Panama pushes to renew its shipping deal with China as vessel detentions spike following the CK Hutchison port dispute.
Panama City, (EFE) — Panama is seeking to renew its maritime transport agreement with China while urging Beijing to apply strictly technical criteria when detaining vessels flying the Panamanian flag at Chinese ports — a practice that has surged since a Chinese conglomerate was forced out of operations at two terminals near the Panama Canal, straining bilateral relations.
Panama’s Foreign Minister Javier Martínez-Acha made the announcement Wednesday, following a meeting in New York on Tuesday with his Chinese counterpart, Wang Yi — the first high-level exchange between the two governments since tensions began.
At that meeting, Panama “requested that (Chinese authorities) strictly follow technical criteria” when detaining Panamanian-flagged vessels, Martínez-Acha told reporters on the sidelines of a cooperation agreement signing ceremony with Israel.
The minister conveyed Panama’s willingness to “discuss how to improve the reliability” of the Panamanian merchant fleet — one of the largest in the world, with 8,638 registered vessels and 233.2 million gross registered tons — a process “already underway,” he noted.
“We are also prepared to discuss the need to sit down and renegotiate the Most Favored Nation agreement for Panama in maritime transport,” Martínez-Acha added.
Panama and China established diplomatic relations in 2017, at the expense of Taiwan, and signed a Maritime Transport Agreement the following year granting the Panamanian merchant fleet Most Favored Nation status in Chinese ports — a designation that carries benefits such as preferential port fees and streamlined procedures. The agreement, initially signed for three years, was renewed for five years in 2021 and is set to expire.
At the meeting with Wang, “the interests of both nations were raised, while of course respecting our sovereignty, our rule of law, and we conveyed our willingness to always work on that basis — mutual respect,” Martínez-Acha said.
The bilateral meeting came amid tensions sparked by the February exit of Chinese conglomerate CK Hutchison from operations at two ports near the Canal, after Panama’s Supreme Court ruled the concession — granted over 25 years ago — unconstitutional. China warned Panama would pay “a high price” for removing CK Hutchison; the company launched an international arbitration claim of at least $2 billion against the Panamanian state, and detentions of Panamanian-flagged vessels at Chinese ports have since multiplied.
In a statement released Tuesday, Panama reiterated at the meeting with Wang “its full respect for the One China principle and its commitment to the Rule of Law and the independent decision-making of its democratic institutions, as well as both nations’ interest in maintaining a mutually beneficial relationship.”
“Our relations are in good standing. We have said that we respect China and we are willing to talk, to discuss matters of mutual interest — always, of course, putting our country’s interests first,” Martínez-Acha said Wednesday.
