Harbours on the eastern lobe of the Indian Ocean could transform the economic geography of Asia … UNDER British colonial rule Sittwe, or Akyab as it was then called, was one of the busiest ports in Burma, or Myanmar as it is now called. Burma was the world’s biggest exporter of rice and a lot of it was shipped from Sittwe, in Rakhine state. Now the city is more associated with ethnic cleansing; it was the site of murderous riots last year against Muslim Rohingyas. Old rice mills and river steamers are rotting away in the tropical damp, much like the rest of the place—except the port itself.
Now the canal is being reconfigured by a $5.5 billion expansion project scheduled for completion early next year. Approved by national referendum in 2006, the expansion effectively doubles the canal’s capacity by adding a new set of locks to accommodate larger container ships. Chambers with walls 50 feet thick are being grafted directly onto bedrock, like extensions of the isthmus itself. But the construction — monumental as it is — is only a small part of the story. More important is how the Panama Canal expansion is altering logistical relationships and generating new infrastructures throughout the American Hemisphere. ... Almost as soon as the referendum passed, port authorities from Miami to Lima began racing to complete their own expansion programs: dredging deeper shipping channels, installing larger gantry cranes, and building new container yards, in speculative efforts to compete for the ultra-large container ships that will transit the widened canal. An intense wave of anticipation ripples outward throughout the multi-continental network of waterways, ports, inspection stations, railroads, switching yards, highways, warehouses, and distribution centers that enable the global flow and movement of shipped materials. ... The expansion will reconfigure trans-American shipping in three primary ways. 4 First, a higher volume of goods will move faster between the two oceans, decreasing transport costs and altering the delicate financial calculus that determines global shipping routes. Second, as canal traffic increases, there will be a corresponding rise in transshipment, where goods are transferred to smaller ships that service cities with shallower harbors. The canal’s three ports — Balboa, Colón, and Manzanillo — will link distribution centers like Shanghai with smaller hubs like Barranquilla, Colombia, thus increasing Panama’s importance to regional shipping networks. Third, the expansion will provide an attractive alternative for shipping agricultural products from the interior United States to East Asian markets, elevating the Mississippi River corridor relative to the currently dominant overland routes to Pacific ports.
Investments into a vast network of harbours across the globe have made Chinese port operators the world leaders. Its shipping companies carry more cargo than those of any other nation — five of the top 10 container ports in the world are in mainland China with another in Hong Kong. Its coastguard has the globe’s largest maritime law enforcement fleet, its navy is the world’s fastest growing among major powers and its fishing armada numbers some 200,000 seagoing vessels. ... The emergence of China as a maritime superpower is set to challenge a US command of the seas that has underwritten a crucial element of Pax Americana, the relative period of peace enjoyed in the west since the second world war. ... China understands maritime influence in the same way as Alfred Thayer Mahan, the 19th century American strategist. “Control of the sea,” Mr Mahan wrote, “by maritime commerce and naval supremacy, means predominant influence in the world; because, however great the wealth of the land, nothing facilitates the necessary exchanges as does the sea.” ... The five big Chinese carriers together controlled 18 per cent of all container shipping handled by the world’s top 20 companies in 2015 ... The total size of these investments is difficult to calculate because of sketchy disclosure. But since 2010, Chinese and Hong Kong companies have completed or announced deals involving at least 40 port projects worth a total of about $45.6bn
They settled on three investment categories: transportation, energy, and water/waste. Global Infrastructure Partners, founded in May 2006, now manages about $40 billion in assets ranging from ports and pipelines to London’s Gatwick Airport, a liquefied petroleum gas storage facility in Visakhapatnam, India, and a vast wind farm in the North Sea. Over 10 years, GIP has expanded its roster of backers to include some of the world’s biggest sovereign funds and a slate of U.S. pensions. The firm operates three funds. GIP I raised $5.7 billion in 2008. GIP II closed in 2012 with $8.3 billion. In January it announced its latest and largest pool, a $15.8 billion fund, the largest-ever dedicated to infrastructure. ... Fixing deteriorating infrastructure, combined with new projects in the U.S. and in emerging and frontier economies across Asia and Africa, has given rise to a market that Bain & Co. estimated is worth $4 trillion. As many governments face budget shortfalls that curb such spending, private money is stepping in. ... The two recovering engineers marveled at how you could theoretically use a lot of the industrial processes they’d learned at GE to retool an airport. “An airport is ultimately about moving planes, passengers, and bags through a series of steps,” Woodburn says. “That’s a familiar process to people with experience in manufacturing.”