HK chief: Panama ports deal should comply with law

Hong Kong Special Administrative Region Chief Executive John Lee Ka-chiu said on Tuesday that public concerns about city conglomerate CK Hutchison Holdings' proposed sale of its Panama Canal ports to a United States consortium deserve attention, and expressed firm opposition to any form of coercion or pressure tactics in international trade deals.

Political and business heavyweights in Hong Kong cautioned that the decision may pose risks to China's national interests and the landscape of multilateral trade. It could also undermine the group's long-term development.

CK Hutchison Holdings — founded by Hong Kong tycoon Li Ka-shing — said on March 4 that it had struck a $22.8 billion deal to sell its majority stakes in two Panama Canal ports, as well as 41 others in 23 countries, to a consortium led by US investment company BlackRock. The announcement has ignited widespread discussions amid the uncertain global trade market.

Ahead of an Executive Council meeting, Lee was asked about how businesses operating globally and closely intertwined with Hong Kong's economy should navigate political risks.

He said that widespread public discussions about the issue reflect societal concerns, underscoring its significance.

The chief executive said that the SAR government calls on foreign governments to provide a fair and equitable business environment for all companies, including those from Hong Kong. He firmly condemned the use of coercion or pressure in international economic and trade activities, emphasizing that any transaction must comply with legal and regulatory requirements.

The SAR government will handle the matter in accordance with the law and regulations, Lee added.

Leung Chun-ying, vice-chairman of the National Committee of the Chinese People's Political Consultative Conference and former chief executive of the SAR, said on social media that some businessmen mistakenly believe in the notion that "business knows no borders" and assume that everything is purely business.

However, businessmen without a motherland will only face bullying, Leung said, emphasizing that businessmen should also prioritize their country.

Lau Siu-kai, a consultant with the Chinese Association of Hong Kong and Macao Studies, a Beijing-based think tank, said that from a business perspective, this deal indeed brings substantial profits to CK Hutchison Holdings and shields the group from potential US pressure on its global ports and infrastructure.

However, this transaction inevitably poses threats to China's national interests and security, as the US could intensify actions against China's shipbuilding and shipping industries as well as the China-proposed Belt and Road Initiative, Lau said.

He called for the company to fully and seriously consider the complexity of the international landscape and China's national interests before making business decisions, stressing that pivotal infrastructure plays a highly crucial role in international competition.

Erik Yim-kong, a Hong Kong lawmaker and vice-chairman of China Merchants Port Group, said that the sale by CK Hutchison Holdings could potentially squeeze the country's legitimate space for expanding its international trade and logistics industry and may affect multilateral trade, as well as the company's long-term development.

He emphasized that port management concerns significant national interests. He noted that the sale involves multiple ports located in countries and regions involved in the BRI, and that a quarter of China's import and export goods pass through the Panama Canal.

He warned that US control over the canal would grant access to precise data on China's trade, facilitating targeted actions against China's manufacturing sector.

CK Hutchison Holdings and CK Asset Holdings will hold board meetings on Thursday to deliberate on last year's business performance. The companies said on Tuesday that they would not hold a news conference and analyst meeting on the annual results as they usually do.