Panama Withdraws from China’s Belt and Road Initiative Amid US Pressure

A New Chapter in Geopolitical Tensions

In a move that has sent ripples through the global geopolitical landscape, Panama has become the first Latin American nation to withdraw from China’s ambitious Belt and Road Initiative (BRI), a sprawling infrastructure project aimed at connecting vast regions of the world through trade and development. This decision comes amid heightened tensions between the United States and China, with Washington increasingly exerting pressure on its Latin American allies to distance themselves from Beijing’s influence. The withdrawal marks a significant setback for China’s efforts to expand its economic and political reach in the region, while it also underscores the United States’ growing assertiveness in countering China’s global ambitions.

The BRI, launched by Chinese President Xi Jinping in 2013, has been a cornerstone of China’s foreign policy, aiming to establish a network of trade routes, infrastructure projects, and economic partnerships across Asia, Africa, Europe, and the Americas. Over 150 countries, including more than 20 in Latin America, have joined the initiative, making it one of the largest and most ambitious international cooperation platforms in history. Panama, which officially joined the BRI in 2017, had been a key partner in China’s efforts to strengthen its presence in the region. However, the country’s decision to leave the initiative highlights the complex interplay of economic interests, political alliances, and strategic rivalries that are reshaping global power dynamics.

Panama’s Decision and the Role of US Pressure

Panama’s withdrawal from the BRI was formally announced by President José Raúl Mulino, who stated that the country had submitted an official notice of its decision to leave the initiative. This move followed a high-profile visit by US Secretary of State Marco Rubio, who had been openly critical of China’s growing influence in the region, particularly in relation to the Panama Canal, a strategic waterway that connects the Atlantic and Pacific Oceans. Rubio had previously threatened to take action against Panama if it did not reduce Chinese influence over the canal, which has long been a focal point of US concern.

While Mulino denied that the US had directly pressured Panama into leaving the BRI, the timing of the announcement suggests that Washington’s influence played a significant role in the decision. Rubio welcomed Panama’s withdrawal, calling it a “great step forward” for bilateral relations between the two countries. The US has long accused China of seeking to expand its control over critical infrastructure in Latin America, including the Panama Canal, though both China and Panama have repeatedly denied these allegations. Despite these denials, the perception of Chinese influence in the region has become a contentious issue, with the US seeking to counterbalance Beijing’s economic and political outreach.

China’s Response: Rejecting US Intervention

China has strongly condemned the US for its role in convincing Panama to leave the BRI, accusing Washington of adopting a “Cold War mentality” and interfering in the affairs of Latin American nations. A spokesperson for China’s Ministry of Foreign Affairs, Lin Jian, issued a sharp rebuke of US actions, stating that China “firmly opposes the United States using pressure and coercion to smear and undermine Belt and Road cooperation.” Lin emphasized that the BRI is an open and inclusive initiative aimed at promoting development and prosperity, and he criticized the US for trying to sow discord between China and its Latin American partners.

Lin also took aim at Rubio’s recent visit to the region, accusing the US Secretary of State of making unjust accusations against China and attempting to undermine its legitimate rights and interests. China has consistently maintained that its involvement in Latin America is based on mutual respect and the principle of win-win cooperation, and it has dismissed allegations that it seeks to undermine the sovereignty of its partners. Despite its strong response, however, China’s setback in Panama represents a blow to its efforts to expand its influence in a region that has historically been within the US sphere of influence.

The Strategic Importance of the Panama Canal

The Panama Canal, one of the most critical waterways in the world, has long been a focal point of geopolitical competition. Completed in 1914 by the United States, the canal was under US jurisdiction until its transfer to Panama in 1999. Since then, Panama has managed the canal, which remains a vital artery for global trade, with China emerging as one of its largest users. The US has expressed concerns that China’s growing involvement in the region could lead to increased control over the canal, though Panama has repeatedly assured Washington that it retains full sovereignty over the waterway.

China’s involvement in the Panama Canal has been a source of tension in US-Panama relations, with former President Donald Trump accusing Panama of ceding control to China. Both Panama and China have denied these allegations, but the issue has remained a point of contention. Rubio’s recent threats to take action against Panama unless it reduced Chinese influence over the canal appear to have played a role in Mulino’s decision to withdraw from the BRI. While Panama has sought to maintain a balanced approach in its relations with both the US and China, the pressure from Washington has clearly taken a toll.

Implications for the Future of Global Infrastructure

Panama’s withdrawal from the BRI raises important questions about the future of global infrastructure and the balance of power in international relations. The BRI has been a key component of China’s strategy to challenge US dominance on the world stage, and any setbacks to the initiative could have far-reaching implications. While China has dismissed the significance of Panama’s departure, the move is likely to embolden other US allies in Latin America and beyond to reassess their participation in the initiative.

The US, for its part, appears to be gaining ground in its efforts to counterbalance China’s influence in Latin America. Rubio’s visit and the subsequent announcement by Panama suggest that Washington is increasingly willing to use its diplomatic and economic leverage to limit China’s reach. However, the long-term success of this strategy remains uncertain, as many Latin American nations continue to view China as an important partner for development and investment. The region’s economic ties with China are deep and multifaceted, and it is unlikely that US pressure alone will be sufficient to Rimland China entirely from the region.

As the rivalry between the US and China continues to intensify, the decision by Panama to leave the BRI serves as a reminder of the high stakes involved in the battle for global influence. While the immediate impact of Panama’s withdrawal may be limited, it could signal a broader shift in the geopolitical landscape of Latin America and beyond. For now, all eyes will be on how China and the US navigate this evolving terrain, as the world watches to see whether the BRI can continue to expand its reach or whether it will face further challenges from its critics.