Hong Kong’s richest tycoon
Nicknamed “Superman,” Li is among the world’s 50 richest people, with Forbes calculating his net worth at $38 billion. Li, 96, retired from his position as chairman of CK Hutchison in 2018, succeeded by his elder son Victor. But he’s still one of Hong Kong’s most influential figures.
HONG KONG (AP) — Hong Kong tycoon Li Ka-shing’s business empire is in the crosshairs after CK Hutchison Holdings chose to sell its Panama Canal port assets to a consortium that includes U.S. investment firm BlackRock Inc., apparently angering Beijing.
Over the past week, Beijing’s Hong Kong affairs offices have posted scathing commentaries from a local state-backed media outlet over the tentative deal by Hutchison, which is controlled by Li’s family.
That raises questions about the deal and highlights the difficulties Hong Kong businesses face as they balance demands from Beijing for national loyalty and their own capitalist interests in the once free-wheeling Asian financial hub. Here’s what to know about the issue.
Panama ports deal
CK Hutchison announced March 4 that it would sell all its shares in Hutchison Port Holdings and in Hutchison Port Group Holdings to the consortium that also includes BlackRock subsidiary Global Infrastructure Partners and Terminal Investment Limited, which is chaired by Italian shipping scion Diego Aponte, whose family reportedly has a longstanding relationship with Li’s.
- If approved, the deal, valued at nearly $23 billion including $5 billion in debt, will give the consortium control over 43 ports in 23 countries, including the ports of Balboa and Cristobal, located at either end of the canal.
- The transaction does not include ports in Hong Kong or mainland China. CK Hutchison said the transaction was purely commercial in nature.
- One of the Beijing-backed newspaper commentaries described the deal as a betrayal of all Chinese and said the company should think about which side to take.
- The other said great entrepreneurs are patriots, suggesting that businesspeople who “dance with” predatory American politicians would be doomed to infamy.
Chief Executive John Lee avoided direct criticism of the deal or Trump, but told reporters on Tuesday his government opposes bullying tactics in international economic and trade relations, reiterating Beijing’s stance.. .
CK Hutchison has not commented on the controversy.
China Is Unhappy With BlackRock's Panama Ports Deal
- Victor Li did not mention the deal in his chairman’s statement but said the operating environment for the group’s business is expected to be volatile and unpredictable.
- He said he anticipated potential headwinds for the company’s ports and related services in early 2025 as shipping lines transition into their new alliances and ongoing geopolitical risk impacts global trade.
Longer term implications
The first Trump administration sanctioned Chinese and Hong Kong officials for undermining the autonomy of the territory promised when Britain handed its colony to Beijing in 1997 under a concept dubbed “One country, two systems.” It promised the city could keep its Western-style civil liberties and economic autonomy for at least 50 years, but following the 2019 protests, Beijing has doubled-down on its political control of the city.
Li could try to placate critics who deem him insufficiently patriotic, Chan said, by using proceeds from selling the port assets for investments aligned with Beijing’s policies, particularly in developing Hong Kong and mainland port businesses.
But relations between private businesses and Beijing remain uncertain, said The Asia Group’s Chen. Even though Chinese President Xi Jinping recently met with private sector business leaders in a show of support, some may wonder if they must follow the party line even if that might conflict with their business interests, he said.
If Beijing steps up pressure on Li to scrap the deal, the Trump administration could hit back with more sanctions and restrictions on Hong Kong and Chinese businesses and some individuals, he said.
The situation shows that Washington’s concerns about Hong Kong’s business autonomy are valid, Chen said.
“This is bad when it comes to the defense of ‘one country, two systems,’” Chen said.
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- Though the two ports sit at opposite ends of the Panama Canal, ships do not have to pass
- through them to enter.
- Other ports along the canal are operated by companies from Taiwan, Singapore and the U.S.
- The ports serve mainly to handle cargo, while the canal itself is run by the Panama Canal Authority,
- an independent Panamanian government agency.
