Donald Trump has begun his second term as president by ramping up pressure on Panama – threatening to “take back” the Panama Canal and accusing the country of ceding control of the strategically critical waterway to a US rival: China.

President Trump is wrong when he says China controls the Panama Canal. But the U.S. rival does have influence there, and the administration is moving to counter it.

"Currently, the cooperation between China and Panama under the framework of the Belt and Road Initiative is proceeding normally," ministry spokesperson Lin Jian told a press briefing when asked about Panama's decision to let its involvement in the infrastructure plan expire.