CK Hutchison Holding sold ports along the Panama Canal to American investment giant BlackRock, Global Infrastructure Partners and Terminal Investment in a deal valued at about $28 billion. 

BlackRock was founded in 1988 by eight partners and has grown into a trillion-dollar company by acquiring other companies and managing individual investments.

This deal happened after President Donald Trump mentioned that the canal was under Chinese control with CK Hutchison in control of major ports as it is a Hong Kong-based company.

“China is operating the Panama Canal,” Trump said. “And we didn’t give it to China. We gave it to Panama, and we’re taking it back.”

Trump threatened to take the canal if something was not done to remove Chinese control. 

The canal was made in the 1900s by the United States as a way for America to transport military equipment and for international trade. President Jimmy Carter signed a treaty in 1977 to give the canal to Panama by the year 2000. The treaty went into effect in 1999, which is when Panama took over the canal. Trump believes this was a bad decision made by President Carter. 

The canal also became a neutral zone and connected 1,920 ports through 170 countries. 

According to CNN, the canal earned over five billion in profit and accounts for about 23% of Panama’s income. 

Senator Ted Cruz made many claims that China could block passage using the canal because America sent about 70% of its container ships through these ports in January.

 After U.S. Secretary Marco Rubio visited in February, Panama removed itself from China’s Belt and Road project.  This project is meant to give more connections and gain cooperation between Asia, Europe and Africa to the rest of the world through infrastructure, transportation and trade. The project was started in 2013 and has helped China grow economically. 

This has American government officials worried for national security because the ports could be used by China as a way to spy.

The first two ports are in Balboa and Cristobal, which are at the ends of the canal. They are also taking over 43 other ports from Hutchinson that span 23 countries such as Mexico, Australia, Pakistan and Egypt. 

“I think that putting one person in responsibility of all that is dangerous and can lead to more, like, I guess corruption is the word, where managing everything is not good for this individual company,” said Sydney Carrol, a sophomore psychology major. 

Panama’s president has stated multiple times that China has no control over the canal or the way it is run. 

This deal has to be approved by the Maritime Authority of Panama and they have requested the legal and financial documents regarding the deal. 

The Authority will look over these documents to ensure that this deal does not harm anyone.

After the deal, Hutchison stocks dropped and China disagreed with the deal claiming that this was a betrayal to the Chinese people.

Some students feel that this purchase could be bad and cause problems between countries.

“I feel like that creates tensions between other people and countries,” Carrol said. 

 Even though CK Hutchison will keep its Chinese ports the government is still very upset and many think if the government does not agree the deal may fall through.

“I’m not aware that any approval from Chinese regulators is required given CKH is retaining all of its existing Chinese ports,” Dan Baker, a senior equity analyst for Morningstar, told CNN. 

China feels that America is forcing Panama to comply by making them back out of deals with them to get what America wants. 

With the canal now under the control of an American company, Trump has started making plans to build a U.S. military presence along the canal. The planning could also include using Panama’s security forces but plans have not been finalized.