ECONOMYJune 4, 2026

Trump’s ‘Donroe’ Doctrine targets China in the Americas

Junhua Zhang

Reading time: 12 min

President Trump is confronting China’s BRI influence in the Western Hemisphere, targeting Venezuelan oil and Panama’s port control.

The beginning of U.S. President Donald Trump’s second term has signaled the dawn of a new world order. Central to this shift is the “Donroe” Doctrine – a portmanteau of “Donald” and the Monroe Doctrine. Proclaimed by President James Monroe in December 1823, the original doctrine rejected European interference in the Americas and warned against further colonial expansion.

Today, President Trump has asserted that the Western Hemisphere remains America’s backyard and exclusive sphere of influence, where no foreign superpower may intrude. During his first term, National Security Advisor John Bolton coined the term “troika of tyranny,” referring to the authoritarian regimes of Cuba, Venezuela and Nicaragua. From Mr. Trump’s perspective, these nations held less importance for their political implications and more for being geographical and economic barriers to America’s return to its own backyard.

President Trump is seeking to accommodate the major powers, Russia and China, within their respective spheres of influence, with the aim of achieving peaceful coexistence and thereby maintaining regional geopolitical stability. This approach is fully reflected in the Trump administration’s National Defense Strategy (released in January 2026) and in his foreign policy.

The key question is whether this tripartite power balance can be imposed on America’s terms. Russia, currently preoccupied with the war in Ukraine, appears temporarily unable to consolidate its existing interests, let alone pursue expansion. Moscow is already stretched thin managing its own neighborhood.

China, however, presents a different challenge. Its economic expansion is ambitious and multifaceted. So far, under the Belt and Road Initiative, 3,000 projects have been completed, spanning more than 150 countries worldwide while blending hard and soft power. Under the current U.S. administration’s application of the Donroe Doctrine, China is most affected.

Beijing hopes to benefit from President Trump’s vision of the tripartite power balance. President Xi Jinping believes the U.S. and China are – and should remain – the two most decisive players shaping global affairs. The recent Xi-Trump summit seems to confirm his view. However, as Washington moves to reclaim the Western Hemisphere, China’s responses have been mixed. While Beijing stayed relatively quiet after the capture and extradition of Venezuelan President Nicolas Maduro, it has responded far more aggressively over the Panama Canal.

Beijing’s silence on Venezuela

The U.S. arrest and extradition of Nicolas Maduro in January 2026 served as a stark warning to other nations in the Americas – a case of “killing the chicken to scare the monkeys,” as the old Chinese idiom goes. Under Mr. Maduro’s leadership, Venezuela had become a key ally of China. After assuming the presidency, his first foreign trip was to Beijing, and China has since provided substantial support, establishing itself as Venezuela’s vital creditor and strategic partner.

Venezuela holds the world’s largest proven oil reserves, totaling 30 billion barrels, with China its biggest buyer. During the Maduro regime, the U.S. implemented a comprehensive blockade on Venezuelan oil exports, which greatly hampered the country’s oil trade. To maintain basic export volumes, Petroleos de Venezuela (PDVSA), the state-owned oil and gas company, had to offer steep discounts.

China and Venezuela developed a distinctive “oil-for-loans” cooperation model. Since 2007, China has extended approximately $60-63 billion in loans for infrastructure and energy projects. Venezuela repays the principal and interest with discounted oil or fixed quantities of crude. By 2025, China was importing around 463,000 barrels of Venezuelan crude per day, accounting for 70-80 percent of Venezuela’s total oil exports. China has relied on cheap oil to meet its energy needs while maintaining low prices for various petroleum products, including plastics. This has subsequently laid the groundwork for dumping Chinese goods onto the global market.

The current U.S. administration has focused heavily on Venezuelan oil. Following Mr. Maduro’s arrest on January 3, 2026, U.S. Energy Secretary Chris Wright visited Caracas. Washington has since authorized five major Western oil companies to resume operations in Venezuela. The license issued by the U.S. Treasury Department includes strict “exclusion clauses” explicitly barring participation from China, Russia, Iran and other nations.

China is deeply dissatisfied with its exclusion but has so far avoided direct confrontation for two main reasons.

First, with Mr. Maduro now detained in the U.S., the real power in Venezuela rests with interim President Delcy Rodriguez. However, her stance toward China is still unclear. Beijing hopes the new government will restructure the over $60 billion in debt it owes to China. Should Venezuela classify China’s debt as “odious debt” and refuse repayment obligations, Beijing risks recovering nothing.

Second, Mr. Maduro’s recent actions have prompted Beijing to reconsider its position. In February, while detained in New York, he told his son in a phone call that Venezuela was on the right path. Beijing interpreted this as endorsement of the pro-American Rodriguez government.

Beijing’s relatively muted reaction to Trump’s Venezuela policy stems largely from expectations of a quid pro quo with the U.S. During President Trump’s recent visit to Beijing, neither side mentioned Venezuela. Instead, President Xi tacitly acknowledged U.S. interests in Venezuela by expressing hope that President Trump will guarantee non-interference in Taiwan’s affairs, or at least adopt a more China-friendly stance, such as slowing or reducing arms sales to Taiwan.

