China disagrees with the Panama Canal Agreement but does not block it

The imposition of US duties rearranges global trade to an extent that cannot be perceived. At the same time another decision by the US president, to control the Panama Canal, has equally significant consequences and shows that the trade war with China has « lit up for good ».

The initial statements of the US president, extremely aggressive against Panama, but also indicative of the intentions of the new White House. Donald Trump argued that Panama was a vital infrastructure for the interests of the United States that was under Chinese influence and had to be put again under Washington control.

In early March, the announcement of the acquisition of two major ports in the Panama Canal by Blackrock, in a $ 23 billion agreement, closed a positive deal for the US a deal that the new US government longed for and supported them. « We didn’t give it (the channel) to China, we gave it to Panama and we take it back, » the US president said.

Reduction of the World Network

Despite the storm of reactions caused by Trump statements about the ownership of the Canal and the surprise created by Blackrock’s move- the largest investment company in the world- to get involved in the case, few would bet that China would remain « silent ».

And not only for the loss of control in the Panama Canal but also for the extent of the deal signed by Blackrock with Hong Kong Hutchison, which includes control of a total of 43 ports in 23 countries.

China seems to lose a lot from CK Hutchison’s deal with Blackrock and what is left to answer is how far it is willing to reach (Beijing) to resist a $ 23 billion deal that would reduce its worldwide port network and its worldwide network.

After all, it was the way in which he welcomed a website and was republished in Ta Kung Pao, a pro -Kincani newspaper in Hong Kong. « It has sold all the Chinese, » the main comment said, adding that the companies involved would « have to look at which side they stand, » warning that the deal could harm China’s maritime trade and the global Belt and Road infrastructure system.

The Wall Street Journal said Xi Jinping, China’s leader, was outraged by the deal, and Bloomberg said the mainland services were looking for potential violations of security or antitrust legislation.

Choices

However, none of China’s central media or government offices have immediately condemned the agreement. A Chinese delegation that visited Panama over the weekend also kept a low profile, suggesting that Si continues to weigh his choices.

Of course, the attempt to torpedo the deal is also dangerous for China. It would increase tensions with America while planning mutual visits of leaders. It would also give a weight not only to D. Trump’s excessive claim that China is « handling » the Panama Canal, but also to wider international security concerns about Chinese ports, including them in Europe and Australia.

It would also reinforce the conflicts about companies such as Huawei and ByTedance (owner of Tiktok).

The ports of the Panama of CKH represent a limited potential threat to US security interests and the deal could allow America to use its influence, as well as China, to shape global maritime trade through agreements that guarantee loads of cargo.

Combined with other measures, such as proposed charges for Chinese ships using American ports, could also help limit China’s exports to America, including those via Mexico, where CKH holds four terminals.

Priorities

But these efforts, which are aimed at revitalizing US exports and shipbuilding, may not succeed, estimates Jacob Gunter of the Mercator Institute for China Studies, a Berlin -based thought tank.

Even if the agreement proceeds, China will still have an influence on maritime trade through its sovereignty in shipbuilding and shipping, as well as its remaining ports. After all, a smaller port network may not be a bad thing if profits are affected by the expected recession of world trade.

However, the Chinese leader’s current priority is to prevent a full -scale trade war with America, as his impact on China could be more detrimental to him. He may hope that he will also settle for Taiwan.

Seeing Mr Trump’s involvement with Panama, there could also be room to cut some ports from the agreement during the 145 -day « window » for exclusive negotiations. The concession will be painful for Mr Si but the resistance, in this case, could be worse.

Source: OT