CK Hutchison Says It Exceeded Panama Port Deal Commitments With $1.7B Investment

CK Hutchison, a Hong-Kong-based company, has stated that it has invested $1.7 billion in two ports located near the Panama Canal, more than what was required under its contract.

The company released this statement on April 9, 2025, while the Panamanian government continues to audit the deal.

Panama Ports Company (PPC), which operates the Balboa and Cristobal ports, is 90% owned by CK Hutchison.

The company’s 25-year operating license for these ports was renewed in 2021. However, the Panamanian authorities began a detailed audit of the agreement in January this year.

The Comptroller General of Panama, Anel Flores, recently reported that the ongoing audit found Panama may have missed out on approximately $1.3 billion in revenue.

This was attributed to the tax reliefs and other benefits given to CK Hutchison under the terms of the concession.

Despite the concerns, CK Hutchison has stated there has been no wrongdoing from its side. Rather, the company claimed that it went well beyond its contractual investment commitments.

According to the company, the original concession deal signed in 1997 only required a $50 million investment, and a later update in 2005 raised the commitment to $1 billion.

It said that both these targets have been exceeded with its total investment now reaching $1.7 billion.

The company also said that PPC paid the Panamanian government $668 million during the concession. It stated this amount is higher than what any other port operator in the country has contributed.

In its response, CK Hutchison also clarified that the tax exemptions given to PPC were not unusual, but were the same benefits provided to other port operators in Panama.

PPC has urged the Panamanian government to maintain respectful cooperation and communication regarding the ongoing investigation, stating its interest in protecting the port concession.

This situation has drawn more attention because of a separate $22.8 billion deal led by US-based investment firm BlackRock.
The agreement includes plans to acquire most of CK Hutchison’s worldwide port business, including the Panama ports.

The audit and political implications could make the deal more complicated.

Since returning to office, US President Donald Trump has spoken against the presence of Chinese and Hong Kong-based companies in Panama’s maritime operations.

He even threatened to take control of the Panama Canal and supported the BlackRock-led deal.

Meanwhile, Chinese officials are investigating the same BlackRock deal for possible antitrust violations.

According to Flores, the Panama audit is about to be completed. Since February, the country’s Supreme Court and the attorney general’s office have also launched separate reviews of the concession and its renewal process.

Reference: Reuters

Source: Maritime Shipping News