BlackRock has secured a $23 billion deal to acquire substantial port operations alongside the Panama Canal, raising concerns over Chinese control in the region. The acquisition includes 90 percent of Panama Ports Company and significant interests in Hutchison Ports. This move aims to enhance US corporate ownership of these strategic assets, amidst ongoing geopolitical tensions.
BlackRock has recently finalized a significant $23 billion agreement to acquire major port operations on both sides of the Panama Canal amid rising tensions between the United States and China. The consortium’s agreement, as disclosed in an official statement on Tuesday, will involve the purchase of units that represent 80 percent of the Hutchison Ports group, which operates 43 ports across 23 countries. Additionally, the consortium will take 90 percent control of Panama Ports Company, the operator of Balboa and Cristobal ports. CK Hutchison, the current owner, is expected to receive cash proceeds amounting to $19 billion.
This transaction has important implications as it consolidates major port operations under the ownership of US-based corporations. A source familiar with the matter indicated that BlackRock has briefed US Congress and the Trump administration regarding the deal. The US government has flagged foreign ownership of ports near the Panama Canal as a potential security threat, particularly concerning Chinese influence in the region.
In his recent remarks, former President Trump expressed concerns over the operational control of the Panama Canal, suggesting it is effectively managed by Chinese interests despite the 1977 treaty that granted control to Panama. He emphasized his desire for the US to regain control over the canal, claiming that the strategic waterway has been compromised under Chinese management.
Opposition to foreign ownership, particularly relating to Chinese interests, is based on the fear that such control could facilitate military operations or monitoring of maritime traffic. However, officials from Panama and former US military personnel have stated that there has been no military threat posed by China, nor any violations of the canal’s neutrality.
This deal comes with historical significance, as the Panama Canal was built by the United States and was later handed over to Panama in 1999 under a treaty negotiated by former President Jimmy Carter. CK Hutchison, which has operated the ports under a concession since 1997, asserts that the sale was conducted through a competitive process involving multiple bids and expressions of interest.
In conclusion, BlackRock’s acquisition of key port operations near the Panama Canal underscores the ongoing geopolitical tensions between the US and China. The deal aims to bolster US interests in a strategically crucial area, as concerns persist regarding foreign ownership potentially compromising national security. President Trump’s remarks reinforce the administration’s adversarial stance towards Chinese involvement in crucial maritime infrastructure.
Original Source: m.economictimes.com
