Trump's Panama Canal fight puts Asian ports on notice

Scrutiny over the critical waterway masks deeper fears of China's port power - and any shock therapy on this front could rattle Asia.

- Bhavan Jaipragas

At first glance, US President Donald Trump's crusade against China's non-military maritime influence might seem like a northern hemisphere headache - a problem far removed from Asia's concerns.

In his first four weeks in office, Mr Trump fixated on the national security threat posed by the Panama Canal - the waterway on the other side of the world through which 40 per cent of all American goods pass. He threatened to "take back" the canal from Panama, accusing Hong Kong-based CK Hutchison, the operator of two critical ports at either end of the canal, of price-gouging American vessels and, crucially, of being under Beijing's control.

This bluster over the canal offered an early glimpse of a deeper anxiety about China's rapidly expanding maritime footprint, including in Asia.

On Feb 21, the Trump administration took things a step further - it ramped up a sweeping trade probe under Section 301 of the Trade Act of 1974, the backbone of Mr Trump's 2018 to 2020 trade war against China, alleging that Beijing was tightening its grip on the global "maritime, shipbuilding, and logistics sectors" to America's detriment. While this probe began under Mr Joe Biden in 2024, its shift into a new phase ahead of a March public hearing signals a renewed urgency.

The Trump salvo is two-pronged, directed at China's commercial shipping and its port operations.

The first called for a plan to levy fees on Chinese-built ships that transport traded goods, and mandates requiring a portion of US products to be moved on American vessels. The second is aimed at China's port operations around the world.

The Council of Foreign Relations notes that Chinese influence is driven by US$11 billion (S$14.7 billion) in overseas port investments under the Belt and Road Initiative, China's global infrastructure push, and roughly US$130 billion in shipping subsidies between 2010 and 2019.