Jesús Daniel Romero for Poder & Dinero and FinGurú
In a significant geopolitical and economic event, BlackRock has secured the concessions to operate the strategic ports of Balboa and Cristobal in Panama, regaining control from Hutchison Whampoa, a Hong Kong-based company with strong ties to Beijing. This announcement comes just 30 days after U.S. Secretary of State Marco Rubio visited Panama, underscoring the growing influence of U.S. policy over critical infrastructure in Latin America. This move marks a shift in regional power dynamics, with implications for global trade, competition between the U.S. and China, and Panama's role as a key logistics hub. While this is undoubtedly a victory for U.S. interests, Beijing has achieved a significant triumph: Panama's continued recognition of China over Taiwan.
I arrived in Panama in September 1996 on an assignment from the Defense Intelligence Agency. At that time, the concessions to operate the ports of Balboa and Cristobal had already been awarded to Hutchison Whampoa Ltd. Recognizing the strategic importance of this development, I immediately reported it up the chain of command. However, there was little interest from the U.S. embassy or my agency; the main focus was on the reversion of the Panama Canal and the imminent relocation of U.S. Southern Command from Quarry Heights to Miami. The port concessions were apparently a done deal.
At that time, Panama maintained official diplomatic relations with Taiwan and was a key regional partner. This alliance shaped its foreign policy and economic dynamics, limiting Beijing's influence in the country. However, despite its formal ties with Taiwan, Panama granted the port concessions to Hutchison Whampoa Ltd. This underscored China's long-term strategy: to expand its presence in Latin America long before Panama formally severed its ties with Taiwan in 2017.
Within a few months of Hutchison Whampoa Ltd. securing the port concessions, concerns grew in the U.S. about China's rising influence over Panama's strategic routes. One of the most vocal figures was Admiral Thomas H. Moorer, former Chairman of the Joint Chiefs of Staff, who publicly warned about the risks to national security of allowing a China-linked company to control key access points to the Panama Canal. His warnings resonated in defense and intelligence communities, but Washington remained focused on the canal reversion and the withdrawal of U.S. military forces. Despite these concerns, no substantial action was taken to challenge or curb China's expansion in Panama.
Meanwhile, I remained deeply concerned about China's aggressive push to secure the port concessions. Rumors circulated that Beijing had bribed Panamanian political figures to secure the deal, a claim that, while unproven, was not unlikely given the entrenched corruption culture in Latin America. The question was not whether corruption played a role, but how much. For me, this was never just a trade deal; it was a calculated geopolitical maneuver. Securing these ports was not just about trade and logistics, but about establishing a foothold in Panama to undermine Taiwan, which at that time still maintained diplomatic recognition from the country.
By 1998, the U.S. Congress was holding hearings on the Panama Canal, reflecting rising concern about the strategic implications of Hutchison Whampoa Ltd.'s control of the ports. My phone rang incessantly with calls from congressional aides who had somehow tracked down my number, seeking information and insights. I was also instructed to redirect inquiries to CONUS, a sign that high command was finally paying attention. For the first time, it seemed that Washington was beginning to understand the magnitude of what was at stake. But despite the increased attention, no significant action was taken. The concessions remained in place, and Beijing's influence in Panama only deepened.
China's ambitions were not limited to Panama. Around the same time, Beijing was aggressively seeking control of a key terminal at the Port of Long Beach. In 1997, the China Ocean Shipping Company (COSCO), a Chinese state-owned enterprise, obtained a 40-year lease to operate the former Long Beach Naval Shipyard, turning it into a cargo terminal. This development sparked national security concerns in the U.S. Congress, given COSCO's links to the Chinese government. However, despite these warnings, the lease was approved, marking China's second major maritime victory in a short span.
However, unlike Panama—where Chinese influence remained entrenched—U.S. policy eventually changed course. In 2019, under pressure from the Trump administration, COSCO was forced to sell its lease of the Long Beach Container Terminal to Macquarie Infrastructure and Real Assets, an Australian company, for $1.78 billion. This move demonstrated that while China had established a footing in key maritime infrastructure, its influence was not unbreakable.
Still, Beijing's true strategic victory was never just about gaining physical control of the ports of Balboa and Cristobal. While gaining influence over these logistics hubs was valuable, the real geopolitical prize was Panama's diplomatic recognition of China over Taiwan in 2017. In this regard, Beijing played its hand masterfully, leveraging economic incentives, infrastructure investments, and political influence to shift Panama's allegiance.
At the same time, U.S. policymakers played a key role in dislodging Beijing from these strategically important ports, one of the few reversals in China's growing influence over Latin American infrastructure. It took me 29 years to see how this mistake was corrected. However, despite this setback, Beijing's long-term goal—isolating Taiwan and expanding its global influence—remains intact. The battle for Panama was never solely about maritime trade; it was a calculated step in China's broader strategy to weaken Taiwan and consolidate its dominance in global affairs.
There is no doubt that China's ultimate goal is to erase Taiwan from the geopolitical stage, and it is investing significant efforts in pressuring Guatemala, Belize, and Paraguay. Future U.S. administrations must make it clear to President Xi that Latin America is not for sale.
References
Moorer, T. H. (1998, June 16). Testimony before the U.S. Senate Foreign Relations Committee on the Panama Canal. U.S. Senate. https://thenewamerican.com/us/politics/foreign-policy/admirals-sound-the-alarm/
Reuters. (2025, January 30). Rubio warns of the risk that China could shut down the Panama Canal in the event of conflict. Reuters. https://www.reuters.com/world/americas/rubio-warns-risk-china-shutting-down-panama-canal-any-conflict-2025-01-30/
Reuters. (2025, March 5). CK Hutchison shares jump 22% after selling stake in Panama Canal to BlackRock. Reuters. https://www.reuters.com/markets/asia/ck-hutchison-shares-jump-22-after-panama-canal-stake-sale-blackrock-2025-03-05/
U.S. Congress. (1997, April 15). National security implications of the proposed leasing of the former Long Beach Naval Shipyard to COSCO. Congressional Record. https://irp.fas.org/congress/1997_cr/h970415-cosco.htm
About the Author:
Jesús D. Romero: Magna Cum Laude graduate from Norfolk State University. Retired U.S. Navy Intelligence Officer and Army Intelligence Operations with 37 years of service. Worked in the defense industry with British Aerospace Systems and Booz Allen Hamilton. Commanded a Defense Intelligence Agency unit in Panama and oversaw operations in the Caribbean, Central America, and South America. Amazon bestselling author and commentator on radio, television, and print media.
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