On December 27th (last Saturday), near the entrance of the Panama Canal, a monument symbolizing the friendship between China and Panama was ordered to be demolished by the local government.
This action comes as US President Trump has been warning in recent months that the US should regain control of the Panama Canal. Trump claims that China has too much influence over the operation of the canal.
According to reports from Agence France-Presse, the monument was built in 2004 as a symbol of friendship between Beijing and Panama. It has now been ordered to be demolished by the office of the mayor of Arraijan, Panama.
In a statement, the mayor’s office said that the monument, overlooking the Bridge of the Americas waterway, had structural damage posing a “safety risk.”
After inspecting the demolition site, Chinese Ambassador to Panama, Xu Xueyuan, said that this has brought a significant strain on the bilateral friendship between China and Panama. Chinese Foreign Ministry spokesperson Lin Jianzhou also stated that China is seriously dissatisfied with the actions of the local government of Panama and has made strong representations to the Panamanian authorities. China has demanded a thorough investigation into the matter.
Panamanian President Jose Raul Mulino stated that the decision by the local government to demolish the monument has no legitimate reason and is an irrational act.
The US and China are the major users of the 80-kilometer-long Panama Canal, through which 5% of global maritime trade passes. It has increasingly become a focal point of contention between the US and China.
The Panama Canal was completed in 1914, with the US playing a crucial role in its construction and management. The US maintained control over the canal until 1977 when then-US President Jimmy Carter signed a treaty transferring operational control to Panama.
While the control of the canal lies with the Panama Canal Authority, in recent years, China’s influence in Panama and the Panama Canal has been growing, causing concern for the US government. Two of the five ports on the Atlantic and Pacific sides of the canal are operated by subsidiaries of Hong Kong conglomerate, Hutchison Whampoa, now part of CK Hutchison Holdings.
Trump has repeatedly claimed that Beijing is effectively running the canal and that the US will take it back. Under pressure from the Trump administration, in March of this year, Hong Kong’s CK Hutchison Holdings, controlled by the Li Ka-shing family, agreed to sell its Panama Canal ports to a consortium led by BlackRock Inc., but the deal’s prospects remain uncertain due to Chinese obstruction.
Under US pressure, President Mulino of Panama has also pledged not to sign any further agreements related to China’s Belt and Road Initiative.