US Defence Secretary Pete Hegseth has said China poses an ongoing threat to the Panama Canal, but that together the US and Panama will keep the key waterway secure.
Speaking at a ribbon cutting for a new US-financed dock at the Vasco Nuñez de Balboa Naval Base after a meeting with Panama’s President José Raúl Mulino, Hegseth said the US will not allow China or any other country to threaten the canal's operations.
"To this end, the United States and Panama have done more in recent weeks to strengthen our defence and security cooperation than we have in decades," he said.
Hegseth alluded to ports at either end of the canal that are controlled by a Hong Kong consortium, which is in the process of selling its controlling stake to another consortium including BlackRock Inc.
"China-based companies continue to control critical infrastructure in the canal area," Hegseth said.
"That gives China the potential to conduct surveillance activities across Panama. This makes Panama and the United States less secure, less prosperous and less sovereign. And as President Donald Trump has pointed out, that situation is not acceptable."
Hegseth met with Mulino for two hours on Tuesday morning before heading to the naval base that previously had been the US Rodman Naval Station.
On the way, Hegseth posted a photo on X of the two men laughing and wrote that it was an honour speaking with Mulino.
"You and your country’s hard work is making a difference. Increased security cooperation will make both our nations safer, stronger and more prosperous," he wrote.
The visit comes amid tensions over US President Donald Trump's repeated assertions that the United States is being overcharged to use the Panama Canal and that China has influence over its operations.
Panama has denied those allegations.
After Hegseth and Mulino spoke by phone in February, the US State Department published on X that an agreement had been reached to not charge US warships to pass through the canal.
Mulino publicly denied that any such deal had been reached.
Trump has gone so far as to suggest the US never should have turned the canal over to Panama and that maybe the US should take it back.
The China concern was provoked by the Hong Kong consortium holding a 25-year lease on ports at either end of the canal.
The Panamanian government announced that lease was being audited and late on Monday concluded that there were irregularities.
The Hong Kong consortium, however, had already announced that CK Hutchison would be selling its controlling stake in the ports to a consortium including BlackRock Inc., effectively putting the ports under American control once the sale is complete.
Secretary of State Marco Rubio told Mulino during his visit that Trump believed that China’s presence in the canal area may violate a treaty that led the United States to turn the waterway over to Panama in 1999.
That treaty calls for the permanent neutrality of the American-built canal.
But Mulino has denied that China has any influence in the operations of the canal.
