China and Panama are witnessing another peak in their bilateral relationship as Chinese President Xi Jinping visits the Central American country today.

This is the first visit by a Chinese leader since the two countries established diplomatic relations in June, 2017.

The bond between the two countries was forged 160 years ago when the first group of Chinese laborers arrived in Panama and made contributions to the construction of the Panama Canal.

Panama has the largest Chinese population in Latin America – about 300 thousand ethic Chinese people currently live in Panama, which accounts for 7.5 percent of the country's total population.

The establishment of diplomatic relations between China and Panama has promoted their ties to a higher level.

China is currently the second-largest user of the Panama Canal. It is also the leading supplier of goods to the Colón Free Zone, the largest free trade zone in Latin America, which is located on Panama's Atlantic coast.

A cargo ship passes the Panama Canal. [File Photo: VCG]

In April, a direct flight was launched linking Beijing and Panama City, making it easier for economic collaboration and cultural exchanges between the two countries.

Panama was the first Latin American country to sign a memorandum of understanding with China on the Belt and Road Initiative.

The first direct flight between China and Panama, Air China flight CA885, arrives at Tocumen International Airport in Panama City on April 5, 2018. [File Photo: VCG]

The two sides are also negotiating on a free trade agreement – the fourth round wrapped up last week in Panama during which the two sides have made positive progress in sectors such as the trade in goods, services, and finance, and in investment and customs procedures. The next round of the negotiations will be held in China.