The Panama Canal and China

The Panama Canal handles approximately 40 percent of U.S. container traffic and 5 percent of global trade volume. Built by the U.S., the canal was under U.S. control for a century before being handed over to Panama in 1999. Today, Panama’s two largest trading partners are the U.S. and China. According to United Nations data, China overtook the U.S. as Panama’s largest trading partner in 2019. Bilateral trade reached $12.8 billion in 2024, nearly double the 2017 level.

The U.S. considers the Panama Canal a vital strategic asset. Its National Defense Strategy underscores the importance of maintaining American military and commercial access to critical regions spanning from the Arctic to South America, with the Panama Canal specifically highlighted. U.S. strategists have long expressed concerns about Chinese corporate control over key ports at both ends of the canal. Is the U.S. perspective justified?

Until the U.S.’s recent intervention on the issue, Panama had consistently denied claims that China controls the waterway linking the Atlantic and Pacific Oceans. Panama has now aligned itself with the U.S. position, partly due to American pressure and partly because of China’s inappropriate official conduct.

A central player is Hong Kong’s Cheung Kong Group, now operating primarily as CK Hutchison Holdings. Since 1997, the two ports it operates in Panama, Balboa Port and Cristobal Port, have served as global logistics hubs located at either end of the Panama Canal. In 2021, the concession for these ports was extended for another 25 years.

Last year, CK Hutchison planned a massive asset restructuring initiative. The company aimed to sell its global portfolio of 43 port assets, including the two ports in Panama, to an international consortium led by U.S. asset management giant BlackRock and Italy’s Mediterranean Shipping Company for approximately $22.8 billion.

Although this was a commercial transaction, President Xi viewed the ports as strategically vital from China’s mercantilist perspective. He insisted that all Chinese companies, including those in Hong Kong, must adhere to the directives of the Chinese Communist Party. Controlling key global waterways and ports is essential for enabling the widespread distribution of Chinese goods in international markets.

However, President Xi did not realize that his overt interference only heightened suspicions among the already cautious U.S. and Panamanian governments, reinforcing their view of China as a threat.

Aftermath of the Panama Supreme Court ruling

On January 29, 2026, Panama’s Supreme Court declared the concession granted to CK Hutchison for operating ports at both ends of the Panama Canal, along with all renewal clauses enacted since 2021, fundamentally “unconstitutional” and therefore null and void.

The court’s reasoning: These concessions violated Panama’s constitutional guarantee of permanent state sovereignty over strategic infrastructure. Additionally, Panama’s laws prohibited granting exclusive privileges and permanent tax exemptions to foreign capital. A previous audit report estimated that the government had lost approximately $1.2-$1.3 billion due to these contractual terms.

Panamanian President Jose Raul Mulino delivered a televised address that afternoon, ordering a “temporary takeover” of both ports on grounds of “urgent social and public interest needs.” He forcibly transferred management and operational control to Panama’s National Maritime Authority.

Almost simultaneously with the takeover, the Panamanian government announced an 18-month transition plan, establishing two temporary companies to manage the ports. APM Terminals, a Maersk subsidiary, will oversee the Pacific-side Port of Balboa, while Terminal Investment Corp., owned by Mediterranean Shipping Company, will manage the Atlantic-side Port of Cristobal. At the end of the transition, a new international public tender will select long-term operators.

China has responded with countermeasures, including suspending negotiations on new projects with Panama, increasing inspections on Panamanian imports and urging shipping companies to reroute cargo. CK Hutchison has initiated arbitration proceedings with the International Chamber of Commerce.

More by Junhua Zhang

• China’s careful hedging in the Iran war
• Will Trump’s plan to split Russia and China succeed?
• The U.S.-China rare earths gambit: Who blinks first?

The Xi administration miscalculated by overestimating Panama’s dependence on China. Even though China is Panama’s largest trading partner, its share of the Latin American country’s trade stands at only 20 percent. This explains President Mulino’s firm stance: Panama would not reverse its decision. On February 24, Panama cleared the two ports at night, barring CK Hutchison representatives from entry.

In response, China has detained a record 70 Panama-registered ships under various pretexts, including security inspections. Since vessels flying the Panamanian flag account for a significant share of U.S. container trade, China’s actions could have major commercial and strategic implications for the U.S. shipping industry. Consequently, America has joined forces with six Latin American countries to protest China’s actions.

At the same time, Beijing has been pressuring the companies temporarily taking over port management, threatening that if they proceed with the takeover, they will be barred from conducting business in China, among other measures.

The Chinese government’s reaction revealed just how crucial the Panama Canal is to its interests. Ensuring open shipping routes is essential to China’s exports and trade, especially under President Xi, who places great emphasis on export growth. Beijing’s reaction to the Panamanian government also highlights an important factor: Panama severed diplomatic ties with Taiwan in 2017 in favor of recognizing China. The current developments could potentially allow Taiwan to regain influence in Panama. If this happens, it might set off a chain reaction throughout South America.

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