China’s blue economy
Farkhund Yousafzai
The world’s population is expected to increase by 2 billion persons in the next 30 years, from 7.7 billion currently to 9.7 billion in 2050, according to a United Nations report. With this mammoth increase in population, nations will need new resources from a finite amount of space to meet soaring human needs and this source can be none other than the sea because 70 percent of the globe is covered by it.
These oceans are simultaneously a source of food, fishing, economic development and energy (oil and gas resources). The seas produce more than half of the oxygen for human consumption, absorb greenhouse gases (harmful to human health and the environment) and regulate global climate as in coastal regions, healthy coral reefs and other wetlands ecosystems safeguard communities from storm surges and flooding events.
Oceans are helping to counteract the uneven distribution of solar radiation reaching the earth’s surface and act as shipping lanes for maritime trade as more than 80 percent of the world’s trade is carried by it. The seas and their ports are important sources for global trade and supply chains and are the primary means of access to global markets for all the countries. So, the future lies in seas’ economy – the blue economy.
China is at the forefront of this blue economy and it is not only promoting maritime trade around the world but also inter-connects the region by its ports, ships, containers and investments in the blue economies of other states, thus strengthening the regional blue economy.
There are two main reasons due to which China is attracted to blue economy. One is internal and the other is external. With a 32,000 km long coastline China has more than 7,300 islands. It owns equal to 3 million km of special economic zones in offshore waters and 1.6 billion cubic meters of gas and 24 billion tons of oil reserves in its exclusive economic zones. China has historically relied heavily on maritime trade and is said to be unable to sustain the growth of its economy without it.
When examined externally as mentioned above, 80 percent of the world’s trade is carried by sea; with the South China Sea, the East China Sea, the Pacific Ocean and the Arabian Sea playing a major role. As China has ensured its full presence in all major sectors around the world as a superpower, its leaders know the importance of the relatively new concept of blue economy and have decided for a leading role here also.
According to Liu Shuguang, a professor of the Ocean University in Qingdao, China, “China’s ocean economy is seen as a driver of innovation that can advance the goal of becoming a maritime power and contribute to the Chinese dream by strengthening the China’s status as a strong nation-state that is internationally respected.”
China’s blue economy strategy has three main components i.e. extensive network of ports, shipbuilding industry and maritime silk road initiative. Its blue economy is not only boosting global maritime trade but also inter-connecting the whole region and giving new dimensions to the regional blue economy. In this area, China seems to be a giant “blue octopus” with a network of ports, ships, containers, and sea lanes throughout the region. To understand it, let’s take a look at just nine of its major ports.
Shanghai Port built along the junction of the Yangtze, Huangpu and Qiantang rivers and flanked by the Hangzhou Bay to the South and the East China Sea to the East is the largest port in the world. Owing to the sheer volume of trade through this port and its effect on the local population, Shanghai has been designated as one of the four large port megacities across the globe.
Its Shenzhen Port, a naturally protected harbor in the Pear River area is ranked third globally in terms of cargo thoroughfare. It works as a feeder port, serves over 50 global shipping lines, has over 130 international routes and services nearly 10,000 vessels annually.
Another mega harbor, Ningbo-Zhoushan Port is connected to 90 countries and 560 ports across the globe. Shipping over 1 billion tons of cargo annually, this is the busiest port globally for cargo. There is a dedicated terminal for processing crude oil which handles supertankers over 250,000 tons and OBO (ore bulk carriers) vessels over 200,000 tons.
Port of Guangzhou trades with over 80 nations and 300 ports. The port is well connected with rail, road, air and inland waterway connections. It lays on the rivers of Dongjiang, Beijiang, and Xijiang and is connected to the industrial hubs surrounding it.
While the Port of Hong Kong receives nearly 0.5 million vessels, over 250 million tons of cargo and above 25 million passengers annually and Port of Qingdao, located on the Yellow Sea, is ranked 8th globally in terms of traffic and is a major seaport in Eastern China. It carries out trade across 130 countries and over 450 ports.
Another giant, Port of Tianjin services vessels from over 600 ports spread over 180 nations. Over 100 different shipping lines run services here, while there are also 60 liners that have operations to Tianjin.
Similarly, Port of Dalian serves 68 major international container routes, while Port of Xiamen serves nearly 500 vessels every month from over 50 countries and has a regular service of 70 routes passing through the top ports from Europe, the Americas, and Africa.
In addition, China is increasing maritime cooperation with several Indian Ocean states. It built two ports, Hambantota Port and Terminal Colombo in Sri Lanka. Hambantota Port is now under Chinese control for 99 years lease. Similarly, China has built two ports in Myanmar, one of them is now shipping oil and gas through a pipeline from Myanmar to Chinese borders. So, in Myanmar, they have not only ports but also they built oil and gas pipelines which are functional.
China has also built Chittagong Port in Bangladesh, Khalifa Port in UAE, Sokhna Port in Egypt, Darwin Port in Australia and Sudan Port in Sudan, while Dar-es-Salaam Port in Tanzania, Doraleh Multipurpose Port in Djibuti, Lamu and Mombasa ports in Kenya are under construction.
Moreover, China is investing in the development and operation of commercial ports worldwide, not just in Asia and Africa, but in more far flung parts of Europe and the Americas. Thus it is connecting the regions and strengthening the blue economy.
Apart from this, shipbuilding industry is the second component of China’s blue economy. It has more than 3000 ships in its fleet and is a major exporter in the industry. According to China Association of the National Shipbuilding Industry, the country’s shipbuilders exported 210,000 dwt (dead weight tonnage) in the first half of 2021.
Furthermore, China’s Maritime Silk Road Initiative has a major role in the strengthening of the regional and inter-continental blue economies. This maritime route built in the South China Sea, the Indian Ocean and the Eastern Mediterranean is connecting Asia with Europe.
In 2016, the first year of this mega project, China spent $20 billion to build seaports and terminals along this sea line. It is creating huge trade prospects between Asia and Europe, leading to increased economic prosperity and employment opportunities. Moreover, China is currently working to develop a major sea route – Ice Silk Road in the Arctic Ocean.
These sea routes are crucial for the development of blue economy, but apart from its success, China’s blue economy creates a serious environmental issue also. Due to its rapid industrial development, the country is already grappling with air pollution and now the massive exploitation of the oceans is polluting the region’s water, affecting the marine environment and causing various ecological complications. It needs to urgently address this issue; otherwise the climate complications will not only affect China but the whole region.
The writer is a journalist and analyst, based in Islamabad. He may be contacted at: farkhundiqbal@yahoo.com.
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