Another blow to China, this small country took action after Trump's threat; What will the dragon do now?

China's tension is increasing as Donald Trump becomes the President. America has decided to impose a 10 percent tariff on imports from China. At the same time, Panama has given a big blow to China. Panama's President Jose Raul Mulino said that his country will not renew China's ambitious plan, Belt and Road (BRI) .

Panama joined this scheme in 2017. Panama does not want to join this scheme of China now. Let us tell you that President Trump has been pressurizing Panama for the last few months. Trump says that Chinese ships passing through the Panama Canal are not taxed as much as American ships are being taxed.

Panama ports to be audited

President Mulino said Panama will now work closely with the US on new investments, including infrastructure projects. The president said his government will audit the Panama Ports Company.

US Secretary of State meets with Panama's President

Panama took this decision after US Secretary of State Marco Rubio met Panamanian President Jose Raul Mulino on Sunday.

Speaking on Trump’s behalf, Rubio told Mulino that Trump believes China’s presence in the canal zone could violate the treaty that led the U.S. to turn the waterway over to Panama in 1999. That treaty calls for the permanent neutrality of the American-built canal.

China's influence should be reduced: America

US Secretary of State Marco Rubio has warned Panama that it must make "urgent changes" to reduce China's "influence and control" over the Panama Canal.

Rubio, who arrived in Panama on Sunday, February 2, said Panama should take action or else the US would take steps to protect its rights. Mulino said he has proposed technical-level talks with the US to address Trump's concerns about Chinese influence.

How important is the Panama Canal?

The Panama Canal is an 82 kilometer (51 mile) long waterway that connects the Atlantic Ocean to the Pacific Ocean. The Panama Canal shortcut greatly reduces travel time for ships between the Atlantic and Pacific Oceans.

History of the Panama Canal 

Colombia, France and America started the construction work in the area around this canal. France started work on the canal in 1881. However, later the investors had to face a lot of problems. After this, France stopped the work in 1889.

Then in the year 1904, America started working on this project. After this, America opened the canal in 1914. At the same time, America handed over the control of the route to Panama in 1999. Fares are charged from the ships passing through this canal. This canal is very important for the economy of Panama.

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