Hong Kong firm 'failed to uphold canal ports contract'

THE Hong Kong firm in charge of two key Panama Canal ports has flouted the terms of its contract, according to a Panamanian audit release on Monday, as US and Chinese firms fight for business on the waterway that President Donald Trump threatened to seize.

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THE Hong Kong firm in charge of two key Panama Canal ports has flouted the terms of its contract, according to a Panamanian audit released on Monday, as US and Chinese firms fight for business on the waterway after President Donald Trump threatened to seize it.

The audit found "many breaches" of the concession awarded to a subsidiary of logistics giant CK Hutchison to operate the two ports, and concluded that Panama did not receive the $1.2 billion (R23.3bn) it was owed under the contract.

The subsidiary, called Panama Ports, benefited from many tax exemptions and also had irregularities in a previous audit that was used to justify an extension of the concession first awarded in 1997, said state comptroller Anel Flores.

"This is a very delicate issue," Flores said, adding that he would file a complaint with prosecutors in the coming days over the unpaid concession fees.