Panama’s ship registry has shrunk by 3.3% so far this year as owners move tonnage away from the flag under heavier Chinese port state control scrutiny, according to Clarksons Research.
The drop has put pressure on one of the world’s largest flag states, with Liberia and the Marshall Islands among the registries taking vessels that have left Panama.
The number of cargo ships above 10,000 dwt leaving the Panama registry rose to more than 80 in April and 150 in May, against a monthly average of below 40 in the first three months of the year and 55 for 2025 as a whole. Panama registers about 5,000 vessels in that segment.
Panama-flagged detentions in China climbed from 92 in March to 135 in April and 139 in May. The April-May total of 274 surpassed the 251 detentions recorded for all of last year, based on Tokyo MOU port state control data included in the source material.
The Panama Maritime Authority has issued Merchant Marine Notice MMN-11/2026, urging Panama-flagged vessels with strong compliance records to appeal port state control detentions or deficiencies in China where operators believe the measures are unjustified.
The notice also tells operators to contact the flag administration early if there are concerns over possible reprisals or if they prefer a confidential approach.
The pressure on the flag has coincided with a legal dispute over Panama Canal-linked port assets. Panama’s judicial authority lists a 29 January 2026 resolution declaring unconstitutional Law No. 5 of 1997, which approved the contract between the Panamanian state and Panama Ports Company. The official gazette later approved temporary concessions for APMT Panamá at Balboa and TIL Panamá at Cristóbal for up to 18 months, with concession payments of $26.1m and $15.8m, respectively.
CK Hutchison Holdings said in February that it had notified the Republic of Panama of an investment treaty dispute. The company said Panama Ports Company, its indirect subsidiary, had operated the Balboa and Cristóbal terminals for nearly three decades and that the Supreme Court decision affected the legal basis for those operations.
Clarksons Research is the data and analytics arm of Clarksons and provides shipping and trade information through platforms including Shipping Intelligence Network and World Fleet Register.
The Panama Maritime Authority is Panama’s maritime administration and oversees the Panama Ship Registry through the General Directorate of Merchant Marine.
CK Hutchison Holdings is a Hong Kong-based holding company with ports, infrastructure, retail, telecommunications and energy interests.
Panama Ports Company is an indirect CK Hutchison subsidiary linked to the Balboa and Cristóbal terminals.