In Hong Kong, a significant controversy has unfolded around a major conglomerate’s decision to divest its Panama Canal port assets to a consortium that includes the American investment giant BlackRock Inc. This transaction has stirred opposition from Beijing, emphasizing the increasing tensions between China and the United States, which are putting Hong Kong’s business leaders in a difficult spot.
The Chief Executive of Hong Kong, John Lee, addressed the situation during a weekly press briefing, mentioning that CK Hutchison Holdings’ agreement to sell its stakes in the port operations at both ends of the Panama Canal is undergoing considerable scrutiny. He indicated that the concerns being raised about this transaction warrant serious consideration without specifying the exact nature of those concerns.
Lee emphasized the importance for foreign governments to create an equitable environment for businesses, opposing any coercive or domineering tactics in international trade. He refrained from directly referencing U.S. President Donald Trump or criticizing CK Hutchison or the family of the conglomerate’s owner, Li Ka-shing.
The Hong Kong leader’s remarks were made amid an implicit backlash from Beijing. Since last Thursday, Chinese offices responsible for Hong Kong affairs have been sharing commentaries by a Beijing-backed local newspaper, which criticized the deal and questioned its implications.
The commentary deemed the sale as a betrayal of Chinese interests and suggested that business leaders engaging with American politicians for swift gains might face long-term reputational damage. Such posts have been interpreted as an indirect criticism of CK Hutchison by Chinese authorities.
Conversely, Trump welcomed the deal by asserting that his administration would reclaim oversight of the Panama Canal, a claim disputed by Panama’s President José Raúl Mulino. Lee assured that any transaction within Hong Kong’s jurisdiction must adhere to its laws and that the authorities would handle it accordingly, without further specification.
As Beijing’s influence grows over the city, business leaders in Hong Kong, which returned to Chinese rule from Britain in 1997, are experiencing mounting pressure. CK Hutchison declined to comment on Lee’s statements or the critical newspaper entries and has opted not to hold a news conference for its upcoming financial results.
In Beijing, when questioned about potential investigations into the sale, a spokesperson from China’s Foreign Ministry redirected inquiries to other authorities, emphasizing China’s opposition to any actions undermining legitimate international rights through economic pressure or bullying.
CK Hutchison surprised the market on March 4 by announcing its intention to sell stakes in Hutchison Port Holdings and Hutchison Port Group Holdings, a transaction evaluated at nearly $23 billion, including $5 billion in debt. The company insisted that the sale was purely a commercial decision, unrelated to other activities surrounding the Panama Ports.
Should it proceed, the BlackRock consortium will gain control over 43 ports across 23 nations, including the strategically significant ports of Balboa and Cristobal located at each end of the Panama Canal. Approvals for the deal rest with Panama’s government, and it doesn’t affect other ports managed by a trust in Hong Kong or mainland China.
Panama maintains sovereignty over the operation of its ports and insists that no U.S. “reclaiming” is involved in selling assets to an American company. The U.S. originally constructed the canal for efficient transit between its coastlines and turned over control to Panama by the end of 1999, as per a treaty signed by President Jimmy Carter in 1977, a move Trump has criticized. Notably, 70% of sea traffic traversing the canal is headed to or from U.S. ports.
