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China–Panama relations

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See also: Foreign relations of Taiwan § Panama
China–Panama relations
Map indicating locations of China and Panama

China
Panama

China–Panama relations are the bilateral relationships between the People's Republic of China and Republic of Panama. Relations with the Chinese mainland began in the mid-1800s, and lasted till the end of the Second World War, when Panama ceased recognition of the People's Republic of China and began diplomatic relations with the Republic of China. This continued for decades before Panama began recognizing the PRC in June 2017.

On 26 July 2017, the PRC's Foreign Ministry spokesman said that the trade office of China in Panama had been upgraded to China's Embassy in Panama on 13 July and has started its business.[1] According to experts, China wanted to be in the "driver's seat" in both regional and international politics, and Panama's shift in recognition helped Beijing to consolidate power over Taipei.[2] In a statement after the announcement, Taiwan expressed "strong protest and condemnation", accusing China of luring Panama and infringing on their diplomatic space. The Panamanian Vice President at the time, Isabel de Sant Malo, indicated that the move would increase exports to China, tourism and investment. China's Foreign Minister Wang Yi welcomed the decision as one that was in accordance to the times and in the Panamanian people's best interests.[3]

History

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Before the Second World War

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Relations between Panama (then still a part of Colombia) and Imperial China began in the mid-1800s with the arrival of Chinese 'coolies' to the country. These Chinese immigrants faced widespread discrimination even after Panama gained independence from Colombia in 1903. In 1909, the new Panamanian government stopped the use of citizenship cards, which allowed families of Chinese workers to settle in Panama. Responding to calls from a Deputy in the National Assembly, Modesto Justiniani, in 1912, President Belisario Porras issued Executive Decree No. 2 which required all Chinese immigrants to deposit a sum of 250 balboas as a guarantee that they would leave as soon as their worker's contract expired. By 1926, Panama had banned any kind of Chinese immigration, and by 1932 had banned immigration from any non-Spanish speaking country. After the Second World War, Panama joined several other countries, including the US, and refrained from recognizing the People's Republic of China, establishing ties with the government-in-exile in Taiwan instead.[4]

The Cold War period and the 1990s

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Panama refused to acknowledge the existence of the China even in 1972, when the US and other Western allies did so, believing that Taiwanese cooperation would reap benefits. The 1977 Treaty Concerning Permanent Neutrality and Operation of the Panama Canal (the first of the Torrijos-Carter Treaties which gave Panama control over the Canal in 1999), which guaranteed neutrality in the Panama Canal was signed by all UNSC members, with the notable absence of China. This did not stop Chinese immigration into the country, which continued in the 1990s. Both countries established offices of commercial development in the others' capital city in September 1995, however, Panama continued to recognize Taiwan. In 1999, Panama gained full control over the Canal.[4]

Bilateral Relations

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Establishment of Diplomatic Relations

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While Panama had long recognized and maintained diplomatic ties with Taiwan, or the Republic of China (ROC), President Martín Torrijos had tried to normalize relations with Beijing during his tenure between 2004 and 2009. Torrijos was not very supportive of Panama-Taiwan relations, and even refused to host Taiwanese President Chen Shui-Bian during his 2005 visit of Latin America and the Caribbean. His successor, Ricardo Martinelli, also attempted to establish diplomatic ties with Beijing for economic gains in 2009, offering to cease recognition of Taiwan, but China showed no interest.[5]

The first ship to cross the newly expanded Panama Canal in 2016 was owned by a Chinese company, COSCO.[6] On June 13, 2017, Panama announced that it would no longer be recognizing Taiwan and established diplomatic ties with China. This came as a shock to the entire world, particularly the US, which has had a vested interest in the Panama Canal for decades. Expectedly, Taiwan reacted strongly, with the general secretary to the Taiwan Presidential Office, Joseph Wu, saying in 2018 that it was “unfair act, which China has made possible through intimidation diplomacy, offerings and the purchase of diplomatic allies”. The Taiwanese Ministry of Foreign Affairs accused Panamanian President Juan Carlos Varela (2014-19) of ignoring the long diplomatic relationship that had mutually economically benefitted both countries. Immediately, Taiwan withdrew from all bilateral cooperation projects with Panama and removed all diplomatic staff from the country, stating that it refused to be in competition with China over influence in the Panama Canal. Taipei also claimed that it had not seen this coming, and that in the months prior, Panama had made no indication of a termination of diplomatic recognition.[4]

In 2018, the first flight from Beijing To Panama by Air China landed in Tocumen International Airport, with a technical stop in Houston. Varela called it a milestone in Panamanian aviation. Due to this new route, the Panamanian Ministry of Tourism expected at least 40,000 Chinese tourist visits per year. As a result, Panama City was almost immediately added to China's list of officially approved tourist destinations.[7][8][9][10]

