Hong Kong Company Sells Panama Ports To BlackRock Following Trump's Threats To Take Over Canal

A Hong Kong-based conglomerate agreed to sell control of a unit that operates ports near the Panama Canal after rising pressures from U.S. President Donald Trump, including threats to take over the waterway.

The ports' Hong Kong-based owner, CK Hutchison, will sell the business to a consortium, including BlackRock, Global Infrastructure Partners and Terminal Investment, according to a company statement on Tuesday.

The consortium agreed in principle to acquire units that hold 80% of the Hutchison Ports group, which operates 43 ports in 23 countries. They will also acquire 90% of Panama Ports Co., which operates the two ports in Balboa and Cristobal ports on the Pacific and Atlantic sides of the Panama Canal. The transactions will deliver cash proceeds of $19 billion to CK Hutchison, according to Bloomberg.

The move could be seen as a win for President Trump, who has frequently alleged that "China is running the Panama Canal," adding this month that "we're going to take it back, or something very powerful is going to happen."

CK Hutchison is one of Hong Kong's most valuable publicly listed firms and counts with some of the world's biggest investors as shareholders. One of its subsidiaries, Hutchison Ports, has been involved in the Panama Canal since 1997, The New York Times reports.

Of Panama's five ports, Hutchison's are the biggest— one at each end of the canal. According to the Panama Maritime Authority, Hutchison's ports last year served vessels carrying 39 percent of the cargo containers that passed through the canal, one of the world's most vital waterways.

This isn't the first sale the Hong-Kong based conglomerate has carried out in recent years. The billionaire founder of CK Hutchison, Li Ka-shing, has been outspoken about China's increasing grip on Hong Kong. In 2019, when pro-democracy protests were met with police force and Beijing looked to the city's elites to fall in line, Li called for the authority to exercise restraint.

Since then, Li, a retired 96-year-old, has sold much of his real estate holdings in China and pivoted some of his investments to Europe, a move that has angered Chinese nationalists, according to the Times.

The recent agreement is the latest development in Trump's trade war. On Tuesday, the administration enacted the long-threatened tariffs against Canada and Mexico. At the same time, the 10% tariff that Trump placed on Chinese imports in February was doubled to 20%.

Beijing also retaliated Tuesday with tariffs of up to 15% on a wide array of U.S. farm exports. It also expanded the number of U.S. companies subject to export controls and other restrictions by about two dozen.

By raising tariffs, the U.S. has repaid kindness with enmity, Chinese Foreign Ministry spokesperson Lin Jian said, adding, "I would like to reiterate that the Chinese people have never been afraid of evil, do not believe in ghosts, and have never been bullied."