Just hours after US Secretary of State Marco Rubio landed in Panama for his first overseas visit, Panama President Raúl Mulino said his country would not renew the pact to join China's Belt and Road initiative.
Hinting that the deal with China could end early, Mulino said Panama would seek to work with the US on new investments, including infrastructure projects. "I think this visit opens the door to build new relations … and try to increase as much as possible US investments in Panama," Mulino told reporters.
Mulino's statement came as Rubio met him in Panama on Saturday to state in no uncertain terms that the Central American ally must immediately reduce Chinese influence over the Panama Canal area or face potential retaliation from the Trump administration.
🚨BREAKING: Panama's President has ended the country's Panama Canal deal with China, immediately following a meeting with U.S. Secretary of State Marco Rubio.
— Benny Johnson (@bennyjohnson) February 2, 2025
Are we tired of winning yet?
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Rubio, who echoed Trump's warning of retaking the Canal, told Mulino that the Trump administration's preliminary assumption was that China's presence in the area violates a treaty with the US, signed during the handing over of the Canal. That treaty calls for the permanent neutrality of the American-built canal and permits US to intervene militarily if the canal's operations were disrupted by internal conflict or a foreign power.
"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,” the State Department's readout of the meeting said.
However, Mulino maintained that Rubio made "no real threat of retaking the canal or the use of force." But, he soon made it clear that Panama was dropping the Belt and Road deal with China.
Mulino acknowledged Rubio raised China's role in the port but quickly clarified that the consortium controlling them was being audited. The company linked to China operates two terminals around the Canal. "We have to wait until that audit ends before we can reach our legal conclusions and act accordingly," Mulino said.
The canal authority would give Rubio a more detailed explanation, he added.
Meanwhile, Trump has reiterated his warning against Panama. He told reporters at Joint Base Andrews on Monday that Panama violated the agreement. "China is running the canal, it was not given to them. It was given to Panama foolishly. But they violated the agreement, and we’re either going to take it back or something very powerful is going to happen," he added.
