China lashes out at US 'coercion' after Panama declines to renew infrastructure agreement

BEIJING (AP) — China on Friday lashed out at what it called U.S. “coercion” after Panama declined to renew a key infrastructure agreement with Beijing following Washington’s threat to take back the Panama Canal.

Foreign Ministry spokesperson Lin Jian said at a briefing that China “firmly opposes the U.S. smearing and undermining the Belt and Road cooperation through means of pressure and coercion.”

Assistant Foreign Minister Zhao Zhiyuan also met Panama’s ambassador to China and lodged solemn representations on Friday, the Foreign Ministry said Saturday.

The Belt and Road Initiative is President Xi Jinping’s signature foreign police drive to bind China closer to countries in the region and beyond by building roads, railways, airports, power plants and other infrastructure. The program has completed some major projects but also raised concerns about debt and environmental impact.

Panama’s decision to walk away from it was seen as a concession to the U.S. over the canal after U.S. Secretary of State Marco Rubio warned Panamanian leader José Raúl Mulino on Sunday that Panama must immediately reduce what President Donald Trump says is Chinese influence over the canal area or face potential retaliation from the United States.

Mulino has rejected pressure from the new U.S. government to discuss ownership of a waterway that is vital to global trade.

Despite that, some believe Panama may be open to a compromise under which canal operations on both sides are taken away from the Hong Kong-based Hutchison Ports company, which was given a 25-year no-bid extension to run them. An audit into the suitability of that extension is already underway and could lead to a rebidding process.

A drop in water levels in the canal due to drought has slowed transit through the canal, raising further complaints from Trump, although the delays appear to have nothing to do with China.

Lin said the Belt and Road Initiative has brought “active participation” from over 150 countries and that it has brought “fruitful results” to Panama and China, but gave no examples.

“We hope Panama will bear in mind the general picture of bilateral relationship and the long-term interests of both peoples, resist external interference, and make the right decision,” Lin said.