China Ocean Shipping Company (COSCO), the fourth largest player in the shipping industry worldwide and linked to the Chinese People’s Liberation Army (PLA) Navy, has been increasing its global presence. “This civil-military fusion [part of China’s national strategy] gives Beijing an extensive logistical network to project its naval power,” Euclides Tapia, professor of International Relations at the University of Panama, told Diálogo on September 30.
In line with this strategy, the state-owned company owns and operates more than 400 container ships and hundreds of other vessels, connecting 558 ports worldwide, Japanese magazine Nikkei Asia reported. Although the Chinese Navy only has one official overseas base in Djibouti, in the Horn of Africa, and a suspected base in Cambodia, it could resupply and receive logistics support wherever COSCO operates.
An example of this occurred in 2019, when the Chinese Navy frigate 054A Linyi was resupplied by the COSCO container ship Fuzhou, allowing the ship to conduct operations into the high seas. COSCO not only provide support to PLA Navy’s escort and evacuation operations, it also helps resolve logistics and supply issues in waters outside of China’s jurisdiction, maintaining ties with key entities in China’s defense system, including its Central Military Commission, notes Nikkei Asia.
According to Chinese financial platform Caixin Global, COSCO plans to add close to 100 new vessels to its fleet, including bulk carriers, tankers, and general cargo vessels. Similarly, China Merchants Group will also add around 100 ships to its fleet, while CHN Energy Investment Group is looking to expand mainly its bulk carrier fleet.
“Beijing projects the image of having no foreign military bases, but this is misleading,” Tapia said. “Its plan focuses on creating a network of ports and global strategic services, Latin America included, which under commercial pretext, serve as logistic bases with military potential, threatening regional and global security.”
“Door-to-door”
In June, COSCO launched a new direct service between Asia and Mexico to expand its “door-to-door” coverage. This weekly service connects ports in China, South Korea, and Japan, with Ensenada, Manzanillo, and Lazaro Cardenas in Mexico. This is in addition to the transpacific services between Asia and the west coast of Latin America, which the shipping line has operated for several years, Mexican magazine T21 reported.
The Chinese state-owned shipping line also introduced on March 27, a direct connection between Chile, Peru, Ecuador, Colombia, Central America, and the Caribbean, making a huge breakthrough in Latin America, the India Shipping News platform reported on March 24. Currently, the Chinese shipping line operates 27 regional shipping services, covering 24 countries and 52 ports in North and South America.
“It is surprising that Latin American countries do not perceive that these projects could become espionage bases,” Tapia said. “China is moving forward strategically to strengthen its global position.”
New maritime order
Tapia highlighted that Beijing does not value geopolitics in the same way as the West; its focus is on leveraging its commercial and diplomatic influence in the world, always according to its own geostrategic interests. “China, through COSCO, seeks to dominate the world and create a new maritime order,” he said.
The August 17 report Maritime Maneuvers: China’s Hidden Quest for Oceanic Supremacy, by European journal Modern Diplomacy, says that China’s oceanic ambitions seek to redefine the order of the world’s seas, challenging Western influence and asserting its presence in contested waters and strategic routes, in line with its superpower ambitions.
This maritime policy encompasses various aspects such as military, economic, technological, and political dimensions, Modern Diplomacy indicates. China, through this strategy, “seeks to expand its economy and strengthen its armed forces, hand-in-hand with the People’s Liberation Army and the Belt and Road Initiative,” Tapia said.
To advance its plans without alarm, Beijing expanded its naval presence under the pretext of protecting its economic interests from piracy and other threats, justifying the move as necessary for its security, Modern Diplomacy reported. Chinese tactics such as strategic assertion, legal warfare, and naval development show its ambition to dominate the oceans.
Chancay Port
In this context, the first phase of the Chancay Port Terminal in Lima, Peru, a project financed and built by COSCO under the Belt and Road Initiative, will be completed in November. The Chinese shipping company is expected to begin port operations in early 2025.
A deep-water port such as Chancay, however, arouses suspicions that it can serve as a military base for logistics support operations, resupply, and repair of warships. Given the close ties between COSCO and the Chinese government, Chancay is likely to be used for military purposes in the future, the U.S. Institute of Peace says it its China in Peru report.
According to the report, Peruvian elites appear to underestimate the geopolitical risks associated with this project, possibly due to a lack of understanding of the nature of Chinese state-owned enterprises and their relationship with the Chinese government.
The report also highlights that control of strategic ports is key to China’s expansion. COSCO, as a state-owned company, is mandated to submit to the will of the communist regime and fulfill national objectives, including military ones. According to the Strategist, an analysis site of the Australian Strategic Policy Institute think tank, “COSCO operates its own militia, which is likely capable of conducting paramilitary activities such as maritime surveillance, counter-piracy missions, and search and rescue operations […]. COSCO appears to be developing the capability needed to comply with the Chinese Communist Party requests to assist with intelligence operations, national defense mobilization, or grey-zone activities.”
“The impact of Chancay in an eventual armed conflict would be catastrophic. We cannot overlook the alliance between China and Russia, as global ports and routes would not only have civil-military use for China, but also for its Russian ally,” Tapia said. “This factor is crucial and must be considered in any strategic analysis of the influence of these powers in the region.”
“El Salvador is another strategic point for China to establish maritime connections in the Pacific, as well as rail and land connections, complementing its influence beyond the Panama Canal,” Tapia added. “This country is key for Chinese interests, which have large-scale investments planned in its territory, thus consolidating its future presence in Latin America.”
In addition, China’s growing military presence in the South China Sea, in defiance of the United Nations Convention on the Law of the Sea, generates instability in the region. This militarization, along with the erosion of international maritime norms, poses serious threats to global maritime security, Modern Diplomacy noted.
For Tapia, China’s maritime expansion, especially through COSCO, represents a serious threat to global stability. Chinese ports in Latin America could be used as levers to influence local conflicts, undermining the rule of law. “In other words, we could see the picture of the South China Sea in the region,” Tapia concluded.
