Diplomacy
Trump threatens Panama Canal annexation over ‘unfair’ fees

U.S. President-elect Donald Trump asserted on Saturday that the Panama Canal imposes “exorbitant prices and tolls” on U.S. Navy and merchant ships, threatening to demand its return if the fees are not reduced. His comments, shared on the Truth Social platform, reignited debates over the canal’s strategic and economic significance.
“The fees charged by Panama are ludicrous, especially given the extraordinary generosity bestowed on Panama by the United States. This complete ‘theft’ from our country will be stopped immediately,” Trump stated.
The United States, the canal’s largest customer, accounts for approximately 75% of its annual cargo transit. However, prolonged droughts have disrupted operations, exacerbating supply chain challenges. National Economic Council Director Lael Brainard linked these disruptions to inflationary pressures in a statement last week.
Despite its financial contributions, the Panama Canal Authority reported a $2.47 billion contribution to Panama’s treasury in fiscal 2024, marking a consecutive annual decline. Deepwater transits also dropped by 21% in 2024 compared to 2023 due to water conservation measures.
Built by the U.S. and completed in 1914, the 51-mile-long canal was handed over to Panama in 1999 as part of a 1977 treaty signed by President Jimmy Carter—a move Trump called “stupid.”
Trump raised concerns over the canal “falling into the wrong hands,” implying Chinese influence. China is the second-largest user of the canal, and a Hong Kong-based company manages two of the five ports on its flanks. Panama severed diplomatic ties with Taiwan in 2017 and established relations with China, further solidifying Beijing’s economic footprint in the country.
“It was not given for the benefit of others, but only as a demonstration of cooperation between us and Panama,” Trump declared, urging Panamanian authorities to respect the canal’s original intent.
Panama President José Raúl Mulino dismissed Trump’s claims, reaffirming that the Panama Canal and its adjacent areas remain under Panamanian sovereignty. “The sovereignty and independence of our country are non-negotiable,” Mulino asserted.
He defended the canal’s fee structure as being market-driven and aligned with operational and modernization costs. The canal remains a critical economic engine for Panama, contributing billions annually. Its fees are based on metrics such as tonnage and vessel capacity. For instance, Panamax-class container ships with a capacity of 2,500 TEU pay $172,000 empty and $247,000 full, and Neopanamax vessels with a 12,000 TEU capacity pay between $622,000 and over $1 million, depending on cargo.
The unit cost per ton is projected to decrease from $11.79 in 2024 to $10.63 in 2025, according to official estimates.
While Trump advocates for renegotiation, Panama continues to strengthen ties with China. Discussions on a trade agreement, stalled since 2018, may resume in 2025, signaling the deepening influence of Beijing in the region.
However, Mulino rejected allegations of foreign control, stating, “Neither China, nor the European Community, nor the United States, nor any other power has any direct or indirect control over the canal.”
During his campaign, Mulino emphasized cooperation with the U.S. on migration issues, including closing the Darién Corridor—a key transit point for migrants heading to the U.S.
Diplomacy
Armenia signals potential complete withdrawal from CSTO

Armenian Deputy Foreign Minister Vahan Kostanyan announced that Yerevan might decide to withdraw entirely from the Collective Security Treaty Organization (CSTO) if member states fail to “demonstrate a clear political stance” regarding Azerbaijan’s actions. Kostanyan emphasized that Armenia is no longer making insinuations but is speaking very openly.
According to the Novosti-Armenia news agency, Kostanyan stated, “Ultimately, if our partners in the CSTO, including the Russian Federation, do not make the political statements that were mentioned several years ago after the aggression against the sovereign territory of the Republic of Armenia, then Armenia will make a final decision.”
The Deputy Minister also underscored that Armenia, as a sovereign state, will determine the right time for its next steps.
Membership was frozen
Relations between Armenia, Russia, and the CSTO deteriorated following the conflicts in Nagorno-Karabakh, after which Yerevan formally requested support from its allies.
Following this process, Prime Minister Nikol Pashinyan repeatedly criticized the CSTO for not assisting Yerevan.
Pashinyan described the organization as a “bubble alliance,” claiming it was “planning a war” against Armenia alongside Baku.
Last February, Prime Minister Pashinyan announced that Armenia had frozen its participation in the CSTO. By May, the Armenian Ministry of Foreign Affairs reported that the country would refuse to finance the organization’s activities.
Intelligence report points in the same direction
In January of this year, a public report released by the Armenian Foreign Intelligence Service stated that the country has no intention of returning to full participation in the CSTO in the near future.
The report noted, “We find it highly unlikely that the reasons that led to Armenia suspending its membership will change in 2025. Based on this situation, the organization’s prestige continues to be seriously questioned and has become a ’cause for reflection’ for other member countries.”
Diplomacy
BRICS internal trade volume hits the $1 trillion mark

