President Donald Trump has doubled down on his efforts to reassert U.S. control over the Panama Canal, following a high-profile deal that removes Chinese ownership from key port operations. BlackRock, the world’s largest asset management firm, has agreed to acquire two major ports on either end of the canal, alleviating Trump’s concerns about Chinese influence over the critical global trade route.
The deal, valued at $22.8 billion, will see BlackRock and a consortium of investors take control of the Balboa and Cristobal ports, previously owned by Hong Kong-based CK Hutchison. While the agreement doesn’t transfer control of the canal itself. Which remains under Panama’s jurisdiction. Trump has made it clear that he intends to go further, calling for an end to Panama’s toll fees for U.S. vessels and even suggesting military action could be on the table.
Trump’s Push to ‘Take Back’ the Panama Canal
Since before taking office, Trump has repeatedly claimed that China had gained control of the Panama Canal, despite the fact that the waterway has been operated by Panama since its handover from the United States in 1999. In his inaugural address, Trump declared:
“China is operating the Panama Canal. And we didn’t give it to China. We gave it to Panama, and we’re taking it back.”
Trump’s rhetoric has sparked tensions with Panama, as the White House continues to pressure the Panamanian government to align with U.S. economic and security interests.
According to Mike Waltz, Trump’s national security adviser, the U.S. has been engaged in negotiations with Panama’s leadership to address American concerns over port security and Chinese investments in the country.
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BlackRock’s Billion-Dollar Deal: Key Details
The $22.8 billion agreement announced on Tuesday will see BlackRock and its investors take over the Balboa and Cristobal ports, which sit on opposite ends of the 51-mile canal. This acquisition comes as part of a broader purchase that includes 43 other ports across 23 countries, but excludes assets in China and Hong Kong.
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Why This Matters
- The Panama Canal is critical to global trade, handling 4% of all maritime commerce worldwide and more than 40% of U.S. container traffic.
- The Balboa and Cristobal ports are key hubs for transshipment, playing a vital role in the flow of goods between the Pacific and Atlantic Oceans.
- The deal marks a significant shift in U.S. control, as Chinese-owned CK Hutchison had previously held these assets.
“These world-class ports facilitate global growth,” said BlackRock CEO Larry Fink, emphasizing the strategic importance of the investment.
Panama’s Response: Canal Fees and U.S. Expectations
While Trump has celebrated the removal of Chinese ownership from the ports, his demands on Panama’s toll policies remain a point of contention.
During his first foreign trip as Secretary of State, Marco Rubio visited Panama and publicly called for U.S. vessels to be exempt from canal tolls. Arguing that America is obligated to defend the waterway in times of conflict.
“It’s absurd that we would have to pay fees to transit a zone that we are obligated to protect,” Rubio stated.
Panama, however, has not agreed to any changes regarding the fees it charges U.S. ships.
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The History: U.S. Control of the Panama Canal
- The Panama Canal was built and operated by the U.S. from 1914 to 1999, after which it was transferred to Panama under a treaty negotiated during the Carter administration.
- The canal is now a major revenue source for Panama. Contributing nearly $5 billion annually in profits and making up 23.6% of the country’s GDP.
- While the U.S. still plays a major role in security and defense. Full control of the waterway itself remains with Panama.
Despite this, Trump’s comments indicate that he may continue pushing for stronger U.S. influence over the region, potentially setting the stage for further diplomatic disputes.
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Trump’s alliance with BlackRock has split U.S. lawmakers. Senator Marco Rubio praised the move as “a win against Chinese expansionism,” while Rep. Alexandria Ocasio-Cortez called it “a handout to Wall Street that risks global conflict.”
Panama’s president, José Gabriel Carrizo, faces mounting pressure. With 60% of Panamanians opposing foreign privatization, his administration risks collapse if the deal proceeds. “We are not a chessboard for superpowers,” he stated cautiously last week.
The Hong Kong Wildcard
Hong Kong’s role adds another layer of intrigue. BlackRock’s rivals in the canal bid include Hutchison Ports, a subsidiary of Li Ka-shing’s CK Hutchison Holdings—a firm with deep ties to Beijing. “This isn’t just about trade; it’s about control,” said geopolitical analyst Fiona Hill.
What Happens Next?
As BlackRock moves forward with its acquisition, several key developments will shape the future of the Panama Canal dispute:
- Will Panama agree to U.S. demands on toll exemptions? So far, Panamanian officials have resisted Trump’s pressure.
- Could the U.S. take further action to assert control? Trump has not ruled out economic or military leverage.
- Will China respond? With its previous investments now stripped away, Beijing may look for alternative ways to regain influence in Latin America.
As the Panama Canal Authority weighs BlackRock’s offer, the world watches nervously. Will Trump’s gamble secure U.S. dominance, or will China’s economic clout turn the tide? One misstep could disrupt $270B in annual global trade—and redefine power in the Americas.
For now, Trump has secured a major geopolitical win by removing Chinese ownership from Panama’s key ports. However, his broader goal of reclaiming control over the canal itself remains a work in progress.
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