Is BlackRock Running the Panama Canal Moderately Better Than the CCP?

BlackRock was bad but now it's good again? You aren't the only one confused -- or concerned about what such a move implies regarding existing national security or potential hostilities in the area.

A few years ago BlackRock was persona non grata, an enemy of MAGA, gobbling up homes and, as my friend Carol Roth outlined in her book, seemingly part of a shadowy amalgam pushing you to own nothing and demanding that you feel happy about it. Now many are cheering BlackRock’s acquisition of the Cristobal and Balboa ports bookending the Panama Canal:

A consortium of firms led by BlackRock is buying two key ports in the Panama Canal from a Hong Kong-based firm as part of a $23 billion deal after President Donald Trump expressed concern that the strategic waterway was falling under Chinese influence.

BlackRock, the world’s largest asset manager with a portfolio of investments valued at $11.5 trillion, has agreed to purchase majority stakes in ports on both sides of the Panama Canal from Hong Kong-based CK Hutchison in a multipart transaction worth $22.8 billion, the companies announced on Tuesday.

Beyond the Panama Canal ports, the deal with CK Hutchison includes 43 additional ports across 23 countries.

The optics are great: SOS Rubio unlatched Panama from China’s Belt and Road Initiative barely a month ago as one of his first efforts in his new role. A big win for the Trump admin. Now an American corporation taking control of the Panama Canal from China (specifically the Cristobal and Balboa ports). But wait — is it great? All of my BlackRock stories still pop up in my search bar when combing through my radio prep.

Stories like this:

Or:

A U.S. congressional committee on China is investigating asset management giant BlackRock (BLK.N), opens new tab and index provider MSCI (MSCI.N), opens new tab, saying they were facilitating investments into blacklisted Chinese companies, underscoring how tense relations between the two countries are rippling out into corporate America.

There is a lot more reported out there, you get the general idea. But didn’t BlackRock walk away from woke? Some conservatives argue that BlackRock’s publicly-announced move away from DEI and ESG isn’t anything to crow about:

Maybe time was of the essence? China’s presence in the area was described as being “out of control.” China also granted itself power to influence Hong Kong companies — like Hong Kong-based CK Hutchison Holdings:

While the company is a private corporation based outside the Chinese mainland, experts have told the BBC that the Chinese national security law introduced in 2020 could allow China to exercise influence over Hong Kong-based companies in the event of a conflict.

“In terms of the day-to-day, I’m sceptical as to whether there’s a direct line between Beijing and CK Hutchison, but in a time of a crisis or a conflict it would be relatively trivial for the Chinese Communist Party (CCP) to say we’re going to use the ports,” Henry Ziemer, an Americas specialist at the Center for Strategic and International Studies (CSIS), told the BBC.

More:

The canal area is part of a broader trend of Chinese investment in maritime trade routes, including in the Indian Ocean. Think of Bangladesh, Sri Lanka and Pakistan, to name a few. This foothold grants China significant influence over the Strait of Malacca, the Strait of Hormuz and other vital shipping lanes in the region. China has poured resources into Pacific ports, such as those in the Solomon Islands.

The point is that China is investing heavily in infrastructure that underpins global maritime trade. Under its national security laws, the companies driving these investments, some of which are state owned or have close ties to the Communist Party, could be compelled to use them for intelligence gathering or even military purposes. In the event of heightened strategic competition or conflict, these investments would allow for the targeted constriction of maritime trade to countries such as the US and Australia.

Was BlackRock the only entity that could run China out of the canal with dollars? That it was a priority for the admin straight out of the gate suggests an increased concern for national security and China’s plans for this crucial waterway.

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