By Elida Moreno
Panama City (Reuters), Panama’s control service, will bring a case against employees who authorize the renewal of a 25 -year port concession of a company led by CK Hutchison, Monday General said on Monday, as a key audit is expected to be completed soon.
The Panama Ports Company contract for Balboa and Cristobal ports near the Panama Canal, in which Hong Kong -based CK Hutchison has a 90% share, was renewed in 2021.
The Panama Government launched an audit in January, and in March a group led by the US Blackrock investment company announced a deal to buy CK Hutchison’s majority stake in a $ 22.8 billion global port department, including the two ports in Panama, which is not yet final.
So far, the audit has determined that Panama “has left $ 1.3 billion on the table,” General Anel Flores told reporters at a press conference, citing tax incentives and benefits provided by the government in the contract.
In February, the Prosecutor General of Panama released a binding opinion, finding that the port contract was unconstitutional. The Supreme Court will have the last word for it.
Once completed, the results of the audit will be presented to the maritime power of Panama, which runs the ports, Flores said.
The audit is seen as a possible obstacle in the Blackrock proposal for CK Hutchison’s port business, which is criticized by China. If the Panama General Controller confirms the irregularities in the renewal of the concession or the Supreme Court announces the unconstitutional treaty, the concession may be overturned, lawyers and experts said.
Hutchison’s shares in Hong Kong dropped by 2.6% on Tuesday, lower than 1.5% profit in the basic Hang Seng index.
A conglomerate of telecommunications to the trade owned by Hong Kong Li Ca-Shing is caught in the Chinese cross group in a highly politicized deal and the company did not sign a contract last week as intended to sell its two operations in Panama as part of a wider deal as a result.
The Chinese market regulator said it would perform an antitrust review of the port deal in Panama, and Hong Kong leader John Lee on Tuesday repeated comments on the deal, which must comply with local laws and regulations.
Asked if a Panama port deal would be a solution, Blackrock CEO Larry Fink told New York Economic Club on Monday that the ports in question represent about 4% of the total value of the entire deal, which would give the US company to 43 ports in 23 countries and “it will be reviewed.
Fink said the anti -competition regulatory examination could take nine months and it was optimistic that the transaction would be approved.
However, he acknowledged that China may stop the deal from being one of the main users of the ports and one of the 50 jurisdictions that will review the transaction.
US President Donald Trump, who has threatened to take control of the Panama Canal due to the presence of Chinese and Hong Kong companies in the central American maritime business, welcomes the Blackrock port deal.
Fink stressed that the purchase was conditioned by commercial interest rather than geopolitical reasons, adding that he discussed the transaction with US politicians after talking to CK Hutchison became exceptional.
“Everything was done in the right order, it was not done politically, despite all the stories that was made,” he said.
(Report from Elida Moreno; additional reporting by Tatiana Bauzer in New York, writing by Mariana Paraga and Claire Jim; Editing by Leslie Adler, Stephen Coates and Louise Heven)