HONG KONG (AP) — Hong Kong's leader has waded into a controversy over a prominent conglomerate’s decision to sell its Panama Canal port assets to a consortium including American investment bank BlackRock Inc., a deal that has angered Beijing and highlights how escalating tensions between Beijing and Washington can leave the Chinese financial center’s business leaders trapped in the middle.
Chief Executive John Lee told reporters at a weekly news briefing that CK Hutchison Holdings' in-principle agreement to sell its controlling stake in a company operating ports at both ends of the Panama Canal was being discussed extensively and concerns raised about the deal deserve serious attention. He did not specify what the concerns were.
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A cargo ship sails past the Panama Canal's Port of Balboa in Panama City, Thursday, March 13, 2025. (AP Photo/Matias Delacroix)
A cargo ship sails under Las Americas bridge through the Panama Canal, in Panama City, Thursday, March 13, 2025. (AP Photo/Matias Delacroix)
A U.S. Coast Guard ship docks in a naval base along the Panama Canal in Panama City, Thursday, March 13, 2025. (AP Photo/Matias Delacroix)
A U.S. Coast Guard ship docks at a naval base along the Panama Canal in Panama City, Thursday, March 13, 2025. (AP Photo/Matias Delacroix)
A cargo ship sails past the Panama Canal's Port of Balboa, managed by CK Hutchison Holdings, in Panama City, Thursday, March 13, 2025. (AP Photo/Matias Delacroix)
FILE - Cranes load a cargo ship at the Panama Canal's Balboa Port in Panama City, Sept. 9, 2024. (AP Photo/Matias Delacroix, File)
“(The) government urges foreign governments to provide a fair and just environment for enterprises,” he said. “We oppose the abusive use of coercion or bullying tactics in international economic and trade relations.”
Lee avoided a direct mention of U.S. President Donald Trump and also stopped short of criticizing CK Hutchison or tycoon Li Ka-shing's family, which owns a controlling stake in the conglomerate.
His comments followed a somewhat veiled backlash from Beijing.
Since last Thursday, Beijing’s offices handling Hong Kong affairs have reposted two commentaries by a Beijing-backed local newspaper that blasted the deal. That has raised questions over the sale.
One of the newspaper commentaries suggested the deal is a betrayal to all Chinese and disregards national interests. The other described great entrepreneurs as patriots, but suggested that businesspeople who “dance with” predatory American politicians to reap quick profits were doomed to infamy.
The articles signaled Beijing’s disapproval of the deal, though its actual impact remains unclear.
Posting of the articles has been seen as an indirect attack on the conglomerate by Chinese leaders. Trump, who has alleged Chinese interference with the operations of the critical shipping lane, hailed the deal, saying his administration would “reclaim” the Panama Canal. Panama President José Raúl Mulino accused him of lying.
Lee said any business transaction must comply with Hong Kong's laws. The city will handle it according to the law, he said without elaborating.
Increasing influence from Beijing is adding to pressure on business leaders in the former British colony, that was returned to Chinese rule in 1997.
CK Hutchison did not comment on Lee’s remarks or the articles. It was due to report its 2024 financial results on Thursday, but said it did not plan a news conference.
In Beijing, when asked about reports that China authorities are investigating the potential sale, China's Foreign Ministry spokesperson Mao Ning said reporters should ask other Chinese authorities.
“I would like to stress that in principle, China has been firmly opposing infringing on or undermining other countries’ legitimate rights and interests with economic coercion and bullying,” she said.
The company surprised market watchers when it announced March 4 that it would sell all shares in Hutchison Port Holdings and in Hutchison Port Group Holdings to the consortium in a deal valued at nearly $23 billion, including $5 billion in debt. Hutchison said the transaction was purely commercial and unrelated to other developments surrounding the Panama Ports.
The deal, if approved, will give the BlackRock consortium control over 43 ports in 23 countries, including the ports of Balboa and Cristobal, located at either end of the Panama Canal. Other ports are in Mexico, the Netherlands, Egypt, Australia, Pakistan and elsewhere.
The transaction requires approval by Panama’s government. It does not affect a trust that operates ports in Hong Kong or any other ports in mainland China.
Panama says it has full control over the shipping lane and Hutchison's operation of the ports does not amount to Chinese control over the canal. Selling it to a U.S.-based company does not represent any U.S. “reclaiming” of the canal, it says.
The United States built the canal in the early 1900s, seeking a faster way for commercial and military vessels to travel between its coasts. Washington relinquished control of the waterway to Panama on Dec. 31, 1999, under a treaty signed in 1977 by then-President Jimmy Carter. Trump has claimed that Carter “foolishly” gave the canal away.
Some 70% of the sea traffic that crosses the Panama Canal leaves or goes to U.S. ports.
A cargo ship sails past the Panama Canal's Port of Balboa in Panama City, Thursday, March 13, 2025. (AP Photo/Matias Delacroix)
A cargo ship sails under Las Americas bridge through the Panama Canal, in Panama City, Thursday, March 13, 2025. (AP Photo/Matias Delacroix)
A U.S. Coast Guard ship docks in a naval base along the Panama Canal in Panama City, Thursday, March 13, 2025. (AP Photo/Matias Delacroix)
A U.S. Coast Guard ship docks at a naval base along the Panama Canal in Panama City, Thursday, March 13, 2025. (AP Photo/Matias Delacroix)
A cargo ship sails past the Panama Canal's Port of Balboa, managed by CK Hutchison Holdings, in Panama City, Thursday, March 13, 2025. (AP Photo/Matias Delacroix)
FILE - Cranes load a cargo ship at the Panama Canal's Balboa Port in Panama City, Sept. 9, 2024. (AP Photo/Matias Delacroix, File)
