treaty violations to justify such actions.
Hutchison manages more than 50 key port terminals around the world. The contract renewal allowed the company to continue controlling the ports of Balboa and Cristobal, located at the Pacific and Atlantic entrances to the canal.

Reacting to Trump’s remarks, Panamanian President Jose Raul Mulino reaffirmed the canal’s sovereignty. “The canal is and will remain Panamanian,” he posted on social media minutes after Trump was sworn in.
He also dismissed claims of foreign interference, asserting that Panama’s administration operated independently and to the benefit of global commerce.
Mao Ning, spokeswoman for China’s foreign ministry, said on Wednesday that the country did not play a role in the canal’s management and operations, and never interfered in affairs related to the waterway.
“We agree with what Panama’s president said, that the sovereignty and independence of Panama are not negotiable, and the Panama Canal is not under direct or indirect control by any power,” she added.
“We always respect Panama’s sovereignty over the canal and recognise the canal as a permanently neutral international waterway.”
Mulino’s administration has also filed a formal complaint with the UN Security Council, accusing Trump of “undermining Panama’s territorial integrity”.
Earlier this month, Panamanian Comptroller General Anel Flores said: “We have to investigate because the losers are all of us”. He also stressed his commitment to uncovering concession irregularities.
Critics pointed to a “lack of transparency” in the deal’s renewal, noting that some of the government’s reports on the subject at the time were not made public.
Flores described the concession’s terms as economically disadvantageous for Panama, comparing them with a “colonial enclave” perpetuating inequality despite the significant growth in container traffic through the canal.
Panamanian officials now want to check whether Hutchison has adhered to the terms of its renewed concession, including commitments on dividends and container-movement fees.
Under the 2021 agreement, the company was required to pay US$7 million annually in dividends. At the time, the government said tariff adjustments were set to boost state revenue to an estimated US$800 million over the next 25 years.
But the same source told the Post that this figure fell short of Panama’s potential earnings, given the low fees per container, compared with other ports around the world.
Flores pledged that the review, which will include an examination of past and projected revenues from the concession, would be thorough.
Initial steps included site visits and meeting officials from Hutchison and Panama’s Maritime Authority.
The comptroller general published a video of a visit to the Panama Ports Company headquarters in a post on social media, emphasising that the auditors wanted to “ensure the efficient use of public resources” in the canal.
The audit is expected to take several months, with preliminary findings anticipated later this year.
International relations expert Wilson Chan Wai-shun said Panama was “putting it two ways” by carrying out the audit, although it would be unclear whether it was being done for real or for show until the conclusions were out.
“Panama needs to take action to show that it conducts due diligence on everything by conducting an audit, so that people cannot accuse it of completely letting Beijing control those two places [at Balboa and Cristobal],” he said.
It was possible Panamanian authorities might update concession terms at the end of the review to collect a higher share of revenues from Hutchison Ports, although they could also use the opportunity to prove the operator was independent from state actor influence, he said.
The scholar said Hong Kong businesses’ involvement in foreign countries had long been subject to scrutiny tied to security, but the likelihood of them being welcomed could vary depending on the specific circumstances and different industries.
“Port facilities have long been a very important part of economic and international security, so that will attract a lot of eyeballs. Meanwhile, Spain has also introduced a lot of Chinese investment to develop electric vehicles, so they are not having problems with that.”
The Panamanian arm of Hutchison Ports said it was “fully cooperating and maintaining due transparency” with the local authorities in the audit.
It added it was committed to complying with local laws and regulations, and had maintained transparency by sharing its audited financial results with the Panamanian state annually.
“It is noteworthy that we were audited in 2020 - 2021 by the General Comptroller’s Office of the Republic and the Panama Maritime Authority, both of which demonstrated full compliance with our contractual obligations,” the firm said.


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‘The [Panama government] needs concrete data to counter this China is controlling the canal narrative,’ insider says


‘The [Panama government] needs concrete data to counter this China is controlling the canal narrative,’ insider says.


Panama audit of Hong Kong’s Hutchison aims to counter US canal narrative

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}‘The [Panama government] needs concrete data to counter this China is controlling the canal narrative,’ insider says

‘The [Panama government] needs concrete data to counter this China is controlling the canal narrative,’ insider says