The role of seaports in the US-China trade conflict

If the US-China trade conflict erupts, port logistics will be a key target for Beijing’s retaliation because it controls much of the logistics chain at US ports; about 80% of container cranes in the US originate from China; and in some cases, China even has stakes in US port operators.

This dependence has US authorities concerned that Beijing could use this dominant position to disrupt US supply chains. This is partly why US President Joe Biden in February issued measures to improve information technology security of cranes and related logistics systems at ports. The US Coast Guard has issued additional regulations that will take effect in November 2024. The reason for the US to issue stricter safety regulations is that it suspects that Chinese state-owned Shanghai Zhenhua Heavy Industries (ZPMC), the world market leader in container cranes with a market share of about 70%, can remotely access crane systems at US ports. Remote access over the internet could be considered legitimate for maintenance work. This would also allow the manufacturing company to collect information about containers being transported or remotely shut down cranes. China has been investing in global logistics for years. In addition to building railways, port investment is part of the Belt and Road Initiative (BRI). When it comes to Chinese investment, there is always a discussion about the risks and dangers of relying too much on Beijing. In addition to security concerns and geopolitical risks, the debate often has a protectionist tone: China's economic progress should be limited. This spring, the US government announced billions of dollars in port infrastructure, aiming to bring crane manufacturing back to the country. In addition, maritime logistics is a vulnerable element of the US economy because even the US armed forces, with bases and operations around the world, rely on working ports. According to the "Wall Street Journal", Chinese ZPMC cranes are also equipped in some ports used by the US military. It is therefore possible to imagine several scenarios in which China could exploit remote access to port cranes in the US to harm the US economy or military. Remote access to US port logistics would be very useful to China in the event of increased tensions between the world’s two largest powers. If China were to succeed in disrupting logistics at container ports such as those in Long Beach or Seattle, this could have serious consequences for the US. The US places a high priority on national security because it is a global power. So, on the one hand, the US has to deal with threats that are more comprehensive and severe than most other countries, and on the other hand, economically, Washington can afford to take measures to protect its critical infrastructure and gradually become independent of products from China.

Customs Newspaper

Source: https://vimc.co/vai-tro-cua-cang-bien-trong-xung-dot-thuong-mai-my-trung/