Former Panamanian President Ernesto Pérez Balladares has launched a stern warning regarding the recent court ruling that declared the port concession contract unconstitutional. The politician expressed regret that the issue had to be resolved by the Supreme Court, describing the situation as "madness." In his view, such rulings create a precedent where the validity of contracts is questioned, and investors can no longer rely on the stability of the country's laws.
Last Thursday, the Supreme Court of Justice declared the 1997 contract unconstitutional. This agreement had granted a 25-year concession for the ports of Balboa and Cristobal to the Panama Ports Company (PPC), a subsidiary of CK Hutchison. The court's decision also annulled all subsequent addendums and the automatic extension signed in 2021. Pérez Balladares, who signed the original agreement, emphasized that the contract was distorted over time and plagued by constant non-compliance.
In response to the ruling, PPC defended the agreement and warned about the state's campaign against its own legal and contractual framework. The company argued that undermining a diligent investor damages Panama's reputation as a trustworthy jurisdiction and a competitive global logistics hub.
"Neither the country's largest firms nor state lawyers saw the unconstitutionality. Similarly, the negotiators never saw it," noted the former president.
Pérez Balladares ironically suggested that perhaps the Supreme Court should now be put in charge of negotiating concessions. He recalled a similar ruling in 2023 regarding a copper mine, reinforcing the negative message sent to the international investment community. Despite the legal turbulence, PPC reiterated its commitment to Panama, its workers, and the communities of Balboa and Colón.
