The Panama Canal has become the latest pressure point in a widening contest over global shipping, with the United States and several regional partners accusing China of targeting Panama-linked vessels and Beijing rejecting the charge as political distortion.
The dispute matters because the canal is one of the world’s most important trade arteries, carrying about 6 percent of global trade, and because it is unfolding as the Strait of Hormuz remains severely disrupted. Together, the two crises are sharpening concerns that major shipping lanes are becoming arenas for geopolitical pressure rather than neutral routes for commerce.
In a joint statement Tuesday with Bolivia, Costa Rica, Guyana, Paraguay, Trinidad and Tobago, the United States condemned what it described as Chinese economic pressure affecting Panama-flagged ships. The countries accused China of detaining Panama-flagged vessels in Chinese ports, calling the alleged actions “a blatant attempt to politicise maritime trade and infringe on the sovereignty of the nations of our hemisphere.”
China denied the accusation. Lin Jian, a spokesperson for China’s Ministry of Foreign Affairs, said Wednesday that the U.S. claims “are completely unfounded and distort reality,” and accused Washington of politicizing ports and disregarding the sovereignty of countries in the region.
Why Panama is at the center
The immediate dispute follows a January decision by Panama’s Supreme Court to scrap a long-running concession held by a Hong Kong-linked company to operate the Balboa and Cristobal ports, key facilities at either end of the canal. The ruling came amid sustained U.S. pressure on Panama to limit Chinese influence around the waterway.
U.S. President Donald Trump has repeatedly suggested since beginning his second term that the United States could take control of the Panama Canal, while accusing China, without evidence, of managing the route. Beijing criticized the Panamanian court decision, saying Panama had yielded to hegemonic power.
Washington says the problem has since moved from rhetoric to commercial pressure. The U.S. Federal Maritime Commission said last month there had been “a surge in detentions” of Panama-flagged vessels after the court ruling, far above historical patterns. U.S. Secretary of State Marco Rubio has called China’s alleged actions “bullying” and said they raise concerns about economic leverage being used against Panama’s sovereignty. China says the charges are groundless.
Panamanian President Jose Raul Mulino appeared to welcome outside backing while trying to avoid escalation. In a statement Wednesday, he thanked “friendly countries” for their solidarity regarding Panamanian-flagged ships held in Chinese ports, but added that Panama does not want controversy and values respectful relations with all nations.
The Hormuz backdrop
The Panama dispute is gaining attention partly because another strategic waterway, the Strait of Hormuz, has already been thrown into crisis. The strait, through which about one-fifth of the world’s oil and liquefied natural gas supplies normally move in peacetime, has remained almost entirely closed to shipping since Iran laid mines across it in March, according to reporting from the region.
Mine-clearing could take months, experts told CBS News, and U.S. capabilities are under scrutiny. Scott Savitz, a senior engineer at Rand Corporation and former adviser to the U.S. Navy’s mine warfare command, said the Navy has neglected mine countermeasures for more than two decades. The Pentagon told CBS News that U.S. forces are using manned and unmanned capabilities to reduce mine risks and ensure safe passage.
Ukraine’s Black Sea experience has entered the discussion because Ukrainian firms have developed sea drones used to map minefields during Russia’s war. Ukrainian President Volodymyr Zelenskyy has said Kyiv is ready to share expertise if asked, though he said no one had requested Ukrainian help with Hormuz.
What could change the stakes
Analysts cited in the reporting warn that disruption at the Panama Canal, even if temporary, could ripple through global supply chains. Ferdinand Rauch, an economics professor at the University of St Gallen, said a prolonged interruption could create bottlenecks, market volatility, inflation pressure and measurable harm to global growth.
The effects would depend on the scale and duration of any disruption. Stephan Maurer of UPF Barcelona School of Management said trade between the U.S. East Coast and Asia would be especially exposed, along with routes involving South America’s west coast, because alternatives would add long distances, including routes around the southern tip of South America.
For now, the Panama Canal itself has not been reported closed in the supplied material. The unresolved question is whether accusations over detained or delayed ships remain a diplomatic clash — or become another test of whether global shipping routes can stay insulated from great-power confrontation.
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