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Secretary of State Marco Rubio warned China that “the sovereignty of our hemisphere is non-negotiable” after the U.S. and regional allies accused Beijing of detaining Panama-flagged ships in a dispute tied to canal port control.
In a joint statement with Bolivia, Costa Rica, Guyana, Paraguay and Trinidad and Tobago, the U.S. said China’s actions targeting Panama-flagged vessels were a “blatant attempt to politicize maritime trade” and infringe on regional sovereignty, framing the dispute as a broader strategic test over control of one of the world’s most critical commercial arteries.
While the Panama dispute centers on shipping detentions rather than a physical blockade, critics increasingly view it alongside battles over other strategic choke points, such as the Strait of Hormuz, as part of a widening contest over whether Beijing or Washington will shape the rules governing global trade and energy corridors.
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Containers and cranes at the Port of Balboa at the Pacific entrance of the Panama Canal in Panama City, Panama, Feb. 25, 2025.
The confrontation follows Panama’s Supreme Court decision earlier in 2026 to invalidate the legal framework behind Hong Kong-based CK Hutchison’s long-held control of the Balboa and Cristobal terminals flanking the Panama Canal, a choke point that handles roughly 5% of global maritime trade.
U.S. regulators have monitored nearly 70 Panama-flagged vessels detained by Chinese authorities since March 8, according to Reuters — a surge American officials say appears designed to retaliate against Panama and pressure global shipping.
“China has used Iran to destabilize the Middle East. In effect, Iran has been China’s proxy,” China expert Gordon Chang told Fox News Digital, arguing Beijing’s actions in Panama fit a broader global pattern in which China uses economic leverage, trade pressure and regional partners to expand influence while condemning similar tactics from Washington.
Chang said Beijing is now facing growing resistance as the U.S. increasingly moves not only against China directly, but also against governments and geopolitical flash points he argues have strengthened Beijing’s hand.
“Trump apparently decided that he would counter this sly tactic by taking China’s proxies — Venezuela, Cuba and Iran — off the board,” Chang said.
An aerial view shows the port of Rodman in Panama City Jan. 30, 2026. (Martin Bernetti/AFP)
He also framed pressure on Iran and threats to the Strait of Hormuz as part of a larger strategic effort aimed at both Tehran and Beijing.
“Closing the Strait of Hormuz is a two-fer, starving Iran’s regime and shaking China’s already fragile economy,” Chang said. “Trump is using energy to reorder the world.”
Chang also accused Beijing of hypocrisy over trade.
“China’s Communists invented hypocrisy. Nobody does hypocrisy better than the Chinese Communists,” he said, arguing that China long benefited from a global trading system it increasingly weaponized for geopolitical purposes.
“The elemental truth is that China started this cycle of action and retaliation,” Chang said. “If China had not threatened America, America would not have leaned on Panama. If America had not leaned on Panama, China would not have detained Panamanian vessels.”
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Two cargo ships enter the Miraflores Locks of the Panama Canal in Panama City on Jan. 22. (Martin Bernetti/AFP)
China has rejected accusations that it is politicizing trade, with its foreign ministry arguing U.S. criticism reflects Washington’s own strategic ambitions around the canal.
China’s Foreign Ministry called the statement on Wednesday “entirely baseless and misleading”, said it would take steps to safeguard China’s interests in Panama, and accused the United States of politicizing ports, according to Reuters.
“China also urges the relevant countries not to be deceived or exploited by malevolent forces,” added Lin Jian, a Foreign Ministry spokesperson.
Fox News Digital reached out to the Chinese Embassy in Washington, D.C., for comment but did not receive a response in time for publication.
Reuters contributed to this article.
