Panama Cancels CK Hutchison Canal Port Deal as Maersk and MSC Step In

Panama officially canceled the contracts that let CK Hutchison’s local unit run two major ports at the Panama Canal: Balboa (Pacific side) and Cristóbal (Atlantic side). Panama acted after its Supreme Court ruled the concessions were unconstitutional. To keep cargo moving, the government installed Maersk’s APM Terminals to run Balboa and MSC’s Terminal Investment to run Cristóbal on an interim basis.

Why It Happened and What to Expect Next

Panama says this is a temporary takeover to avoid disruptions while it prepares a new concession process, expected to be completed within about 18 months. CK Hutchison says the decree is unlawful and is considering further legal action, so the next phase is likely a mix of court and arbitration steps alongside day-to-day port operations under the interim operators.

Supply chain constraints are already costing airlines money, forcing them to keep older equipment in service longer and absorb extra maintenance and leasing expenses. The Panama ports dispute adds another layer of uncertainty at a major trade corridor, which can feed into the same “cost creep” story travel companies are trying to manage.

Why the Travel Industry Cares

These ports matter because they sit at a global trade chokepoint. If the legal fight or geopolitics creates uncertainty, shippers may build in extra buffer time or adjust routings, which can affect delivery timing and costs. That can filter into travel businesses—airline catering supply chains, hotel procurement, cruise provisioning, and airport retail—especially when inventories are tight or lead times are long.

Most Recent Update

CK Hutchison says its staff was removed and it stopped operations under Panama’s order, while Panama insists it is not expropriating the business but ensuring continuity. Earlier this month, CK Hutchison also warned of possible legal consequences if Maersk operated without its consent, signaling this dispute will likely keep escalating in legal forums even if port operations continue.

Photo by Yosi Bitran on Unsplash