Beyond Panama Canal, Trump stares at China's influence in Latin America

China has displaced the US as top trading partner for nearly all of region's 33 nations

- Bhagyashree Garekar

WASHINGTON - The Trump administration savoured a quick victory after a Hong Kong conglomerate this week decided to hand over its stakes in two major Panama Canal ports to a consortium led by a powerful American investment firm.

But it is small consolation for Washington in its broader tug of war with China in Latin America.

US President Donald Trump, who made countering China a key theme of his presidential campaign, has declared his intention to retake the Panama Canal in several speeches since his election in November 2024. His most forceful call was during his Jan 20 inauguration.

The US built the canal, which serves 40 per cent of US seaborne container trade, between 1904 and 1914, before turning it over to Panama in 1999.

But Mr Trump contends that China has been effectively "operating" the vital waterway, which is fully owned and run by the Panama Canal Authority, an autonomous government agency.

The March 4 deal struck between New York-headquartered BlackRock and Hong Kong tycoon Li Ka Shing's CK Hutchison Holdings was a step forward in the effort at "reclaiming" the canal, Mr Trump noted in his address before a joint sitting of Congress on the same day.

BlackRock and its co-investors will buy Hutchison's stake in the two ports sited at the Atlantic and Pacific ends of the canal, and over 40 others worldwide, for about US$22.8 billion (S$30.4 billion).

Hutchison, a publicly listed company, is not financially linked to the Chinese government, though Hong Kong firms are subject to state oversight.

The high-profile deal highlights China's heft in the vast region, which extends from the southern US border to the southernmost tip of South America.

China has already displaced the US as the top trading partner for nearly all of Latin America's 33 nations, and is aggressively expanding its economic footprint as it acquires stakes in fintech and artificial intelligence-driven start-ups across the region.