• President Trump threatens action over alleged Chinese control of Panama Canal, suggesting "something very powerful" will happen.
  • Secretary Rubio warns Panama to end Chinese influence, particularly concerning port operations by Hong Kong-based companies.
  • Panama's President Mulino offers dialogue and a potential review of Chinese contracts while rejecting claims of direct canal control.

President Donald Trump has escalated tensions with Panama with threats to regain control of the Panama Canal, citing concerns over Chinese influence on the strategic waterway.

The newly sworn-in president claimed on Sunday that "something very powerful is going to happen soon," marking one of his first major foreign policy statements since returning to the White House.

Trump asserted that while the canal "was not given to China," there had been violations of existing agreements, suggesting potential US intervention.

"China's running the Panama Canal... we're going to take it back or something very powerful is going to happen," Trump told reporters, though he indicated military action might not be necessary.

The situation intensified as US Secretary of State Marco Rubio, during his first overseas trip in the role, warned Panama's President Jose Raul Mulino that Washington would "take measures necessary" if Panama failed to address concerns about Chinese influence.

A key point of conflict is the 25-year concession granted to Hong Kong-based CK Hutchison Holdings for operating ports at both ends of the canal, renewed in 2021.

President Mulino has responded diplomatically, describing his meeting with Rubio as "respectful and cordial."

He expressed willingness to review certain Chinese business interests in Panama, including the controversial port operations contract, pending an audit.

However, Panama's government maintains that these port operations are separate from the canal's core operations, which remain under the autonomous Panama Canal Authority's oversight.

The historic waterway, which Trump called a modern "wonder of the world," was built by the United States and opened in 1914, claiming thousands of workers' lives during its construction.

The US transferred control to Panama in 1999 under President Jimmy Carter's administration.

In a significant development, Mulino announced that Panama would not renew its broader agreement with China's Belt and Road Initiative, which had previously facilitated increased Chinese investment in the country.

This decision appears to be a conciliatory gesture toward US concerns while maintaining Panama's sovereignty over the canal's operations.

Edited By Annette George