Maersk Takes Over Two Panama Canal Gateway Ports Following Court Ruling

Danish shipping group Maersk will temporarily assume control of operations at two vital seaports along the Panama Canal after a court ruling declared the contracts awarded to a Hong Kong firm unconstitutional.

The Panama Maritime Authority (AMP) announced these changes on Friday, just one day after the Central American nation's Supreme Court voided the port contracts held by the Hong Kong-based CK Hutchison group.

Geopolitical Context and Court Ruling

The court ruling comes on the heels of repeated threats from US President Donald Trump that the US would seek to reclaim control of the waterway, which he claims is effectively controlled by China.

According to the court's verdict on the annulment of the deal, CK Hutchison's port operation contract contained a “disproportionate bias” in favor of the Hong Kong-based company.

On Friday, the AMP stated that port operator APM Terminals, a division of the Maersk Group, will take over as the “temporary administrator” of the Balboa and Cristobal ports located at opposite ends of the canal.

As such, Maersk will replace the Panama Ports Company (PPC) – a subsidiary of CK Hutchison Holdings. This entity had managed the ports since 1997 under a concession contract that was renewed in 2021 for a 25-year term.

The Importance of the Panama Canal

The canal, an artificial waterway, handles approximately 40% of US container traffic and 5% of world trade. The route has been controlled by Panama since 1999, when the United States – which funded the canal's construction from 1904 to 1914 – handed over control.

Mixed Reactions from Powers and Businesses

Washington on Friday voiced its welcome of the decision. Conversely, Chinese Foreign Ministry Spokesperson Guo Jiakun declared that Beijing “will take all measures necessary to firmly protect the legitimate and lawful rights and interests of Chinese companies.”

For its part, PPC stated that the ruling “lacks legal basis and endangers … the welfare and stability of thousands of Panamanian families” who depend on the company's operations.

Tens of thousands of workers excavated the 82 km (51-mile) route to create the Panama Canal, allowing vessels to travel between the Pacific and Atlantic Oceans without rounding the northern or southern tips of the Americas.

Panama has consistently denied Chinese control over the canal, which is utilized primarily by the United States and China.

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Source: Phaata.com (According to Aljazeera)

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