Kirill Dmitriev, Special Representative of the President of the Russian Federation and CEO of the Russian Direct Investment Fund (RDIF), announced that the internal trade volume among BRICS countries has reached $1 trillion.
In a statement on his Telegram channel, Dmitriev noted that surpassing this significant milestone confirms the strengthening of economic ties between member states and the bloc’s growing role in shaping the new global economic architecture.
He also emphasized that Russia continues to strengthen trade relations, particularly through the BRICS Business Council, in line with the directives of President Vladimir Putin.
BRICS’ share will continue to grow, Putin says
During a plenary session at the St. Petersburg International Economic Forum on June 20, Russian President Vladimir Putin recalled that at the beginning of the 21st century, BRICS countries accounted for only one-fifth of the global economy, whereas today this figure has reached 40%.
The Russian leader stated that this share will continue to grow, describing it as a “medical fact.” According to Putin, this growth will primarily be driven by the countries of the Global South.
In April, Maxim Oreshkin, Deputy Chief of Staff of the Presidential Administration of Russia, also said that the BRICS countries, operating on principles of consensus, have become a key force in the world economy.
BRICS expansion agenda
Initially composed of five countries—Brazil, Russia, India, China, and South Africa—BRICS expanded in 2024 with the inclusion of the United Arab Emirates (UAE), Iran, Ethiopia, and Egypt.
In January of this year, Indonesia became the bloc’s tenth full member.
Diplomacy
Xi Jinping to miss BRICS summit in Rio for the first time

Chinese President Xi Jinping will not attend the upcoming BRICS summit in Rio de Janeiro next week.
According to multiple sources cited by the South China Morning Post on Tuesday, this marks the first time Xi will miss the gathering of leaders from major emerging economies.
Officials familiar with the matter stated that Beijing informed the Brazilian government of a scheduling conflict. Premier Li Qiang is expected to lead the Chinese delegation in Xi’s place, a similar arrangement to the 2023 G20 summit in India.
Chinese officials involved in the preparations suggested Xi’s absence is due to his two meetings with Brazilian President Luiz Inácio Lula da Silva within the past year. The first occurred during the G20 summit and a state visit to Brasília last November, while the second took place at the China-CELAC forum in Beijing this May.
Xi has never before missed a BRICS summit. In 2023, he was scheduled to deliver a speech at the meeting in South Africa but, at the last minute, sent Commerce Minister Wang Wentao instead. Beijing provided no official explanation for the change.
During the COVID-19 pandemic, Xi participated in BRICS meetings virtually, with Russia hosting in 2020 and China in 2021.
On Tuesday, the Brazilian Foreign Ministry told the Post it “would not comment on the internal deliberations of foreign delegations.” The Chinese embassy in Brazil did not immediately respond to requests for comment.
However, Chinese Foreign Ministry spokesman Guo Jiakun told the Brazilian newspaper Folha de S.Paulo, “information regarding participation in the summit will be shared at the appropriate time.” Guo added that China supports Brazil’s BRICS presidency and aims to “promote deeper cooperation” among member nations. “In a volatile and turbulent world, the BRICS countries are maintaining their strategic resolve and working together for global peace, stability, and development,” he said.
In Brasília, officials have not concealed their disappointment regarding Xi’s absence. A source informed the Post that Lula had traveled to Beijing in May as a “show of goodwill” and had hoped “the Chinese president would reciprocate the gesture by attending the Rio summit.”
There was also speculation that Lula’s invitation to Indian Prime Minister Narendra Modi for a state dinner after the BRICS summit may have influenced Beijing’s decision, as Xi might have been “perceived as a supporting actor” at the event.
Lula’s special adviser for international relations, Celso Amorim, met with Chinese Foreign Minister Wang Yi in Beijing, where he clearly expressed Brazil’s desire to host Xi. “I told them, ‘BRICS without China is not BRICS,'” Amorim stated, recalling that then-President Hu Jintao attended the first BRICS summit in Brazil despite a major earthquake in China at the time. “He only stayed for one day, but he came.”
Amorim emphasized the particular importance of Xi’s attendance in the current global context, citing the “US withdrawal from the Paris Agreement and the World Health Organization” as a “violation of international rules.”
Premier Li is expected to arrive in Brazil next weekend for the summit, which is scheduled for July 6 and 7 in Rio.
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