Panama has formally withdrawn from China's Belt and Road Initiative (BRI), marking a noteworthy geopolitical shift. President José Raúl Mulino's decision highlights increasing tensions between the United States and China, especially concerning the strategic Panama Canal.

Panama officially announced its withdrawal from China’s Belt and Road Initiative. President Mulino stated he instructed diplomats in Beijing to submit a 90-day notice of withdrawal from the 2017 memorandum of understanding.

Background of Panama's Involvement Panama joined the BRI in November 2017, becoming the first Latin American country to do so after establishing diplomatic relations with Beijing and cutting ties with Taiwan. The initiative aimed to improve trade and infrastructure connectivity between Asia and Latin America. Chinese companies then secured major projects, such as a fourth bridge over the Panama Canal.

U.S. Concerns The United States has voiced concerns over China's growing presence in Panama. U.S. Secretary of State Marco Rubio emphasized the risks of Chinese investments in key infrastructure projects, suggesting it could compromise the Panama Canal's neutrality. Former U.S. President Donald Trump has also questioned Panama's ties to China, even raising the possibility of the U.S. reclaiming control over the Panama Canal.

China's Reaction China has criticised the U.S. for pressuring Panama to withdraw from the BRI, arguing that their investments have positively contributed to Panama’s economy and infrastructure. A Chinese foreign ministry spokesperson, Lin Jian, expressed China's deep regret over Panama's decision and urged them to resist external interference.

Panama's Perspective President Mulino questioned the benefits Panama received from the BRI agreement. Despite U.S. concerns, Mulino denied that the United States influenced the decision to exit the BRI.

Impact and Future Implications Panama's withdrawal aligns with a broader trend where countries are reassessing their participation in the BRI due to concerns about debt dependency and political influence. This decision may also impact future Chinese investments in Latin America as other countries evaluate their strategic partnerships.

ANI