Panama will withdraw from China’s Belt and Road Initiative (BRI), President Jose Raul Mulino announced following talks with U.S. Secretary of State Marco Rubio.
"I have made an important decision and I am informing you of it," Mulino said, as cited by The Moscow Times. "My government will not renew the 2017 memorandum of understanding on the Belt and Road Initiative. That is true. We will study the possibility of ending the project early."
Recently, the U.S. has increased pressure on Panama over China’s growing influence in the strategic waterway. President Donald Trump has repeatedly expressed concern over China’s role in the Panama Canal, warning that its involvement violates the 1999 treaty that transferred control of the canal from the U.S. to Panama.
Trump Pressures Panama Over Canal Control
According to Mulino, Rubio did not make a direct threat to reclaim the Panama Canal or use force but relayed that Trump views China’s presence in the canal area as a treaty violation.
The U.S. State Department issued a statement warning that if Panama does not take immediate action to reduce China’s involvement, Washington would be forced to "protect its rights."
Trump has long criticized U.S. loss of control over the canal, arguing that American ships are overpaying for passage while China’s influence in the region grows.
"We didn’t give it to China, we gave it to Panama, and now we’re going to take it back," Trump declared in his 2025 inauguration speech.
The Hong Kong-based company Hutchison Whampoa Ltd., which operates cargo terminals on both ends of the canal, has been a particular point of concern for the Trump administration.
China’s Belt and Road Initiative (BRI), launched by President Xi Jinping in 2013, aims to expand global trade networks through infrastructure and logistics investments. As of 2023, 149 countries across Asia, Africa, Europe, and Latin America had signed onto the initiative.
Panama joined in 2017, deepening economic ties with Beijing, but Washington has repeatedly warned against China's growing influence in the region.
U.S.-Panama Canal Relations
The Panama Canal has long been a critical focal point in U.S. foreign policy.
In 1903, Washington backed Panama’s independence from Colombia in exchange for control over the canal, an arrangement originally intended to be permanent.
But in 1977, amid rising anti-U.S. sentiment, President Jimmy Carter signed treaties agreeing to transfer full control to Panama by 1999. The agreement also prohibited the U.S. from maintaining military bases in the canal zone, although it retained the right to transit military vessels through the strategic waterway.
