Panamanian President Jose Raul Mulino said on Thursday that the concession of contracts to operate two ports held and operated for nearly three decades by Hong Kong's CK Hutchison Holdings will "never again" be issued to a single company.
Panama's Supreme Court last week nullified CK Hutchison's contract to operate two ports along its strategic canal through its Panama Ports Company subsidiary, ruling that the contracts violated the Central American nation's constitution by giving the company exclusive privileges and tax exemptions.
"I don't expect this situation to escalate," Mulino said, calling the court's decision definitive. "Panama is a dignified country and will not allow itself to be threatened by any country on earth."
On Tuesday, China warned Panama there would be "heavy prices" to pay for the court ruling which China's Hong Kong and Macau Affairs Office called "absurd" and "shameful and pathetic." They vowed to defend the interests of Chinese companies.
Mulino added that it was unclear when the ruling would be enforced. In the meantime, the Panama Ports Company would continue to operate both ports, he said.
"The Panamanian state decides on the concession scheme to be granted much later," he added.
On Wednesday, CK Hutchison said its Panama Ports Company unit had started international arbitration proceedings against Panama, in a case that could take years to resolve.
The decision and move to seek arbitration cast further doubt on the future ownership of the two ports and the company's planned $23 billion deal to sell its port businesses.
(Reuters)