Reinvestigation: True Picture of China's global port investments
Instead of creating "security worries" as some Western media claimed, China's expanding investments in overseas ports have in fact garnered considerable revenue for local governments, driven economic development, boosted the construction of local infrastructure, and increased employment in these regions.
BEIJING, Aug. 4 (Xinhua) -- In the past few months, the Voice of America (VOA) and the Wall Street Journal (WSJ), among other U.S. media outlets, have been hyping up the narrative of "security concerns related to Chinese investments in overseas ports," alleging that they "could be used for military purposes" in the future.
Besides commercial value, "Chinese-run port terminals can be used not only for logistics support but also intelligence gathering and as future potential basing options," a WSJ report entitled "China's global port investments give rise to security worries" claimed, citing American security analysts, yet without giving any evidence.
"As commercial ports could be used for military purposes, analysts have long been concerned about the security implications of ports controlled by Beijing," another report by the VOA, entitled "China's Global Network of Shipping Ports Reveal Beijing's Strategy", said.
The above claims are nothing but groundless speculations, analysts say, emphasizing the fact that whether an investment in a foreign port can be used militarily depends on many conditions, among which is permission from the government of the host country as a sovereign state.
In fact, China's rapidly expanding investments in overseas ports in recent years are a natural outcome of its rapidly growing trade with the international market.
Given China's status as the world's largest trader of goods and a major trading partner of more than 140 countries and regions around the world, it is not in line with commercial logic if China did not expand its investments in overseas ports considering such factors as trade and shipping facilitation and transaction cost saving, the analysts say.
THE TRUE PICTURE
"Chinese companies' investment in some foreign ports is first and foremost an economic act, and its starting point and focus are to facilitate China's ocean freight logistics," said Wang Zaibang, a senior fellow at Taihe Institute, a Beijing-based think tank.
"This kind of investment is not only beneficial to the business activities of China's overseas shipping companies, but also conducive to stimulating the local economy and promoting employment. We can be optimistic that, barring extreme circumstances, such investment can only grow as the size of China's economy and the stock of overseas interests continue to grow," he told Xinhua in a recent interview.
Currently, China's shipping fleet control capacity has risen to the second place in the world from the third place in 2015. As the world's most important intermediate goods provider and the largest supplier of final products, China's docking with the international market not only requires the continuous facilitation of bilateral or multilateral trade and investment, but also the orderly docking and arrangement of global transportation channels, said Zhang Yugui, dean of the School of Economics and Finance of Shanghai International Studies University.
Over the past decade since the Belt and Road Initiative (BRI) was launched in 2013, China has signed more than 200 cooperation documents with more than 150 countries and more than 30 international organizations, resulting in more than 3,000 cooperation projects and generating nearly 1 trillion U.S. dollars in investment, official statistics show.
Under the joint efforts of participating countries, a connectivity framework involving six corridors, six types of routes, multiple countries and multiple ports have taken shape, playing a key role in transcending geographical constraints and cultural differences, and in facilitating economic development across the world.
During this process, Chinese companies and overseas local authorities have carried out port cooperation projects with an aim to create opportunities for common development under the principles of extensive consultation, joint contribution and shared benefits on the basis of respecting the will of relevant countries. China has never interfered in other countries' internal affairs, targeted a third party, or posed a security threat to any country.
This aerial photo taken on Feb. 15, 2019 shows a container ship of the COSCO Shipping approaching Piraeus port, Greece. (Xinhua/Wu Lu)
Since 2009, Chinese shipping giant COSCO has invested more than 600 million euros (about 660 million U.S. dollars) in the construction and upgrading of the Container Terminals 2 and 3 in Greece's Piraeus port. In 2019, the port's container throughput has exceeded 5.65 million TEUs (twenty-foot equivalent unit), becoming the first integrated port in the Mediterranean, the fourth largest in Europe and one of the fastest growing container ports in the world, with revenue of 195 million euros (214.5 million dollars) in fiscal year 2022, an increase of 26.2 percent, and a net profit of 52.9 million euros (58.2 million dollars), an increase of 43.9 percent.
The Colombo Port City in Sri Lanka, the first special economic zone constructed and operated by Chinese firms outside of China, has been designated as one of the "Five New Cities Affecting the Future" by Forbes magazine in the United States.
According to management consulting firm Price Waterhouse Coopers Consulting, Colombo Port City will attract more than 9.7 billion dollars in foreign direct investment for Sri Lanka during its development and operation, generate more than 5 billion dollars in fiscal revenue for the Sri Lankan government, and create more than 400,000 quality jobs for the locals.
The project "will promote Sri Lanka's economic development, improve people's livelihood and boost the modernization process of Sri Lanka," said Sri Lankan Ambassador to China Palitha Kohona, adding that "many of the great changes that have taken place in Sri Lanka have benefited from the BRI."
Launched in January 2023 and invested, constructed and operated by China Harbour Corporation, the Nigerian Lekki Deep Water Port project is Nigeria's first modern deep-water port and one of the largest ports in West Africa, with an annual designed handling capacity of 1.2 million standard containers, which can accommodate the world's largest container ships.
Nigeria's former President Muhammadu Buhari said that the Lekki Port will "open up a new pattern for Nigeria's economic development, strongly promote the export of Nigerian products, especially agricultural products," and create many jobs, contributing to poverty reduction goals.
Built by Shanghai International Port (Group) Co., Ltd., the new Port of Haifa in Israel opened in September 2021, becoming the first large new port in Israel in nearly 60 years. It is by far the most advanced, greenest, fastest and most cost-effective terminal on the Mediterranean coast, using the most advanced port technology in the world.
"We have high hopes for the new port of Haifa to serve the entire region and become a regional logistics hub," said Yitzhak Blumenthal, CEO of the government-owned Israel Ports Company.
