Foreign media quoted Panamanian media reports that China COSCO Shipping Corporation has suspended its operations at Panama's Balboa Port, for unknown reasons. Industry insiders believe this is the first countermeasure taken by China after the Panamanian government forcibly took over the port assets previously owned by Hong Kong-based CK Hutchison Holdings. However, Panamanian media noted that this move will not cause a significant impact, as about 80% of the port's loading and unloading business depends on the Maersk Group.
At the end of January, Panama’s Supreme Court ruled that the concession contracts held by CK Hutchison’s companies for Balboa and Cristóbal ports were unconstitutional. The Panama Maritime Authority then took over these two ports located at each end of the Panama Canal, temporarily handing them to Maersk Group and MSC for operation, with later plans for an international tender organized by Panama. This sparked strong dissatisfaction from the Chinese side.
According to Singapore’s Lianhe Zaobao, freight forwarders working with COSCO SHIPPING have received urgent notice to immediately stop accepting all cargo bound for or transiting through Balboa Port. Cargo already in port will be transferred to either Manzanillo or Colón terminals at the Atlantic end of the Panama Canal, while containers in transit will have to wait for further notification.
An industry insider who declined to be named revealed that COSCO’s suspension of operations at Balboa Port symbolizes the loss of an important shipping client for the port, and this move is likely related to the recent dispute over port operation rights in Panama.
However, the Panamanian newspaper "La Prensa", which first reported the news, pointed out that COSCO's move is unlikely to have a major impact on operations at Balboa Port, as about 80% of the port's loading and unloading business depends on the Maersk Group.