28 August 2020
- Growing global competition over ports will raise political and security tensions, particularly between China, India and the West
- Chinese investment in ports will increase as part of policies to gain self-sufficiency including control over key trade routes
- Ports will serve dual commercial and military purposes, but US dominance will limit threat as a result of Chinese overseas military bases for now
Beirut’s port has reportedly resumed operations at 80% capacity since 24 August, following a major explosion earlier this month (see our 5 August Special Report). Ships had been temporarily diverted to Tripoli, Lebanon’s second largest port, which has been a focus for Chinese and Russian investment in recent years. China sent UN peacekeepers to provide medical support following the explosion, prior to which Beijing also said it was seeking to increase investment in Lebanon. Separately, Myanmar approved a Chinese joint venture to develop the long-delayed Kyaukpyu port and a special economic zone in western Rakhine State on 6 August. Kyaukpyu is a key element of the China-Myanmar Economic Corridor, which forms part of China’s Belt & Road Initiative (BRI).
China’s agreement in Myanmar and interest in Lebanon are two of many examples of Chinese state-owned companies investing in ports and surrounding areas, often as part of the BRI. Indeed, since 2010 Chinese and Hong Kong companies have invested over USD 45 billion in ports worldwide. For instance, a Chinese state-owned company signed an agreement in July with Greece’s Thessaloniki port – to promote it as a gateway for Chinese investment into Europe, while a different Chinese company already owns a majority stake in Greece’s largest port, Piraeus. Piraeus is a flagship BRI project, along with Gwadar port in Pakistan – the centre of the China-Pakistan Economic Corridor – and Colombo Port City in Sri Lanka, where China also controls the developing Hambantota…