PANAMA CITY: Panama has formally pulled out of China’s massive Belt and Road infrastructure programme, following pressure from the United States to reduce Beijing’s influence on the Panama Canal, President Jose Raul Mulino announced on Thursday.

Mulino told reporters that the Panamanian Embassy in Beijing had given China the required 90-day notice of its decision not to renew its involvement in the plan.

US Secretory of State Marco Rubio this week made his first overseas trip as the top US diplomat under Donald Trump to Panama, a close US partner in Latin America, and put pressure on the country over its ties with China, after which the Panamanian President Jose Raul Mulino agreed not to contribute to the Chinese initiative.

“Yesterday’s announcement by President @JoseRaulMulino that Panama will allow its participation in the CCP’s belt and road initiative to expire is a great step forward for US-Panama relations, a free Panama Canal, and another example of @POTUS leadership to protect our national security and deliver prosperity for the American people,” Rubio posted on X after departing the country, reported by the Guardian.

President Mulino hits back at Washington claim of allowing China ‘free’ canal use

Professor Yanzhong Huang, a senior fellow at the New York-based Council on Foreign Relations thinktank while interviewing with the Guardian, said Panama’s “significant” decision to exit the BRI showed an early win for the new Trump administration’s “brinkmanship diplomacy”, but it wouldn’t necessarily be replicated easily.

“The US now seems to be increasing its focus on its backyard, Latin America, these countries that still need to rely on US support and trade,” Huang said.

“But I’m not sure that the US could use similar influence to force an Asian country, for example, to make similar concessions. It’s unlike­ly given China is already the most influential actor in that region.”

‘Lies and falsehoods’

While bowing to US pressure to quit BRI project, Panama rejected the United States’ claim that it had secured free passage for government vessels through the Panama Canal. President Mulino told reporters the US assertion about the waterway was “intolerable, simply and plainly intolerable,” adding that he rejected “bilateral relations based on lies and falsehoods.”

Since winning the US election in November, US President Donald Trump has refused to rule out the use of force to seize the canal built by Washington over a century ago and later handed over to Panama.

Around 40 per cent of US container traffic passes through the narrow body of water linking the Caribbean Sea with the Pacific Ocean The new row between Panama and Washington erupted after the US State Department claimed that Panama had agreed to let US government vessels through the canal for free after talks last weekend between Mulino and US Secretary of State Marco Rubio.

In a post on the social media platform X, the State Department claimed the decision would save the US government “millions of dollars a year.” The Panama Canal Authority, which runs the waterway, quickly rejected the claim, saying it had “not made any adjustments” to its tariffs.

Published in Dawn, February 7th, 2025