Ninety percent of the world’s trade is shipped by sea, bringing finished goods, components, and commodities to markets around the globe. But maritime trade is not only critically important—it’s also fragile, easily disrupted by pandemics, port bottlenecks, or large ships getting stuck in canals. While maritime embargoes during wartime have been a staple of conflicts since the days of the Spanish Armada, today’s warfare won’t require a flotilla to keep essential goods from reaching their destination. Instead, adversaries can paralyze shipping by weaponizing information.
The Chinese government has spent the past three decades trying to gain access and influence in the open seas, strategic shipping lanes, and foreign ports in Asia and around the globe. China owns, co-owns, or operates some 96 foreign ports globally, with its portfolio constantly expanding—most recently in Hamburg, Germany, and the Solomon Islands. Of course, foreign ownership or control of ports and logistics operations is not an intrinsic hazard; companies from the Netherlands, Singapore, and the United Arab Emirates own and operate dozens of overseas ports.
But China’s operations have two additional and problematic aspects. First, China has introduced massive and little-understood information-gathering infrastructure at critical ports worldwide. Second, Chinese laws require that all Chinese companies operating overseas—both private and state-owned—must gather and report intelligence on foreign entities to the Chinese government.
Given Beijing’s increasingly adversarial economic and geopolitical posture toward the West, it is critical that the risks of Chinese infrastructure ownership are fully understood and mitigated. This must begin with understanding exactly what Beijing knows—what data streams it has access to, what information it collects, and what intelligence-gathering is linked to Chinese port operations.
Of the world’s 75 leading container ports outside the Chinese mainland, almost half have at least partial Chinese ownership or operations (with operations more significant, since they allow China to control access to terminals, supplies, dry docks, and storage). More than half of China’s overseas maritime assets sit on major shipping lanes passing through the Indian Ocean (the Port of Hambantota, Sri Lanka), the Red Sea (the Port of Djibouti), the Suez Canal (the Port of Sokhna, Egypt, and the Suez Canal Economic Zone), the Mediterranean Sea (the Port of Haifa, Israel, and Piraeus, Greece), and other waters.
Ranging from small facilities to larger footprints with substantial operational control, this maritime presence opens the door for information-gathering and other strategic activities. China also leads the world in shipping capacity with its vast commercial fleets, including container ships, oil tankers, liquid natural gas transporters, and bulk carriers for coal and grain. The country manufactures more than 90 percent of all shipping containers and 80 percent of the world’s ship-to-shore cranes.
Chinese shipping activities abroad are known to double as outposts for data collection, intelligence-gathering, and surveillance on a massive scale. Many ports around the world use China’s logistical software system, LOGINK, to track a wide range of trade, market, and maritime information, including vessel and cargo status, customs information, billing and payment data, geolocation data, price information, regulatory filings, permits and licenses, passenger manifests, trade information, and booking data.
Chinese-owned ports operate 5G telecommunications towers, and China provides the operating systems for port facility computers. U.S. officials are even investigating China’s shipping cranes as possible spying tools. Beijing’s systematic information-gathering activities could help it pinpoint critical Western trade and supply chain vulnerabilities, as well as track the shipping of military supplies, equipment, and components.
The Chinese navy, already the largest in the world, also benefits from having access to a global web of state-owned ports. Beijing operates only one foreign naval base—in Djibouti—compared to the U.S. Navy’s extensive global network of dedicated ports and joint bases. But Chinese commercial ports routinely host Chinese military vessels and could act as critical resupply points or repair facilities in any conflict. To this end, China is increasingly pursuing civilian-military interoperability in maritime infrastructure and other domains.
At the core of the problem are Chinese leader Xi Jinping’s ever-tighter policies to make all commercial activity serve the interests of the state. China’s port, shipping, and logistics companies are legally required to collect information for the Chinese Communist Party. Conversely, Chinese law also blocks the flow of shipping data, such as vessel location signals, to other countries.
Beijing has also removed the distinction between commercial and military activities. On the contrary: All nominally civilian ports built with Chinese help abroad are designed for potential use by Chinese warships. In addition, Chinese law requires that all civilian-owned assets and operations must provide support to the Chinese military in the event of a conflict. Already, roughly one-third of the ports where Chinese companies have investments have hosted Chinese naval vessels.
China’s control of trade information and port infrastructure provides substantial commercial advantages in peacetime. Given China’s intentional decision to treat all civilian assets as an extension of its powerful military, however, the consequences of this control in wartime could be catastrophic. With virtually all the world’s seaborne goods passing through or near Chinese infrastructure, Beijing could easily leverage the information it accesses in order to selectively seize critical goods, such as medicines; divert or delay military components; or let essential supplies just sit in storage—no naval deployments needed.
China’s maritime strategy, if successful, could give Beijing the capacity to put a selective stranglehold on the international economy—not by seizing ports or blocking the Suez Canal, but simply by controlling infrastructure and information. The United States and its allies should take meaningful action to counter these efforts. If the West’s passivity continues, it could effectively allow Beijing to disrupt or distort maritime flows to and from any country in the world.
Washington should begin by conducting a thorough risk assessment of critical supply chain dependencies—including in agricultural supplies, medical ingredients, military hardware, and other products—that traverse through Chinese-operated ports or vulnerable chokepoints nearby. Washington should then devise mitigation strategies to protect U.S. commercial and military interests. This includes collaborating with allies to ensure that China is not using its control of maritime logistics systems to manipulate, compromise, or weaponize shipping and trade data.
Most critically, the U.S. government needs to recognize global ports and the shipping industry as critical security risks while blunting China’s efforts to exploit its logistics network for spying and other purposes.
Three concrete steps would help improve U.S. and global maritime security:
First, the White House should coordinate a detailed review of China’s multilayered influence on ports and related trade infrastructure and devise strategies to counter it. That includes mapping Chinese ownership and links to sanctioned entities, examining Chinese-made logistics technology, screening security-relevant trade and shipping data, assessing 5G networks, examining cyber risks, assessing risks associated with dual-use infrastructure, and investigating illicit actors and entities associated with critical infrastructure.
Second, the U.S. government needs more and deeper partnerships with the private sector concerning key supply chains. Much like after 9/11, a more collaborative approach to vital security interests is necessary. For example, U.S. Customs and Border Protection’s Authorized Economic Operator program offers preferential treatment for organizations that agree to adopt U.S. requirements that insulate supply chains from terrorist and other security threats.
These programs could be extended to connect the U.S. Department of Homeland Security with private sector companies willing to provide comprehensive trade data to the United States in exchange for expedited processing at the border. This, in turn, could provide a much deeper view into supply chain vulnerabilities and help identify suspicious activities taken by adversaries.
Third, Congress should consider new measures to sanction or remove critical Chinese technology products installed in U.S. ports, and allies should be encouraged to do the same. Current U.S. law does not allow the government to help U.S. ports, let alone foreign ones, decommission Huawei 5G networks or other suspect technology. One possible approach would be for Congress to develop economic incentives and partnerships to modernize port infrastructure in exchange for decommissioning Chinese spyware. To help key allies and partners, the U.S. International Development Finance Corporation could help finance the assessment and modernization of their port infrastructure.
With the global enthusiasm for China’s massive Belt and Road infrastructure projects waning—including the Italian government’s announcement that it intends to pull out of the program—the moment is ripe for a U.S.-led effort to strengthen and protect core maritime infrastructure investments around the world.
None of this is to say that the United States should abandon the economic benefits of maritime trade with China. But Washington needs to understand and address the emerging risks stemming from China’s attempts to dominate maritime shipping and logistics and must take protective steps today.
