US President Donald Trump made the threat earlier this year, alleging that China controls the strategic waterway because Hong Kong-based CK Hutchison Holdings operates existing ports at either end – Cristobal on the Atlantic and Balboa on the Pacific.

The firm agreed in March to transfer control of both ports to a conglomerate led by US-based BlackRock, but the deal – viewed with suspicion by China – has not been finalised.

The Central American country is hoping to attract US$8.5 billion in investment over the next decade to expand port capacity and to build a gas pipeline and a new reservoir, among other projects.

In addition to new ports, the project envisions the construction of a gas pipeline and a new reservoir.

“We have to be open to participation of all interested parties,” and solicit “the broadest possible competition,” canal administrator Ricaurte Vasquez told journalists. He said all parties would bid on an equal footing.

He declined to speculate about a possible increase in tensions with the US if the projects were awarded to Chinese firms in the future.

The Panama Canal Authority, which has begun meeting with interested parties ahead of the bidding process, plans to award contracts for the two terminals in late 2026 and begin operations in 2029.

Hong Kong’s Cosco Shipping Ports and Orient Overseas Container Line (OOCL) are among the international players that have expressed interest – along with Singapore’s PSA International, Taiwan’s Evergreen, German Hapag Lloyd, Denmark’s Maersk and France’s CMA Terminals.

Panama’s five main ports are all located near the canal and are operated by concessionaires from the US, Hong Kong, Taiwan and Singapore.

The 80km canal is used mainly by the US and China and carries 5% of the world’s maritime trade.

The US built and operated the Panama Canal for a century before handing control to Panama on the last day of 1999.