Panama Canal 'vulnerable' to Chinese aggression that U.S. could preempt, law scholar tells Senators

An international law scholar told a Senate panel Tuesday that the U.S. doesn’t need to wait for a hostile act by China or another nation at the Panama Canal to protect America’s interests in the crucial shipping channel.

Eugene Kontorovich, a professor at George Mason University’s Scalia Law School, said the U.S. treaty with Panama dating from the 1970s came with a list of “understandings” that stipulated the U.S. can “defend the canal against any threat to the regime of neutrality.”

“That’s why the treaty specifically says that we can act, not just to end actual obstructions to the canal,” Mr. Kontorovich told senators. “We don’t have to wait until the canal is closed by hostile military action. That would be a suicide pact that would be catastrophic for us.” 

The Senate Commerce, Science and Transportation Committee’s hearing focused on the influence of the Chinese government over the canal, and whether Hong Kong-controlled ports at either end of the canal pose an economic or national security threat to the U.S. and other nations using the shipping passage. 

The hearing came amid President Trump’s push to regain control of the waterway and his accusations that China controls the Panama Canal, a charge that Panamanian and Chinese officials have denied. 

Mr. Trump hasn’t ruled out the potential use of military force to regain control of the canal. 

Witnesses at the Senate hearing argued that ultimately the control of the canal falls under the autonomous Panama Canal Authority, which governs shipping activities through the causeway and enforces the neutrality of the treaty agreed to by the U.S. and Panamanian governments in the late 1970s. 

Still, much of the focus fell on Hutchison Ports, a Hong Kong-based shipping company that operates ports on both ends of the canal — Balboa on the Pacific side and Cristobal on the Atlantic side. 

Sen. Dan Sullivan, Alaska Republican, questioned whether the relationship between Hutchinson Ports and the Chinese government posed a direct threat to shipping through the canal, and whether that relationship would violate the treaty. 

“[The Chinese government] could go to these two companies saying, ‘Hey, shut it down, make it hard, sink a ship in the canal,’” Mr. Sullivan said. “And wouldn’t they be obligated to do that under Chinese law if they were ordered to by the PLA or the CCP?”

Mr. Kontorovich countered that he was unsure if the company would be obligated to follow that kind of order, but that Beijing does have “many tools of leverage and pressure on these companies.” 

Sen. Tim Sheehy, Montana Republican, asked witnesses “how fast” China could shutter usage of the canal and gave the example of the Ever Given, the container ship that in 2021 blocked the Suez Canal for six days and caused significant delays in shipping across the globe. In that case, the ship ran aground in high winds.

Federal Maritime Commissioner Daniel Maffei said that while China could “probably do a similar thing,” it would be considered an act of terrorism. Most of the panel’s discussion was centered on the economic threats that China posed with its influence over the waterway through operation of the ports and through Panama’s involvement with the Belt and Road Initiative. 

“It’s not hard to close off a waterway,” Mr. Maffei said. “The Panama Canal is actually quite vulnerable in terms of infrastructure. It’s not, you know, this is not a fort or militarily reinforced location … Why would they bother with a military-like operation when they can get what they want with non-military means?”

Senate Commerce Committee Chair Ted Cruz, Texas Republican, touched on Mr. Trump’s concerns of China’s involvement in the region, and how over time, the treaty negotiated by then-President Carter and the Panamanian government has been taken advantage of.

While much of the focus was on whether Panama and its work with China was in violation of the treaty between the U.S. and Panamanian government, Sen. Amy Klobuchar questioned why Mr. Trump’s order to freeze federal grant funding was not being discussed. 

A memo from Mr. Trump’s acting Office of Management and Budget director ordered all federal agencies to temporarily pause the disbursement of “all federal financial assistance” besides Social Security and Medicare. The order was slated to go into effect Tuesday night. 

“Freezing all federal funding already granted to improve port and freight infrastructure through the port infrastructure program, seems to me a major problem we should be addressing if we’re talking about America’s shipping interests,” said Ms. Klobuchar, Minnesota Democrat.