A U-Turn Under U.S. Pressure
In 2017, Panama became the first Latin American country to join the BRI. The agreement allowed significant Chinese investments in the country. However, after years of rising Chinese influence, President Mulino has decided not to renew the deal.
This signals a clear realignment away from China. Moreover, this decision comes amid mounting U.S. pressure. Recently, U.S. Secretary of State Marco Rubio visited Panama City. During his visit, he expressed concerns about China’s growing presence near the Panama Canal, a strategic maritime route.
“The security and sovereignty of Panama are essential for regional stability, and we commend President Mulino’s courageous decision,” Rubio stated.
China “Deeply Regrets” the Decision
Beijing reacted swiftly. Chinese Foreign Ministry spokesman Lin Jian condemned the move. He blamed it on external pressure and stressed the economic benefits that the BRI could have continued to bring.
“We deeply regret this unfortunate decision, which goes against the economic interests and cooperation between our two countries,” he declared in an official statement.
China had invested heavily in Panama, particularly in key ports such as Balboa and Colón. Additionally, China had financed major infrastructure projects, including a railway linking Panama City to the Chiriquí province.
A Strategic Realignment Toward Washington
While Panama’s withdrawal may slow Chinese investments, it opens the door to stronger ties with the U.S..
Following the announcement, Washington pledged to support Panama’s development. The U.S. will increase infrastructure investments and enhance cooperation in security and trade.
For President Mulino, this shift is about protecting Panama’s sovereignty amid growing global tensions.
“Our priority is to ensure sustainable and independent economic development. We want to be a trade partner to all nations, but without compromising our sovereignty,” he stated in a televised address.
A Strong Signal for Latin America
Panama’s decision may set a precedent. Indeed, several Latin American countries that joined the BRI are now reassessing their reliance on China.
Furthermore, some analysts believe this move could encourage other nations to reevaluate their ties with Beijing, especially under U.S. influence.
Regardless, Panama’s exit from the BRI reinforces the idea that Latin America remains a battleground between China and the U.S. At the heart of this rivalry, the Panama Canal remains an essential trade artery and a key geopolitical flashpoint.
