Panama Pushes Back: Canal Neutrality Asserted Amid US-China Tensions

Panama has firmly denied claims that its iconic canal is falling under Chinese influence, labeling the idea a “total misperception.” Speaking at the Antalya Diplomacy Forum in Turkey, Panama’s Vice-Minister of Foreign Affairs Carlos Guevara Mann emphasized the canal’s strict neutrality and independence from foreign powers, amid mounting US-China geopolitical friction.
Responding to rising concern in Washington, Mann said his country must do “a very, very good job” in assuring the new US administration that there is no foreign interference in the Panama Canal’s operations. “No foreign country has any impact or influence over the canal’s administration,” Mann stated, noting that it operates under a constitutionally protected neutrality regime since 1999.
The remarks come as Panama navigates increased scrutiny following its decision to withdraw from China’s Belt and Road Initiative earlier this year. According to Mann, the exit wasn’t entirely due to US pressure, but because Panama had received “nothing” in return since joining the initiative in 2017.
Mann addressed concerns sparked by Hong Kong tycoon Li Ka-shing’s CK Hutchison Holdings, which plans to sell its port operations at both ends of the canal in a US$23 billion deal involving US-based BlackRock. The transaction has triggered backlash from both Beijing and Washington. While Beijing views the asset sale as a security threat, US President Donald Trump has previously accused China of controlling the canal.
In defense, Panama Ports Company, a CK Hutchison subsidiary, broke its silence last week, denying financial mismanagement and defending the legitimacy of its contracts, in place since 1997.
Despite the geopolitical tug-of-war, Mann reiterated that Panama remains the sole owner of the canal and that its neutrality is crucial for global trade. He also noted growing US interest in security cooperation, following a new pact that brought US soldiers to Panama—a move some local leaders criticized as a veiled intervention.
China, meanwhile, continues to hold significant commercial stakes in Panama, including a $1.4 billion bridge project and the $900 million acquisition of the Margarita Island port by Landbridge Group. While Panama distances itself diplomatically, Chinese investments in infrastructure and energy persist.
Experts suggest Panama is attempting a diplomatic balancing act. While reassuring the US of its strategic loyalty, it remains open to continued economic engagement with China.