China’s influence on Panama Canal poses ‘acute risks to US national security,’ Sen. Cruz warns

China’s influence on the Panama Canal poses “acute risks to U.S. national security,” Sen. Ted Cruz is warning Tuesday, alleging the Chinese Communist Party has taken a “militaristic interest” in the vital global shipping passage. 

The Texas Republican told lawmakers during a Senate Committee on Commerce, Science & Transportation hearing that President Donald Trump recently has highlighted two key issues — “the danger of China exploiting or blocking passage through the canal” and “the exorbitant costs for transit.”  

“Chinese companies are right now building a bridge across the canal at a slow pace so as to take nearly a decade. And Chinese companies control container ports at either end. The partially-completed bridge gives China the ability to block the canal without warning and the ports give China ready observation posts to time that action,” said Cruz, who is the chairman of the committee. 

“This situation I believe poses acute risks to U.S. national security,” he added. 

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Sen. Ted Cruz, R-Texas, is warning lawmakers Tuesday about China’s influence on the Panama Canal. (AP/Ben Curtis/Arnulfo Franco/AFP via Getty Images)

“Meanwhile, the high fees for canal transit disproportionately affect Americans because U.S. cargo accounts for nearly three quarters for canal transits. U.S. Navy vessels pay additional fees that apply only to warships. Canal profits regularly exceed $3 billion dollars,” Cruz continued. “This money comes from both American taxpayers and consumers in the form of higher costs for goods.” 

Cruz’s comments come as newly sworn-in Secretary of State Marco Rubio will travel to Panama for his first international trip as the nation’s top diplomat, Fox News has learned.  

Trump said during his inauguration speech last week that “China is operating the Panama Canal” and “we didn’t give it to China, we gave it to Panama, and we’re taking it back.” 

Panama is denying the Chinese influence, with President José Raúl Mulino saying that “There is no presence of any nation in the world that interferes with our administration,” according to the Associated Press.

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President Donald Trump said during his second inauguration speech that “China is operating the Panama Canal.” (Fox News)

However, Federal Maritime Commission Chairman Louis Sola testified Tuesday that “Since 2015, Chinese companies have increased their presence and influence throughout Panama. 

“Panama became a member of the Belt and Road Initiative and ended its diplomatic relations with Taiwan. Chinese companies have been able to pursue billions of dollars and development contracts in Panama, many of which were projects directly on or adjacent to the Panama Canal,” he told lawmakers. “Many were no bid contracts, labor laws were waived, and the Panama and Panamanian people are still waiting to see how they’ve been benefited. 

“It is all more concerning that many of these companies are state-owned and in some cases even designated as linked to the People’s Liberation Army,” Sola added. “We must address the significant growing presence and influence of China throughout the Americas and in Panama specifically.” 

Cruz also said during the hearing that the Chinese Communist Party has taken a “militaristic interest in the canal” and that “Panama has emerged as a bad actor.” 

“Panama has for years flagged dozens of vessels in the Iranian ghost fleet, which brought Iran tens of billions of dollars in oil profits to fund terror across the world,” Cruz said. 

Two cargo ships enter the Miraflores Locks of the Panama Canal in Panama City on Jan. 22. (Martin Bernetti/AFP via Getty Images)

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“We cannot turn a blind eye if Panama exploits an asset of vital commercial and military importance, and we cannot stay idle while China is on the march in our hemisphere,” he concluded. 

Fox News’ Nick Kalman and Bradford Betz contributed to this report.