China’s state-owned shipping giant COSCO Shipping has suspended operations at Balboa Port, located at the Pacific entrance of the Panama Canal, according to a notice to clients reported by the Panamanian newspaper La Prensa.
The suspension comes amid ongoing legal and geopolitical tensions surrounding the operation of key ports linked to the canal. In the notice, COSCO instructed customers to return empty containers to the Manzanillo International Terminal or the Colon Container Terminal, both located in Panama’s Colón province.
The company did not provide a reason for halting operations or clarify whether the suspension is temporary or permanent. COSCO also did not immediately respond to requests for comment from Reuters.
Court Ruling Triggers Operational Changes
The move follows a late-January ruling by the Supreme Court of Panama that annulled the concession contract held by a subsidiary of Hong Kong-based conglomerate CK Hutchison to operate Balboa port.
Following the ruling, APM Terminals, the terminal operating arm of Maersk, stepped in to temporarily manage the port for a period of up to 18 months.
Balboa and its Atlantic counterpart Cristobal have been at the centre of a year-long geopolitical and commercial dispute involving the United States, China and the Panamanian government.
Global Port Sale Draws Political Scrutiny
In March 2025, CK Hutchison announced plans to sell 43 ports across 23 countries—including Balboa and Cristobal—to a consortium led by investment giant BlackRock and Mediterranean shipping major Mediterranean Shipping Company (MSC), controlled by the family of Italian shipping magnate Gianluigi Aponte.
The proposed transaction quickly became entangled in broader US–China geopolitical tensions. The deal received support from Washington but drew criticism from Beijing, particularly as the dispute coincided with calls by former US President Donald Trump for greater US control over the strategically vital Panama Canal.
Amid scrutiny from Chinese authorities, CK Hutchison said in July it was discussing the inclusion of a Chinese “major strategic investor” in the consortium bid. Sources later identified COSCO as a potential participant.
Beijing Engages Major Shipping Lines
Adding another dimension to the unfolding situation, China’s state planning authority held meetings this week with executives from Maersk and Mediterranean Shipping Company, according to an official statement. The agency did not disclose the purpose of the discussions.
The suspension of COSCO’s activities at Balboa could add further uncertainty to port operations at one of the world’s most important maritime chokepoints, through which roughly 5% of global seaborne trade transits annually.
