Hong Kong’s richest man Li Ka-shing’s company, the CK Hutchison Group, plans to sell ports to an American consortium, facing pressure from the Chinese Communist Party’s propaganda and anti-monopoly scrutiny, causing a month-long turmoil with no results. Experts believe that Beijing is now caught in a “lose-lose” situation. Whether Li Ka-shing ultimately sells the ports or not, the impact on the Chinese authorities is extremely negative, with a high possibility of Li Ka-shing successfully completing the deal.
During the National People’s Congress and Chinese People’s Political Consultative Conference sessions (known as the “Two Sessions”), on March 4, CK Hutchison Group announced a preliminary agreement with a consortium led by BlackRock from the United States, transferring its holdings or operations in 43 ports worldwide across 23 countries, including two ports in the Panama Canal, which stunned the market.
Starting from March 13, the Chinese Communist Party’s mouthpiece in Hong Kong, Ta Kung Pao, published a series of articles and commentaries criticizing CK Hutchison’s port sale as “disregarding national interests,” suggesting that the Chinese authorities could review the transaction using the Anti-Monopoly Law and National Security Law. Several articles were republished by China’s Liaison Office and Hong Kong and Macau Affairs Office.
On March 28, the head of the Anti-Monopoly Department of China’s State Administration for Market Regulation announced that they would review the transaction. The following day (March 29), China’s state broadcaster CCTV’s new media platform directly criticized CK Hutchison, although the article was later removed.
The pro-Beijing Hong Kong media, South China Morning Post, on March 28 stated that CK Hutchison would not officially sign the agreement to sell its operating rights for two strategic ports in the Panama Canal as planned on April 2. However, April 2 was not the “true final deadline” for CK Hutchison to negotiate with BlackRock, but rather the earliest possible date for both parties to sign the agreement.
Over the past month, CK Hutchison has not publicly responded to the event, and the final outcome of this century-defining deal is still under scrutiny. Some experts currently believe that the ongoing issue of Li Ka-shing selling the ports is not favorable for the Chinese Communist Party. Regardless of whether Li Ka-shing completes the transaction as planned, the impact on Beijing is negative.
Commentator Tang Jingyuan, who is based in the United States, told Epoch Times that China’s forced intervention in Li Ka-shing’s port sale event does not benefit the Chinese Communist Party regardless of the outcome. If these ports are successfully sold, it will cause China to lose a batch of strategically important ports, showing the world that the Chinese government is merely a paper tiger. If China forcibly prevents the deal, it will still be seen as a significant loss of face for Beijing.
Tang Jingyuan further stated that if Li Ka-shing ultimately does not sell these ports under pressure from the Chinese Communist Party, it will be clear to the world that China can exert control over enterprises within and even beyond its jurisdiction for political purposes. This will deter foreign investment in the Chinese market and hinder Hong Kong businessmen from conducting business with foreign partners, as they may fear being controlled by the Chinese government at any time.
In Tang Jingyuan’s view, high-ranking Chinese officials are actively seeking foreign investment, but the Li Ka-shing incident has severely damaged this atmosphere. Regarding the Panama port issue, he emphasized that the United States holds significantly more leverage than China. From the historical significance of the Panama port to the trade war that the U.S. has been waging against China, the U.S.’s bargaining power far exceeds that of China in this situation.
He believes that Li Ka-shing does not want to be entangled in the geopolitical games of the two countries, making it more likely that the sale of the ports will eventually be completed. Li Ka-shing still possesses numerous resources that could potentially be used by the Chinese Communist Party as tools for geopolitical competition in the future, posing endless troubles for the Li family. “Therefore, Li Ka-shing may prefer to make a clean break rather than be continuously exploited by the Chinese Communist Party in the future.”
American economist David Huang also stated that whether Li Ka-shing sells the ports or not, it is not a good situation for China. This deal presents a lose-lose scenario for Beijing, as its influence and control in the global order accumulated over the past decade are rapidly declining.
Huang analyzed that Beijing’s strong intervention in Li Ka-shing’s transaction undermines economic freedom. If the ports are not sold, it would export the “Party leads everything” model overseas, causing international capital to become more concerned about the risks of cooperating and investing with mainland China. It would also diminish Hong Kong’s role as a buffer zone for Chinese outsourcing businesses, leading to a collapse of Beijing’s credibility in the global capital market system.
Huang emphasized that Panama is a strategic hub connecting the Pacific and Atlantic Oceans and is vital to the United States. Moreover, controlling the Panama Canal is tantamount to eliminating China’s influence in Central and South America through the Belt and Road Initiative, a strategic move that the Trump administration must take to regain control of its “backyard.”
Huang further outlined the leverage that the U.S. holds, including financial leverage with BlackRock’s significant global influence, diplomatic leverage due to the multifaceted relationships between the U.S. and countries in Central and South America, and security leverage, as the port issue intersects with U.S. global strategic deployment, enabling the U.S. to restrict Chinese enterprise participation based on citizen safety concerns.
Huang warned that if Li Ka-shing’s port deal falls through due to the Chinese Communist Party’s pressure via propaganda or the anti-monopoly investigation, it would showcase a non-market, non-institutional, and non-legal pattern that would severely damage China’s economic and trade relations and political image, resulting in a further negative international perception. This would make it more difficult for Beijing to expand the Belt and Road Initiative in Central and South America in the future.