The comptroller’s office sent a team of auditors on Monday to the local offices of Panama Ports Co., a subsidiary of Hong Kong billionaire Li Ka-shing’s CK Hutchison Holdings Ltd., to launch their investigation, the comptroller’s office said on X. 

Auditors will conduct an “exhaustive” review to “guarantee the efficient and transparent use of public resources,” according to the statement. 

The scrutiny comes as Trump accuses Panama of allowing China to meddle in the canal. In his inaugural address on Monday, Trump reiterated his claim that China is operating the waterway and said that his administration would take it back. Hong Kong is a Chinese city but with its own borders, currency and legal system.

The move underscores Hong Kong companies’ increasing exposure to geopolitical risks as politicians across the political divide in Washington diminish the city’s distinction from mainland China. 

During his first term, Trump signed an executive order to revoke preferential treatment of the former British colony in response to a Beijing-imposed national security law. Marco Rubio, freshly confirmed as secretary of state, co-authored a bill as senator to shut down Hong Kong’s trade outposts in the US, which—if passed—could further weaken the semi-autonomous city’s global profile.

CK Hutchison’s ports business contributed about 15% of the conglomerate’s profit in the first half of 2024. Growth was mainly driven by increased cargo handling in Central America, where it has nine other ports in Mexico and the Bahamas. The unit could face increasing uncertainty with Trump proposing a global trade overhaul, including imposing tariffs of up to 25% on Mexico and Canada. 

More than a fifth of CK Hutchison’s profit came from regions including the Americas, Australia, Canada and the Middle East—areas that could become affected by heightened US-China tensions. The majority of the group’s business in these regions involves infrastructure, a sector that could be heavily affected by government regulatory changes.

The group’s shares were little changed in Tuesday morning trading in Hong Kong. The stock is down around 3.4% this year. 

Panama’s Comptroller General Anel Bolo Flores said last week the probe would seek to verify compliance with the terms of a 25-year concession granted to the company and promised a “severe and strong” financial audit. Panama initially granted the concession in 1998, and the Panama Maritime Authority authorized its renewal in 2021. 

Flores said the ports now handle significantly more cargo than in 1998 and the concession doesn’t include a large enough share of revenue for the government. Flores visited the Maritime Authority on Monday to inform them of the audit. 

Panama’s government has repeatedly denied that there is any Chinese presence in the canal, and Trump hasn’t yet produced any evidence to contradict this. 

President Jose Raul Mulino on Monday reiterated in a post on X that the canal will remain under Panamanian control.

Li himself had a taste of what it’s like being caught between two superpowers in 2020, when Trump’s former secretary of state, Mike Pompeo, warned Israel of a CK Hutchison affiliate’s bid to build infrastructure in the Middle East country, citing the firm’s alleged connection to the Chinese Communist Party. The company lost the tender.