The above are just a few examples of the cooperation projects Chinese companies have implemented overseas, which have not only garnered considerable revenue for local governments and driven economic development, but also boosted the construction of local infrastructure and increased employment in these regions.
STRONG REBUKES
As a country long committed to peaceful development and promoting a community with a shared future for mankind, China currently has only one overseas naval support base in Djibouti, the main function of which is to serve the Chinese warships fighting piracy in the Gulf of Aden, Wang said.
Responding to the WSJ report's claim that "China's navy has stopped for replenishment or diplomacy at a third of the ports where China-based firms have investments," Wang said it is a matter of course and nothing wrong with China investing in foreign ports for non-war operations in peacetime.
As the world has been constantly threatened by hegemonism and power politics, terrorism and extremist forces, as well as local wars and regional conflicts, and Western countries led by the United States have been waging color revolutions in many countries triggering regional unrest, there is often a need for non-war operations such as the evacuation of Chinese nationals.
"Under such circumstances, warships of any country can naturally dock at foreign ports for supplies or transshipment, which is really not surprising," Wang said.
Meanwhile, various countries have come out to deny the U.S. allegations about the Chinese-invested ports' so-called "military purposes".
In a recent interview with France 24, Sri Lankan President Ranil Wickremesinghe said, "So far there has been no (Chinese) military base in Hambantota harbour... the security is controlled by the government of Sri Lanka... these are just speculations... We have no military agreement with China, there won't be a military agreement, I don't think China enters into one."
As for the Gwadar port in Pakistan, Shakeel Ahmad Ramay, chief executive officer of the Asian Institute of Eco-civilization Research and Development, an Islamabad-based think tank, has also recently said that "there was no (Chinese) military involvement."
This aerial photo taken on June 4, 2022 shows a port for fishermen in Gwadar of Pakistan's southwest Balochistan Province.(Xinhua/Jiang Chao)
"The China-Pakistan Economic Corridor (CPEC) is a purely economic development initiative... Since the very beginning, Western countries and their allies in the region have started propaganda. Why did they start to malign the BRI and the CPEC by one name or another name? Because they cannot compete in the development," Ramay told Xinhua.
Besides the "military purposes" hype, the WSJ report also alleged that "They (Chinese companies) are also aggregating shipping data in ways that some in Washington worry could give Beijing access to information about rivals' supply-chain vulnerabilities."
On that topic, insiders and analysts from Germany have provided an opposite perspective.
Chinese companies have contributed to the alleviation of the supply chain crisis in the Port of Hamburg through mutual cooperation and learning from German companies. In the future, Chinese companies will also play an important role in addressing challenges such as the digitalization and sustainable development of the Port of Hamburg, said Angela Titzrath, chairwoman of Hamburg Ports and Logistics AG.
"Both sides have established an equal and trusted partnership," she added.
"Numerous Chinese companies have settled in the city (Hamburg) and in the port, with whom the players in the port as well as we have been cooperating successfully for a long time," Axel Mattern, chief executive officer of Port of Hamburg Marketing, told Xinhua.
"In addition, cooperation with Chinese companies secures cargo in Hamburg and thus the supply flows in Germany and Europe," he added.
"The Chinese investment in the port of Hamburg is normal. (Yet) (t)here is a tendency that wants to separate the German economy from China, and the German government is facing pressure and constraints from this," Helga Zepp-LaRouche, founder and chairperson of the German think tank Schiller Institute, told Xinhua.
"I would say this is purely ideological, so I'm quite glad that the agreement of the Port of Hamburg went through at the last moment," she said.
Yannis Stournaras, governor of the Bank of Greece, told media recently: "Greece is one of the few countries in Europe (where) China has a very crucial investment, the Piraeus port, and it is going very well... Piraeus was a big port with huge competitiveness problems and now is one of the most competitive ports in Europe, so I think it was a successful investment."
MOTIVE BEHIND "CHINA THREAT"
As a matter of fact, the United States has also benefited from Chinese companies' investments in port management. Since 2002, COSCO Group has been an important customer and partner of Boston Port, and practical cooperation between both sides during the past 20 years has not only saved 9,000 jobs in Boston Port, but also created 400,000 more new jobs.
Mike Meyran, director of the Boston Port Authority, said that the Boston Port "is a perfect example of U.S.-China economic and trade cooperation."
However, some U.S. politicians and media have been wilfully neglecting these positive exchanges between their country and China, and have been continuing to churn out various versions of the "China threat" for many years, as a result of "the hegemonic behavior and deep-rooted militaristic thinking of the United States in the past hundred years," said Wang.
Yet these allegations are increasingly losing appeal. Even Americans are now beginning to see the truth. "Do you know how many military bases we have surrounding China? Three hundred and thirteen. Americans need to wake up. It is a different world. We have about 750 military installations in 80 countries," U.S. Democratic presidential candidate Marianne Williamson said recently.
Civic groups and local residents take to the streets to protest against the U.S. biological labs near a U.S. military base in Busan, South Korea, April 5, 2022. (Photo by James Lee/Xinhua)
"Look at how the rest of the world sees this. Do you think that they see China as a greater military threat to global security or the United States as a greater military threat to global security?" she asked.
The motive behind the U.S. exaggerations is "to sow discord and undermine the mutually beneficial cooperative relations between China and relevant countries," Wang said.
In the context of a serious decline in the United States' ocean transportation capacity, the U.S. playing up this new version of "China threat" is only meant to intimidate countries that accept Chinese port investments into giving up or weakening their cooperation with the Chinese side, with the intent to hurt China and hurt the investment target countries for its own benefit, Wang noted.
(Xinhua reporters Jiang Chao in Islamabad, Du Zheyu in Berlin and Chen Zhanjie in Rome contributed to the story.)
