Panama Says It Won’t Renew Belt And Road Agreement with China

Panama will not renew its memorandum of understanding with China to be a part of the Belt and Road Initiative.

Panamanian President José Raúl Mulino made the announcement on Sunday, saying that although the agreement is not due for renewal for another two years, his administration would be looking to terminate it sooner.

“We are going to study the possibility of whether it can be finished earlier or not. I think it is due for renewal in one or two years,” Mulino said.

The announcement came after a meeting with US Secretary of State Marco Rubio, during which Rubio tackled the issue of Chinese influence over the country and, in particular, the Panama Canal.

The Trump administration has accused Panama of violating the Canal’s neutrality, which was a requirement included in the 1977 “Treaty Concerning the Permanent Neutrality and Operation of the Panama Canal.” The agreement was signed as part of the handing over of the Canal to Panama, which concluded in 1999.

Rubio said the present situation is “unacceptable” and that the US will “take measures necessary to protect its rights.”

President Mulino said he “understands” the concerns of President Trump and that he would form a technical team to “clarify any doubts” about the operation of the Canal.

Panama signed the agreement to join China’s Belt and Road Initiative, a global infrastructure project, in 2017 under the administration of President Juan Carlos Varela after it cut all diplomatic ties with Taiwan.

US officials have warned the Initiative is a “debt-trap” designed to allow China control over vital infrastructure in developing nations.