US Politics
Hong Kong firm seeks $2 billion over Panama’s takeover of 2 key canal ports
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A subsidiary of a Hong Kong-based company that has lost control of two critical ports on the Panama Canal said it is seeking $2 billion of compensation in damages from Panama over its “illegal” takeover of the ports.
Panama Ports Company, a unit of Hong Kong’s CK Hutchison Holdings, said in a Friday statement that it is demanding the sum under international arbitration proceedings that it had already started.
Panama’s government last week seized control of the Balboa and Cristobal ports on each end of the Panama Canal, a crucial waterway for maritime trade, after the country’s Supreme Court declared earlier that a concession allowing the Panama Ports Company to run the pair of ports was unconstitutional.
Panama Ports Company operated the two ports since 1997 and had only renewed its concession in 2021 for another 25 years. Beijing and Hong Kong’s governments had also hit back at Panama over the seizure of the two ports.
The two ports came into the spotlight after U.S. President Donald Trump, early last year, accused China of “running” the Panama Canal.
After CK Hutchison announced a deal in March last year that it would sell the bulk of their dozens of global ports, including the two Panama ports, to a consortium that involved U.S. investment firm BlackRock in a $23 billion deal, Beijing was quick to protest and the deal has been largely stalled over the past months.
CK Hutchison and the Panama Ports Company “will not relent and they are not coming for some token relief – they will assert all of their rights and damages they are due because of the radical breaches and anti-investor conduct of the Panamanian State,” Friday’s statement said.
In the statement, Panama Ports Company also said the Panamanian state had previously misstated the compensation figure sought in press comments. Panama Economy Minister Felipe Chapman had earlier said the company was seeking $1.5 billion in compensation.
In a separate statement on Friday, CK Hutchison accused Panama of occupying the two ports and taking the property and personnel of the Panama Ports Company “without transparency.” The company also said it would continue to “pursue recourse to available national and international legal proceedings” on the matter.
