Summarize this content to 2000 words in 6 paragraphs Panama’s President José Raúl Mulino has said the country will not renew a trade and development agreement with China after President Donald Trump accused the Chinese of controlling the Panama Canal.Mulino announced he would not renew Panama’s participation in China’s Belt and Road Initiative once the current agreement expires, following a meeting with U.S. Secretary of State Marco Rubio on Sunday.Newsweek has contacted the U.S. State Department and the U.S. Embassy in Panama for comment via email.Why It MattersTrump has repeatedly suggested the U.S. should demand the return of the Panama Canal if Panama does not reduce the fees it charges American ships. He has also frequently accused China of controlling the key global trade route.Mulino’s announcement that Panama will not renew a 2017 memorandum of understanding to participate in China’s Belt and Road Initiative suggests the country may be hoping to appease Trump amid his threats of retaliation unless it reduces China’s influence.
President Donald Trump talks to reporters from the Resolute Desk in the Oval Office at the White House on January 30, 2025 in Washington, D.C.
President Donald Trump talks to reporters from the Resolute Desk in the Oval Office at the White House on January 30, 2025 in Washington, D.C.
Chip Somodevilla/Getty Images
What To KnowChina’s Belt and Road Initiative is a global infrastructure development strategy aimed at enhancing trade, investment, and economic cooperation by building infrastructure across Asia and other parts of the world.The initiative has been criticized for burdening participating countries with debt, as many struggle to repay Chinese loans for large-scale projects. More than 150 countries and 30 international organizations have signed agreements to participate.Panama has now announced it will withdraw from its initial agreement to be part of the Belt and Road Initiative and intends to work more closely with the U.S.Speaking to reporters on Sunday, Mulino said his meeting with Rubio “paves the way” for building new relationships and increasing potential U.S. investments in Panama.In a series of posts on X, formerly Twitter, Rubio said the U.S. must remain “vigilant in protecting” the Panama Canal from the Chinese Communist Party and that the U.S. “cannot and will not” allow China’s growing control over the canal.The Panama Canal was transferred from U.S. control to Panama in 1999 under a treaty signed in 1977 by President Jimmy Carter.State Department spokesperson Tammy Bruce said that Panama risks violating the Treaty Concerning the Permanent Neutrality and Operation of the Panama Canal by allowing Chinese influence. Trump made a similar claim on Sunday, warning that “something very powerful” could happen if Panama violates the treaty.Mulino said Rubio made “no real threat of retaking the canal or the use of force” during their meeting. He added he did not “feel like there’s a real threat against the treaty and its validity,” reported The Associated Press.China has denied all allegations that it has any role in operating the Panama Canal.Mulino also gave an update after Panama recently said it would audit a Hong Kong company that operates two terminals near the Panama Canal. The move was seen as a way to downplay Trump’s fears of Chinese influence on Panama Canal.Hutchison Ports, a subsidiary of Hong Kong-based conglomerate CK Hutchison Holdings, renewed a contract with Panama allowing it to operate these ports until 2046. The contract could be revoked depending on the audit’s findings or, a new bidding process launched.”We have to wait until that audit ends before we can reach our legal conclusions and act accordingly,” Mulino said, via CNN.What People Are SayingU.S. Secretary of State Marco Rubio posted on X: “I met with Panamanian President Mulino and Foreign Minister Javier Martínez-Acha Vásquez to make clear that the United States cannot and will not allow the Chinese Communist Party to continue its effective and growing control over the Panama Canal area. We also discussed efforts to end the hemisphere’s mass migration crisis and ensure fair competition for U.S. firms. The Panama Canal is vital to America’s national and economic security interests. We must remain vigilant in protecting this vital asset from the Chinese Communist Party.”State Department spokesperson Tammy Bruce said in a statement: “Secretary Rubio informed President Mulino and Minister Martínez-Acha that President Trump has made a preliminary determination that the current position of influence and control of the Chinese Communist Party over the Panama Canal area is a threat to the canal and represents a violation of the Treaty Concerning the Permanent Neutrality and Operation of the Panama Canal. Secretary Rubio made clear that this status quo is unacceptable and that, absent immediate changes, it would require the United States to take measures necessary to protect its rights under the treaty.”Charlie Kirk, political commentator and founder of Turning Point USA, posted on X: “The President of Panama, José Raúl Mulino, vows NOT to renew the 2017 Chinese contracts on the Panama Canal that are part of the CCP’s Belt and Road Initiative. The contracts come up in one or two years but could be even sooner. A good start!!”President Donald Trump told reporters on Sunday: “Panama right now. And we’re talking about the Panama Canal. What they’ve done is terrible. They violated the agreement. They are not allowed to violate the agreement. China is running the Panama Canal. That was not given to China. That was given to Panama, foolishly. But they violated the agreement. And we’re going to take it back or something very powerful is going to happen.”What Happens NextPanama could withdraw from China’s Belt and Road Initiative before the current agreement expires.It is unclear whether Trump would be satisfied if Hutchison Ports were replaced with a U.S. or European company.
