BlackRock Clinches Panama Canal Ownership In A $23Billion Deal

On March 4, 2025, Hong Kong-based CK Hutchison Holding indicated it has sold all its shares in Panama Canal ports to a consortium led by BlackRock in a deal estimated to worth $23 billion.

On Tuesday, March 4, 2025, a Hong Kong-based Conglomerate, CK Hutchison Holding in a filing indicated that it has decided to sell all its shares in Hutchison Port Holdings and Hutchison Port Group Holdings to a consortium led by BlackRock in a deal estimated to worth $23billion, including $5billion in debt.

This comes at a period when President Trump was pressurizing the government of Panama to reduce China’s influence on the ports of Balboa and Cristobal, situated at either end of the Panama Canal. Despite Panama’s President José Raúl Mulino’s rebuttal that China does not have any influence on the port, a submission the Trump government officials have found difficult to accept.

In January, Trump’s secretary of state, Marco Rubio had visited Panama’s president to discuss this issue, alleging that American shippers are compelled to pay a lot for using the ports and that the American security is under threat with China managing the ports.

U.S. Historical Involvements in Panama Canal

To streamline the movement of commercial and military ships between its coasts, the United States decided to build the Panama Canal in the early 1900s. However, based on the initial agreements, Washington handed over the control of the waterway to Panama on Dec. 31, 1999, in fulfilment of the 1977 Treaty signed by President Jimmy Carter.(Panama Canal handover ceremony here)

Details of the Deal

The deal involves BlackRock, which has $11. trillion in assets under its management and its two other subsidiaries, namely, Global Infrastructure Partners and Terminal Investment Limited.

Although the transaction is still tentative, because it requires official approval by the Panamanian government to become effective. The deal transfers 90% ownership of Panama Ports Company and the control of over 43 ports in 23 countries to the BlackRock-led Consortium, which includes the Panama ports of Balboa and Cristobal. Other ports are in Australia, Mexico, Pakistan, the Netherlands, Egypt, and elsewhere are considered parts of the deal, but it does not include any interest in a trust which operates any ports in China, Hong Kong, Shenzhen, and South China.

Why President Trump claims victory over the Deal?

Responding to the deal, President Trump enthusiastically told the U.S. Congress that;

“My administration will be reclaiming the Panama Canal, and we’ve already started doing it. Just today, a large American company announced they are buying both ports around the Panama Canal and lots of other things having to do with the Panama Canal and a couple of other canals.”

Donald J. Trump, U.S. President

However, Panamanian President Jose Raul Mulino had since labelled Trump’s statement as misleading and untrue.

How do ships transit through Panama Canal?

How do ships transit through Panama Canal? Get to know how ships pass from the Atlantic to the Pacific Ocean and vice versa.

Ship Nerd

The Global Economic Importance of the Panama Canal

The Panama Canal is regarded as an important artery for global trade; it handles approximately 4% of the world’s maritime or shipping volume. The Panama ports of Balboa and Cristobal, which are located at either end of the canal, continue to play an important role in streamlining transatlantic trade.

More importantly, the Canal and its other related ports annually generate substantial revenue for Panama. It is on record that in 2024, the canal brought in almost $5 billion in profits. The number of annual vessel transits through the Canal is estimated to be well over 10,000 vessels each year.On average, the annual cargo volume shipped through the canal from 2020 to 2023 was estimated to be about 600 million tons. As a matter of fact, the canal witnesses an average of 36-38 vessels per day—this largely depends on the transit restrictions and mixture of vessels.

Economic Impact

Without doubt, the Panama Canal wields significant economic influence in transatlantic trade having, in the fiscal year 2024, generated a sum of $3.381 billion from shipping operations through its ports. It was reported that the canal registered up to 11,240 transits of deep and small commercial vessels in 2024 as they transported 210-million long tons of cargoes and containers.

Panama Canal congestion and new measures to handle it

The Panama Canal Authority (ACP) highlights the real congestion numbers at both ends of the waterway and advises measures to regulate it.

Ship Nerd

A Possible Post-Deal Scenario

As the deal is yet to be officially approved by the Panama Government, it is difficult to imagine how the transaction will eventually play out. On its part, China has debunked much of the allegations levied against it by some Trump officials. The Panama Canal is very important to Chinese shippers as they use it mainly for their transatlantic trades.

As the Trump government continues to mount pressure on the Panama Government, Panama has decided to quit China’s Belt and Road Initiative (BRI) after Marco Rubio’s visit, an action that infuriated Chinese authorities. The Belt and Road Initiative is China’s international development efforts to facilitate international trade by building roads, ports and railways to open up new markets.

It is undeniable that Panama is caught between two superpowers, and their action in the near future will decide whether they will infuriate President Trump and find themselves sanctioned by the American government. Leaving the Beijing’s Belt and Road Initiative (BRI) will deny Panama economic and political alliances with over 145 countries that have already joined the Belt and Road Initiative (BRI) by signing a Memorandum of Understanding (MoU) with China. This includes nations from Africa, Southeast Asia, the Caribbean, Central Asia, Europe, East Asia, Europe, Latin America, the Middle East, and the Pacific.

It is evident that the Trump Presidency is seriously concerned about the Panama Canal drama, and he has publicly denounced the rationale for handing the canal to Panama in the first place, since America paid for its construction.

The Takeaways

The current situation of things about the Panama Canal reveals how geo-political interests can threaten or affect the smooth management of ports’ activities and threaten maritime operations in any part of the globe.