On December 2, Chinese president and general secretary of the Chinese Communist Party Xi Jinping visited Panama as part of a four-country tour, going first to Spain, then to Argentina for the G20, then to Panama and then to Portugal[11][12] before returning to China. On the same trip, Xi, the first Chinese president to be invited to Panama, signed 19 deals with Varela on trade, tourism, judicial cooperation and infrastructure. Talks began on a free trade agreement (FTA), although Panama kept its FTA with Taiwan intact. Panama also became the first Latin American country to join the Belt and Road Initiative.[13]

In 2019, newspaper La Prensa, reported that China does not allow Panama to host a Taipei Economic and Cultural Representative Office, thus preventing Panama from holding unofficial ties with Taiwan. The same was attempted by China in the Dominican Republic but was unsuccessful.[14]

Post-2020

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Hong Kong-based company CK Hutchinson won a 25 year concession from the Panamanian government in 1997 to pursue infrastructure projects and largely control in two significant ports: Balboa and Cristóbal. This contract was renewed in 2021 for another 25 years. This has greatly alarmed the US of increasing Chinese presence over the Canal - a strategically placed port for American trade - and has led them to accuse Panama of being swayed by the Chinese government, an accusation that has been dismissed by the Panamanian government.[15]

As March 2025, Panama has received $669 billion dollars of financing from China from the time diplomatic relations began.[16] On March 4, 2025, in a deal valued at $23 billion, Hutchinson sold its shares to US company BlackRock.[17] This came after US Secretary of State Marco Rubio's visit in February 2025, when Panama announced that it would not renew its Belt and Road Initiative membership upon expiration.[18]

See also

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References

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  1. ^ Haas, Benjamin (13 June 2017). "Panama cuts formal ties with Taiwan in favour of China". The Guardian. ISSN 0261-3077. Retrieved 8 March 2025.
  2. ^ Horton, Chris; Myers, Steven Lee (13 June 2017). "Panama Establishes Ties With China, Further Isolating Taiwan". The New York Times. ISSN 0362-4331. Retrieved 8 March 2025.
  3. ^ Moreno, Elida; Wen, Philip (13 June 2017). "Panama establishes ties with China, ditches Taiwan in win for Beijing". Reuters. Retrieved 7 March 2025.
  4. ^ a b c Herrera, Luis Carlos; Montenegro, Markelda; Torres–Lista, Virginia (2020). "The 'Two Chinas' and Panama: An historical review of Panamanian Relations with the People's Republic of China and Taiwan, 1903–2017" (PDF). SENACYT. ISBN 978-9962-8524-1-4.
  5. ^ "Panama, Ecuador, and China: The Dangers of Short-Term Calculations". United States Institute of Peace. Archived from the original on 5 August 2024. Retrieved 6 March 2025.
  6. ^ ". Global Affairs and Strategic Studies. School of Law". Global Affairs and Strategic Studies. Retrieved 7 March 2025.
  7. ^ "Aterriza el primer vuelo de Air China en Panamá". 5 April 2018.
  8. ^ "Air China inaugura vuelo Beijing-Houston-Panamá".
  9. ^ "Panama cuts ties with Taiwan in favour of China". BBC News. 13 June 2017. Retrieved 13 June 2017.
  10. ^ "Conoce la posible ruta y estaciones del tren Panamá-Chiriquí". 17 February 2018.
  11. ^ "Chinese President Xi arrives in Portugal to boost trade ties - Channel NewsAsia". www.channelnewsasia.com. Archived from the original on 4 December 2018.
  12. ^ "China wants to strengthen partnership with Portugal: Xi". Reuters. 2 December 2018.
  13. ^ "Panama: Beijing's Global Media Influence 2022 Country Report". Freedom House. Retrieved 7 March 2025.
  14. ^ "El Taiwan de Varela". 5 December 2019.
  15. ^ Stevenson, Alexandra; Bradsher, Keith (6 February 2025). "Trump, the Panama Canal and the Hong Kong Firm at the Heart of a Showdown". The New York Times. ISSN 0362-4331. Retrieved 7 March 2025.
  16. ^ Lee, Matthew; Zamorano, Juan (2 February 2025). "Rubio says Panama must reduce Chinese influence around the canal or face possible US action". Associated Press. Retrieved 3 February 2025.
  17. ^ "Panama president calls Trump's talk of 'reclaiming' the Panama Canal a lie". Yahoo News. 5 March 2025. Retrieved 7 March 2025.
  18. ^ "Rubio welcomes Panama's move to exit Chinese infrastructure plan as 'great step forward'". The Guardian. Reuters. 4 February 2025. ISSN 0261-3077. Retrieved 4 February 2025.
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