The rise of China in panama under Varela (2014-2019): A new Latin-American pivot of the silk road or a diplomatic ‘tour de valse’?

Chinese expansion into Panama has taken place in stages. In the 1990s, the PRC and Panama established trade ties. In the decades that followed, trade increased turning Beijing into a major trading partner of Panama and one of the most important users of its canal. In 2017, to everyone’s surprise, Varela’s administration broke off the long-standing diplomatic relations with Taiwan in favour of the PRC. Within two years, under President Varela, in the context of the BRI, bilateral relations have expanded across the board. The existence of significant cross-interests, as well as the dynamics at work since 2017, suggest that Panama could play a major or even ‘pivotal’ role for the BRI in Latin America. However, despite these interests and the significant achievements under Varela’s administration, the bilateral relationship faces substantial obstacles both within Panama and internationally. The significant expansion of Sino-Panamanian bilateral relations may therefore have been a simple “tour de valse”.