China has more chokepoints in its pocket than rare earths. That vulnerability was underscored by the recent arrest of a Chinese executive in Paris.
He’s with a Chinese shipping container company. Chinese companies produce 95 percent of the world’s containers, the unit of global trade, and seaborne shipping via containers accounts for about half of global trade value.
Unlike rare earths, there’s no special processing tech to replicate in shipping. But when you make 95 percent of the world’s moving boxes, or containers, you have tremendous leverage in the industry.
The United States has long been “sea blind” and is now waking up. That is how maritime historian Salvatore Mercogliano describes Washington’s newfound awareness.
“We equate sea power with military naval power. We’re not equating it with commercial trade,” he told The Epoch Times. “China’s doing both, and they understand that. And I think that’s where the U.S. has to catch up, and that’s the sea blindness.”
Washington had assumed other world powers want the ocean to be open and free, and that commerce would naturally come to our ports. And then COVID opened our leaders’ eyes regarding the national security risks that come with supply chain dependence.
Shipping companies rushed empty containers back to Asia during the pandemic because the U.S.-bound trip was more profitable. That left U.S. export businesses with insufficient capacity, resulting in delayed shipments and profit losses due to steep increases in freight costs.
It’s not just containers. Today, China dominates shipbuilding, ports, cranes, chassis, and crews.
The recent DOJ indictment is only one part of the overall U.S. response. Washington has resorted to multiple channels to map out China’s maritime dominance. Beyond shipbuilding, the United States needs a clearer understanding of how far it lags behind China, according to Mercogliano.
Poking at China’s maritime dominance also increases President Donald Trump’s negotiation leverage in the U.S.-China trade war, said Mike Sun, a U.S.-based Chinese business consultant.
The next high-level U.S.-China event will be Chinese leader Xi Jinping’s visit to Washington, pending confirmation. In the meantime, both sides are accumulating leverage. That puts global maritime trade in the geopolitical crosshairs.
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—Terri Wu
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