- Though CK Hutchison is a private company based in Hong Kong, a semiautonomous Chinese territory,
- Trump administration officials had argued that it was subject to control by Beijing, which has been
- its grip on the city.
Trump says U.S. is 'reclaiming' Panama Canal after American and Swiss investors strike deal to buy Chinese-backed ports
President Donald Trump, who had claimed without evidence that China controls the canal, touted the proposed sale as a victory
in his address to a joint session of Congress.
President Donald Trump had argued that the Chinese-backed ports, one each at the canal’s Pacific and Atlantic entrances,
“My administration will be reclaiming the Panama Canal, and we’ve already started doing it,” he said.
- Nearly 15,000 ships from around the world transit each year through the Panama Canal, which was
- built primarily
- U.S. funds and was completed in 1914. About two-thirds of them are headed to or from the U.S.
In 1999, the U.S. relinquished control of the canal to Panama under a treaty negotiated by President Jimmy Carter and
ratified by the Senate in 1978, with the U.S. retaining the permanent right to defend the canal against any threat
its neutrality.
- Trump has claimed without evidence that China controls the Panama Canal.
- He said he would consider using military force to seize it back from Panama, one of Washington’s closest allies in Latin America.
Both China and Panama deny there is any foreign interference in the 50-mile canal, whose neutrality is enshrined
in Panama’s Constitution.
“China supports Panama’s sovereignty over the canal and is committed to maintaining its status as a permanently
neutral international waterway,”
Chinese Foreign Ministry spokesperson Lin Jian said at a regular briefing in Beijing on Wednesday.
“China has never been involved in the management or operation of the canal, nor has it interfered in its affairs,” he said.
The Trump administration and members of Congress were briefed on the proposed $22.8 billion deal, a person familiar
with the matter told NBC News.
The consortium, which also includes the Geneva-based Mediterranean Shipping Company, would gain control of an
80% interest in CK Hutchison subsidiary
Hutchison Ports, which operates 43 ports in 23 countries. It would also receive 90% of Panama Ports, which operates
the Balboa port on the Pacific side of the canal and the Cristóbal port on the Atlantic side.
It does not affect the company’s ports in China.
“I would like to stress that the transaction is purely commercial in nature and wholly unrelated to
recent political news reports concerning the Panama Ports,”
----- Frank Sixt, co-managing director of CK Hutchison, said in a news release.
0:00 Goals of US foreign policy
1:08 BlackRock buys Panama Canal ports
2:08 (CLIP) Trump threatens Panama Canal
2:32 BlackRock 3:26 US empire fears China
4:03 (CLIP) Marco Rubio on China "threat"
4:46 CIA targets China 5:42 (CLIP) CIA director on China
6:34 CIA threats 6:50 Trump attacks China
7:06 (CLIP) Trump on Panama Canal
7:17 BlackRock takeover
7:43 Colonial Monroe Doctrine
8:40 Greenland
9:27 Marco Rubio
11:09 (CLIP) Rubio on US "backyard"
11:46 (CLIP) Rubio fears China
12:24 (CLIP) Rubio on Taiwan
12:56 New cold war 13:39 Panama Canal geopolitics
14:59 BlackRock buys ports around world
15:54 Biden's infrastructure scheme
16:09 Belt and Road Initiative
16:33 Partnership for Global Infrastructure
17:53 BlackRock, Microsoft, and AI
18:06 Stargate Project with OpenAI
18:26 USA is an oligarchy
19:39 G7 summit starred BlackRock
20:16 (CLIP) CEO Larry Fink at G7
21:11 BlackRock backs both US parties
22:15 Asset managers manage $128 trillion
23:06 Blackstone: Largest US landlord
24:33 USA: best "democracy" money can buy
25:13 Blackstone CEO Stephen Schwarzman
26:45 Elon Musk: biggest US donor
27:51 Trump's trickle-down economics
31:37 Class war
33:24 Trump's Russia strategy
33:51 Outro || Geopolitical Economy Report ||
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