Chinese investment in ports raises a storm in Brussels

The South China Morning Post reports on a row between Belgian Foreign Minister Hadja Lahbib and the Chinese Embassy in Brussels, following comments by the Minister on a recent report by Professor Jonathan Holslag. The report, entitled “Every Ship a Warship”, raised alarm about the “growing politicization and militarization of China’s civilian maritime sector”. State-owned China Ocean Shipping Co owns minority stakes in the Antwerp-Bruges port, a fact that Lahbib said she was uncomfortable with. “I believe above all that in the current context, our eyes are turned to China, which is a partner, a rival and a potential enemy. Civilian ships are being modified to potentially become military ships. We have to think about it and be very careful,” Minister Lahbib commented.

Following the comments, Wu Gang, Minister Counsellor at the Chinese Embassy in Belgium, requested a meeting with Belgium’s top official for Asia, which took place on October 14. According to a diplomatic cable quoted by the South China Morning Post, Wu warned that the Minister “must be careful not to listen to irresponsible academics who peddle baseless rumors to harm China. Maritime trade and economic activity between our ports is a lucrative activity for Belgium which must be respected if it intends to continue”. Chinese diplomats also warned that the comments from Minister Lahbib could jeopardize bilateral trade.

The South China Morning Post adds that the Chinese Embassy in Belgium did not respond to a request for comment. There is debate in Europe about Chinese investments in critical maritime infrastructure as Germany approved a 24.9% investment by Cosco in its busiest container port terminal in Hamburg – despite warnings from six ministries and the European Commission that it could be a national security risk. Defenders of the deal point to the reduced ownership stake Cosco was permitted to take. At less than 25%, it can have no voting rights according to German law. But experts are warning that the company’s efforts to assemble such assets around Europe makes governments less willing to speak out against China when necessary, with the cumulative impact being a dilution of EU foreign policy.

As well as its assets in Belgium and Germany, Cosco, the world’s third-largest shipping company and fifth-largest port terminal operator, also holds minority stakes in ports at Las Palmas in Spain’s Canary Islands, Rotterdam in the Netherlands, and controlling stakes in container terminals at Bilbao and Valencia, also in Spain. Cosco has a stake in Greece's Pireaus port since 2009.

Other Chinese state companies also own port assets across Europe. Through a joint venture with the French shipping giant CMA CGM, the state-owned China Merchants Group (CMG) owns stakes in 13 terminals worldwide. These include Antwerp-Bruges (Belgium), Montoir, Dunkirk, Le Havre, and Fos in France, Thessaloniki (Greece) and Marsaxlokk (Malta). But CMG is not a container shipper, and thus cannot direct container traffic in the way Cosco can, the South China Morning Post reports.