Panama’s BRI Exit Signals Trump Is Raising The Quanta Of Violence
The article discusses Panama’s withdrawal from China's BRI to align its economy more closely with the United States in response to President Trump's threats of 'America First' Hybrid War.
Panama capitulated commercially to the United States, following President Donald Trump’s aggressive stance and threats of a new form of hybrid war. The leader of Panama, José Raúl Mulino, has announced that the country will be withdrawing from the Belt and Road Initiative (BRI), after meeting with the US Secretary of State, Marco Rubio. According to Panama's leader, the agreement signed in 2017 under the BRI will not be extended, and they may even attempt to withdraw from the initiative sooner than expected. The article discusses Panama’s withdrawal from China's BRI to align its economy more closely with the United States in response to President Trump's threats of ‘America First’ Hybrid War.
On February 6, 2025, the US State Department announced that Panama had agreed to allow US government vessels to transit the Panama Canal without paying fees. At that moment, many believed the decision was related to the US Secretary of State Marco Rubio's visit to Panama to deliver Trump's America First ultimatum concerning President Donald Trump's complaints about the high fees charged to US government-linked vessels. However, later on the same day, the Panama Canal Authority denied the US State Department’s claim, stating that no changes had been made to the fee structure for canal transits. The authority emphasized its willingness to engage in dialogue with US officials regarding the transit of wartime vessels but did not confirm the fee exemption. So Panama might eventually have to do this as Trump had also threatened to take back control of the canal if the issues were not addressed.
This decision comes as a response to Trump’s repeated claims that Panama is violating the spirit of the 1977 treaty that transferred control of the Panama Canal from the US to Panama. Trump has accused Panama of charging exorbitant fees for the passage of American vessels through the canal, which he argues is a form of exploitation. Trump’s rhetoric has been particularly focused on what he perceives as China’s growing influence in the region. US Secretary of State Marco Rubio has warned Panama about China’s involvement in the canal area, labeling the situation as "unacceptable" and threatening to take "necessary measures" if changes are not made. Curious readers who want to understand Trumps foreign policy can check out my previous articles on the matter:
“Trump Seeks A Free Lunch From The Global Community”
“Could Trump's Annexationist Talk Be Part Of A Great US Castling Strategy?”
“Unofficial Deal Between Cuba And The US Reversed By The Trump Administration”
“Trump Recalibrates US Networked Empire Into A Tariff-Based Order”
“Trump Administration Revamps US Interference Machinery”
An Offer They Can’t Refuse
US Secretary of State Marco Rubio visited Panama to deliver critical terms to the Panamanian government about the need for Panama to reduce Chinese influence over the Panama Canal area, most probably warning them that failure to do so could lead the US to enforce what it perceives as its rights under the treaty governing the canal's neutrality. Nonetheless, while Rubio achieved the withdrawal of Panama from the Belt and Road Initiative (BRI), he was not able yet to take over the Panama Canal for the US nor did succeed in removing the Hong Kong-based company operating two of the canal’s five ports since it won the tender in 1997. But recently two Panamanian lawyers, possibly working as US proxies, have filed a lawsuit with the country’s supreme court in an attempt to axe the Hong Kong-based company’s concession to operate two ports.
Facing the possibility of being overwhelmed by these new mechanics, Panama has made the strategic decision to pivot its commercial goals. However, the shifting dynamics of US-Panamanian relations have led the country to align more closely with American interests. This alignment includes reevaluating existing trade agreements to favor US exports and investments and adjusting local regulations to attract American businesses and ensure compliance with US standards. The dynamics of Panama's commercial capitulation is as the name implies a form of economic capitulation, a smaller or less powerful country adjusts its economic policies to align with the demands of a free lunch from its vassals.
Trump's ‘America First’ Policy and Its Implications
The US and Panama have a history of trade agreements, including a Trade Promotion Agreement signed in 2007 and implemented in 2012, which reduced tariffs on a significant portion of US exports. However, Trump’s "America First" trade policy, signals a departure from previous cooperative stances, including a review of existing trade agreements and the potential imposition of new tariffs, which could have far-reaching implications for Panama’s economy.
Panama has chosen to adjust partially its economic strategies to mitigate the risks posed by Trump’s new hybrid war tactics. In exchange for avoiding potential military intervention or overwhelming economic pressure from the US, Panama has decided to alter its geoeconomic goals to align more closely with American interests. This capitulation is not without its consequences. Rubio also aimed to facilitate the acceptance of US deportation flights to the region, which is part of a broader strategy to manage immigration and enhance regional security. Critics argue that such dependence on US economic policy could stifle local innovation and entrepreneurship, as the focus shifts to serving American interests over national priorities.
If Trump's Castling strategy to reposition the US in global affairs does not gain sufficient traction, it could lead to heightened tensions and violence in disputed regions. Rapid changes in diplomatic geoeconomic relationships can destabilize established partnerships and lead to unpredictable outcomes. If not executed effectively, the Castling Strategy may elevate the quanta of violence with the Trump administration resorting to military responses in the face of the failure of his ultimatums, further exacerbating conflicts instead of resolving them.