Panama has opted not to renew its involvement in the Belt and Road Initiative (BRI) with China, a partnership originally established in 2017, due to diplomatic pressure from the United States. This decision was revealed after a meeting on Sunday between Panamanian President José Raúl Mulino and U.S. Secretary of State Marco Rubio. Rubio conveyed President Donald Trump's concerns about China's growing presence around the Panama Canal, viewing it as a potential breach of the canal's neutrality treaty.
"President José Raúl Mulino's announcement that Panama will allow its participation in the Chinese Communist Party's Belt and Road Initiative to expire is a significant advancement for U.S.-Panama relations and a free Panama Canal," stated the U.S. official on social media. Rubio further highlighted this move as "another example of President Donald Trump's leadership in safeguarding U.S. national security."
The initial agreement with China aimed to boost economic cooperation and attract investment in critical sectors. However, in light of Washington's warnings about the risks of economic dependence and possible political influence from China in the region, Panama has chosen not to continue the agreement.
Moreover, President Mulino expressed his willingness to review concessions granted to Chinese companies in ports adjacent to the canal, noting that audits are currently underway. This could pave the way for new bids involving Western companies if any irregularities are found.
Understanding the Belt and Road Initiative
Also known as the New Silk Road, the Belt and Road Initiative (BRI) is an ambitious global infrastructure and trade project launched by China in 2013. Its goal is to enhance global connectivity through the construction of roads, ports, railways, and other strategic infrastructures, thus facilitating Chinese trade and investments worldwide. Inspired by the ancient Silk Road trade routes that connected Asia, Europe, and Africa over 2,000 years ago, the modern version aims to expand China's economic influence across various global regions, including Latin America and the Caribbean.
Since China initiated the BRI, numerous Latin American countries have signed cooperation agreements to join the initiative, attracting investments in infrastructure and energy. Countries formally participating in the Silk Road include Panama (2017), Venezuela, Chile, Peru, Ecuador, Argentina, Bolivia, Uruguay, Costa Rica, El Salvador, and Cuba. These nations have received Chinese investments in strategic sectors such as transportation, telecommunications, energy, and mining. However, some governments have begun re-evaluating their involvement due to concerns about economic dependency on China and geopolitical pressures from the United States.
Marco Rubio's Visit to Panama
U.S. Secretary of State Marco Rubio made an official visit to Panama as part of his first international tour since taking office on January 21, 2025. During his stay in Panama City, Rubio met with President José Raúl Mulino to discuss bilateral and regional interests.
A key focus of their meeting was China's increasing influence around the Panama Canal. Rubio voiced the U.S. administration's concerns over the involvement of Chinese companies in canal-related projects, suggesting this could violate the neutrality treaty governing the canal's operations.
Additionally, the leaders discussed migration cooperation, particularly regarding the flow of migrants traveling through the region towards the United States. Rubio expressed gratitude to Panama for its efforts in this area and stressed the importance of continued collaboration to tackle shared challenges.
Key Aspects of Panama's Decision on the Belt and Road Initiative
Why did Panama decide not to renew the Belt and Road Initiative agreement with China?
Panama chose not to renew the agreement due to diplomatic pressure from the United States, which expressed concerns over China's growing influence around the Panama Canal and potential breaches of the canal's neutrality treaty.
What was the original purpose of the Belt and Road Initiative agreement between Panama and China?
The original agreement aimed to enhance economic cooperation and attract investments in strategic sectors, such as infrastructure, transportation, and energy, to boost Panama's economic growth.
What are the potential implications of Panama's decision on its relations with China?
Panama's decision could lead to a re-evaluation of existing Chinese investments and concessions in the country, potentially opening opportunities for Western companies and altering Panama's economic ties with China.