China Expands Reach Into U.S. Critical Infrastructure – China Gains Millions While U.S. Workers May Lose Out

Written By Price Sukhia and Mark Hoekenga 

BALTIMORE – In the latest example of Chinese involvement in critical American infrastructure projects, Baltimore’s Seagirt Marine Terminal is about to receive four huge port cranes produced by a company owned by the Beijing government and tied to the People’s Liberation Army.

The cranes, arriving on the heavy lift vessel Zhen Hua 24, are products of the Shanghai Zhenhua Heavy Industries Company (ZPMC), a subsidiary of the state-owned and P.L.A.- connected China Communications Construction Company (CCCC).

The cranes are expected to be operational before the end of the year and will be used in the $466 million dollar expansion of Baltimore’s Howard Street Tunnel.

Baltimore’s addition of these cranes is just the latest installment of critical infrastructure that relied upon or has been built by Chinese companies across the United States.

In the last three years, both Virginia and Tacoma, Washington have welcomed a total of 14 ZPMC cranes into their ports for similar infrastructural projects, with Virginia expecting more in early 2022. Estimates for similar cranes that arrived in Houston, Texas in 2017 suggest the cranes cost in the neighborhood of $33 million apiece.

In 2011, a subsidiary of the China State Construction Engineering Corporation won a $400 million contract to redevelop the Alexander Hamilton Bridge over Harlem River in New York.

While relying on Chinese companies for development may provide opportunities for cheap labor and materials, it also presents certain risks.

In 2006, ZPMC was contracted by the California Department of Transportation (CalTrans) to rebuild the Eastern Span of the San Francisco-Oakland Bay Bridge, despite the fact that the company had no prior experience in bridge building. There were numerous problems with the construction of the bridge ranging from cracked welds produced by ZPMC workers and several instances of neglect from ZPMC officials, as well as falsified inspection reports and project management issues from CalTrans officials.

What was initially supposed to be a $1.1 billion project completed in 2007 ended up costing $7.2 billion and did not officially open until September 2013. It was the most expensive civil development project in Californian state history. Moreover, the lack of safety standards resulted in even more costs towards maintenance and repairs over the next several years. Ultimately, this cost 3,000 U.S. jobs and an estimated $1 billion to California’s state economy.

But U.S. states and cities that rely on China for infrastructural needs face more than just hidden costs and logistical headaches. Partnerships with state-run Chinese entities present broader concerns that could impact national security.

Last year, Commerce placed CCCC and several of its subsidiaries on its “Entity List” of Chinese companies that pose a threat to U.S. national security. Companies like CCCC have helped China construct artificial islands in the South China Sea that are fortified with air-defense weaponry and anti-ship missile technology, constituting a clear breach of Xi Jinping’s 2015 promise to Barack Obama that China would not militarize islands in contested waters.

CCCC is also the largest contributor to China’s Belt and Road initiative, Beijing’s effort to develop trade and infrastructure across Asia, Africa and Europe. U.S. officials have criticized the Belt and Road program for its predatory posture towards smaller countries over which China seeks to gain leverage and exert political pressure through the use of corruption, environmental degradation, opaque loans, and lack of oversight.

China’s growing influence over U.S. infrastructure threatens the U.S. economy and jobs as well as national security.