China and US clash over Panama port dispute

The U.S. State Department has escalated diplomatic tensions with China over a port dispute in Panama, accusing Beijing of violating Panamanian sovereignty and attempting to politicize maritime trade in the strategically important Central American nation.

The controversy began earlier this year when Panama seized control of two critical ports on the Panama Canal from a subsidiary of a Hong Kong-based company. In response, China allegedly detained or delayed dozens of Panama-flagged ships, though these delays were reportedly brief.

On Tuesday, the State Department issued a joint statement with several smaller regional allies — Bolivia, Costa Rica, Guyana, Paraguay, and Trinidad and Tobago — condemning China’s actions as a “blatant attempt to politicize maritime trade” and expressing solidarity with Panama.

U.S. Secretary of State Marco Rubio reinforced this position with a social media post declaring, “The sovereignty of our hemisphere is non-negotiable.” His comments follow accusations made in early April that China was “bullying” Panama through its actions against Panamanian vessels.

China swiftly rejected these allegations. Lin Jian, spokesperson for China’s Foreign Ministry, called the U.S. statements “completely unfounded and distort reality” during a news conference on Wednesday. Jian countered by highlighting America’s historical involvement in Panama, asking pointedly: “Who occupied the Panama Canal for a long time, invaded Panama with its military, and arbitrarily trampled on its sovereignty and dignity?”

The Chinese spokesperson further accused the United States of being the party that “has politicized and securitized the issue of ports” in the region.

Caught between the two global powers, Panamanian President José Raúl Mulino issued a measured statement acknowledging the “solidarity of friendly countries” regarding the detained vessels while attempting to defuse tensions. “We do not wish to engage in controversy, as we value respectful relations with all nations,” Mulino stated.

The diplomatic row underscores Panama’s delicate position in the growing geopolitical rivalry between the United States and China. The Panama Canal remains one of the world’s most critical maritime chokepoints, with approximately 6% of global trade passing through it annually. Control and influence over the canal and surrounding infrastructure represent significant strategic interests for both Washington and Beijing.

This latest dispute occurs against a backdrop of increasing U.S. assertiveness in Latin America under the current administration. President Donald Trump has taken notably aggressive stances on several regional issues, including the overnight raid that captured Venezuela’s president, imposing an oil blockade on Cuba, and threatening military action against Mexican cartels.

For its part, China has been steadily expanding its economic presence throughout Latin America over the past decade through infrastructure investments, trade agreements, and diplomatic overtures. Panama has been particularly receptive to Chinese engagement since 2017, when it severed diplomatic ties with Taiwan in favor of establishing relations with Beijing.

The U.S. has long sought to counterbalance China’s growing influence in what it considers its traditional sphere of influence. Last year, President Trump publicly accused Beijing of effectively controlling operations at the Panama Canal, further stoking tensions over the strategic waterway.

As this diplomatic confrontation unfolds, the implications extend beyond bilateral relations between the involved countries. The dispute highlights the intensifying competition for influence in Latin America and raises questions about how smaller nations like Panama can navigate between competing superpower interests while maintaining their sovereignty and economic development.