In the year ending June 2017, Chinese companies, including Cosco, spent $20 billion purchasing overseas ports. This was double the amount they invested in the same period a year earlier. China’s shipping investments are driven by a long-term push for control of strategic maritime assets, which is seen as more important than near-term economic efficiency and/or a reduced debt burden.
From Beijing’s perspective, the shipping investments are partly a defensive strategy. China’s economy is currently reliant upon foreign shipping companies to export the mobile phones, furniture, and shoes it produces, and also to supply the country with the raw materials and finished goods needed by its enormous domestic consumer market. From a geopolitical standpoint, China’s increasing control over shipping and ports provides it protection and projection.
The spending splurge on shipping is also in line with Chinese President Xi Jinping’s One Belt, One Road strategy, which is aimed at deepening infrastructure and trade links with Asia and Europe. At the moment, Chinese companies control three times as much capacity at European ports as European companies do in China. Not a single Chinese port is majority-owned by a European company, while an increasing number of European ports are either completely-owned or partially-owned by Chinese companies.