Pete Hegseth Heads to Panama Amid Canal Tensions \ Newslooks \ Washington DC \ Mary Sidiqi \ Evening Edition \ Defense Secretary Pete Hegseth will visit Panama next week amid renewed tensions over alleged Chinese influence near the Panama Canal. His trip follows President Trump’s warnings and a Hong Kong firm’s agreement to transfer port control to U.S.-based BlackRock Inc.
Hegseth to Visit Panama Amid Trump Canal Concerns Quick Looks
- Defense Secretary Pete Hegseth to attend Central American Security Conference
- Visit comes after Trump accuses China of influencing Panama Canal
- Trump threatens to retake canal, calls Carter’s handover a mistake
- Panama denies China holds sway over strategic shipping route
- BlackRock set to gain control of ports near the canal
- Hong Kong firm agrees to sell its stake in key ports
- Hegseth will meet Panamanian leaders to strengthen regional ties
- Pentagon aims to bolster security partnerships in Central America
- Deal for 43 ports must still be approved by Panama
- Hegseth will also visit Eglin AFB to meet U.S. troops
Deep Look
The Panama Canal, once a proud symbol of American engineering and geopolitical dominance, is now at the center of a renewed strategic flashpoint. Defense Secretary Pete Hegseth’s scheduled visit to Panama next week arrives amid intensifying rhetoric from President Donald Trump, who has accused China of exerting undue influence over the canal and even floated the possibility of reclaiming U.S. control over the waterway.
Though officially framed around a regional security summit, Hegseth’s trip is also being closely watched as a key diplomatic signal in the administration’s broader efforts to reassert American influence in Central America, secure vital global trade routes, and curb China’s expanding economic reach through critical infrastructure projects.
A Canal Built by the U.S., Handed Over in 1999
The Panama Canal, completed by the United States in 1914, transformed global trade by providing a shortcut between the Atlantic and Pacific Oceans. For nearly a century, the canal was controlled and operated by the U.S. government, becoming a powerful symbol of American industrial might.
That changed with the 1977 Torrijos–Carter Treaties, which transferred control to Panama on December 31, 1999. At the time, the handover was hailed as a milestone in U.S.-Latin American relations. But Trump, long critical of past U.S. foreign policy, has repeatedly blasted the move, calling it a “disaster” and suggesting President Jimmy Carter “gave it away for nothing.”
Recently, Trump has gone further — accusing Panama of allowing China to exert influence over the canal, and threatening to reassert U.S. authority.
“They’re overcharging us, they’ve let China in, and now we may need to take it back,” Trump said during a campaign event earlier this year.
China’s Port Operations Under Scrutiny
Much of the concern stems from the presence of a Hong Kong-based conglomerate that held controlling interest in ports near the canal’s two key endpoints: Balboa (Pacific side) and Cristobal (Atlantic side). Although the ports are not part of the Panama Canal Authority, the firm’s proximity to the canal and Chinese ownership drew scrutiny from U.S. defense and intelligence officials.
Under pressure from the Trump administration, the Hong Kong parent company has now agreed to sell its stake to a consortium led by U.S. asset management giant BlackRock Inc.. The deal, once approved, would transfer control of 43 ports across 23 countries, including the two in Panama, to a firm with strong U.S. government ties.
BlackRock’s involvement is viewed as a strategic move by Washington to reestablish influence over maritime chokepoints that could be vulnerable in a future conflict or supply chain disruption.
Panama Pushes Back: “We Control the Canal”
Despite Trump’s claims, Panama has strongly rejected any suggestion that its sovereignty over the canal has been compromised.
“Panama exercises full control over the canal. The presence of private companies operating ports does not equate to foreign influence over our national asset,” a spokesperson for Panama’s Foreign Ministry said.
Indeed, the Panama Canal Authority is an autonomous government agency that maintains the canal’s neutrality and independence. However, geopolitical watchers argue that influence doesn’t require ownership — and proximity to the canal can still provide logistical and strategic advantages.
Hegseth’s Strategic Mission
While the Pentagon’s official line is that Hegseth’s trip is about regional security cooperation, the optics and timing say otherwise.
Sean Parnell, the Pentagon’s chief spokesman, confirmed Hegseth will attend the 2025 Central American Security Conference, but avoided direct mention of the canal.
“These meetings will drive ongoing efforts to strengthen our partnerships with Panama and other Central American nations toward our shared vision for a peaceful and secure Western Hemisphere,” Parnell said.
Sources close to the matter say Hegseth’s behind-the-scenes agenda is expected to include:
- Private discussions with Panamanian officials about the pending port transfer
- Intelligence sharing on Chinese maritime and commercial strategies in the region
- Reinforcing diplomatic channels to reassure Panama of U.S. support amid Trump’s rhetoric
- Exploring new joint infrastructure security initiatives
The Bigger Picture: Belt and Road vs. America First
China’s economic influence is not limited to Panama. Through its Belt and Road Initiative (BRI), China has financed and constructed ports, highways, railways, and digital networks throughout Latin America, Africa, and Asia. Washington sees this as a long-term strategic challenge.
While China denies any military motives, U.S. defense leaders worry that dual-use infrastructure — ports, shipping hubs, and telecom networks — could one day serve as logistical outposts for Chinese military operations.
The Trump administration, particularly under Hegseth’s defense leadership, has made countering Chinese soft power a cornerstone of its foreign policy, framing the issue as both economic and national security-related.
Military Morale and Regional Presence
After the Panama visit, Hegseth will travel to Eglin Air Force Base in Florida, home to the elite 7th Special Forces Group. His stop there is part of a broader campaign to boost morale, recognize special operations forces, and discuss the Western Hemisphere Command’s readiness posture — particularly as threats evolve from conventional warfare to cyber, economic, and information-based competition.
Looking Ahead: Diplomacy or Escalation?
While the BlackRock port deal appears to be smoothing over short-term tensions, Trump’s statements about “retaking” the canal have not gone unnoticed in Latin America. Analysts warn that such language could inflame anti-American sentiment or even destabilize bilateral ties if not walked back diplomatically.
Hegseth’s challenge next week will be to strike a careful balance: reaffirm U.S. strategic interests in Panama without appearing to undermine the country’s sovereignty.
How the administration handles this evolving issue could set the tone for U.S. engagement in Latin America throughout Trump’s term — and shape the global perception of Washington’s approach to shared infrastructure, influence, and international law.
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