00:02At the port of Balboa in Panama, freight containers are stacked high as always.
00:06But this is not a normal day here at the Pacific Gateway to the Panama Canal.
00:13The Hong Kong-based company C.K. Hutchison had run this port and the Atlantic terminal of the canal since
00:19the 1990s,
00:20and it had contracts to keep operating them into the 2040s.
00:25But not anymore.
00:29Panama's Supreme Court nullified the contracts in January,
00:33ruling that they gave the company privileges and tax exemptions contrary to the country's constitution.
00:38And Panama has taken the ports back.
00:41China is fuming, and warned Panama Tuesday there will be, quote,
00:45heavy prices.
00:47In time, there may really be repercussions.
00:50C.K. Hutchison has entered into arbitration with Panama
00:53in line with the rules of the International Chamber of Commerce.
00:56But Panama's president says cancelling the contracts is in his country's national interests,
01:02and has vowed that no one company will ever get exclusive contracts to run the ports again.
01:10Under this contract, now no longer in force, the country was subjected for decades to a lack of transparency,
01:17both in terms of proper disclosure and access to sensitive and complex documentation,
01:22that during this administration was never in the hands of the Panama Maritime Authority,
01:28despite formal requests for information.
01:31The move may be in Panama's interests,
01:34but it's the United States that will be the most pleased to see the port contracts taken from a Chinese
01:38firm.
01:39The U.S. built canal is a tense point in the global U.S.-China rivalry.
01:44It carries around 5% of global sea commerce and some 40% of U.S. container traffic.
01:50When C.K. Hutchison planned to sell the ports to a group that included an American investment firm,
01:55China stepped in and shut the deal down.
01:58U.S. President Donald Trump has accused China of, quote,
02:01running the Panama Canal and threatens to take it back.
02:07Now Panama has a big task on its hands, keeping everything running without C.K. Hutchison.
02:16The importance of the mission is to be able to maintain the operation of these ports in a safe manner
02:21and ensure they continue providing the services that Panama and its ports offer together.
02:29And there's a plan for that.
02:31Panama has already announced it's giving temporary administration of the port terminals
02:35to a subsidiary of Danish group AP Möller Maersk.
02:39Their hope is to keep the ports open and secure the jobs they bring
02:43until the country decides on a new contract.
02:46Still, the legal battle may just be beginning.
02:49C.K. Hutchison has threatened to sue the Danish subsidiary.
02:52And there's also the question of what China might do,
02:55as it promises to back its businesses' interests.
02:58Fu Hua Hong and John Van Trieste for Taiwan Plus.
03:01For example,
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