China angered by ruling voiding Panama Canal port contract, warns of a "price to pay"

[Financial News] The Government of the People's Republic of China has condemned a Supreme Court of Panama ruling that invalidated Hong Kong-based CK Hutchison Holdings' operating rights for ports on the Panama Canal, calling it an act of submission to US hegemony and warning that there will be a heavy price to pay.
On the 3rd (local time), the Hong Kong and Macao Affairs Office of the State Council of China said on social media that the decision by Panamanian authorities and CK Hutchison to deem the contract for operating the Cristóbal and Balboa ports within the canal "unconstitutional" amounted to bowing to US hegemony, and issued a warning.
The office stated, "This incident can be described as a self-inflicted collapse of national credibility. It is like striking your own foot with an axe," adding, "They have submitted to hegemony and acted as henchmen for bad actors. It is shameful and tragic."
It went on to criticize the move as "the Panamanian authorities completely kneeling to and flattering hegemony."
José Raúl Mulino, the pro-US President of Panama, announced in February last year that Panama was withdrawing from China's Belt and Road Initiative (BRI), a land and maritime Silk Road project linking China, Central Asia, and Europe.
The office also took aim at the United States, saying, "Some country adheres to a hegemonic logic of 'might makes right,' repeatedly using 'national security' and 'geopolitical strategy' as a pretext to force other countries to obey its will and to pressure them into cracking down on third-country companies."
It warned, "If they stubbornly insist on having their own way and fail to recognize their mistakes, they will pay a heavy price, both politically and economically."
An audit by the Panamanian government found that since CK Hutchison Holdings took over operations in the late 1990s, government tax revenues have fallen by more than 1.3 billion dollars.
The Office of the Comptroller General of Panama and a group of lawyers filed a lawsuit with the Supreme Court, arguing that Hutchison had violated the interests of the Panamanian government and its taxpayers.
While Chinese investment in LATAM has been increasing, the United States has long been the largest investor in Panama and its biggest trading partner.
The US dollar is widely used in Panama, which has no central bank, leaving the country potentially vulnerable to US pressure.
Following the Supreme Court of Panama's ruling, some analysts said it amounted to a victory for the Trump administration, which adopted a National Security Strategy (NSS) that places strong emphasis on the Western Hemisphere.
After the arrest of Venezuelan President Nicolás Maduro, Donald Trump went on to signal his intention to extend US dominance as far as Greenland and Canada.
In January last year, shortly after taking office, he declared that the United States would reclaim control over the Panama Canal, saying, "Even though we did not give it to China, the Panama Canal has come under Chinese influence."
jjyoon@fnnews.com Yoon Jae-joon Reporter