China-US Tensions Increase over Trade Lane

 14 Jan 2016     Cargo Volumes and Throughput, Carriers, Global Economy/Trade, Going Places, Politics

China’s military presence in the South China Sea has increased tension with the US as Beijing intends to regulate one of the world’s most important sea lanes, according to Reuters.

The US military remains one of the most dominant naval forces in the region and has cautioned Beijing which seeks to establish a level of de facto control over the South China Sea.

Such a control threatens the freedom of navigation for international shipping.

Beijing upholds its stake to almost the whole of the sea, through which trillions of dollars’ worth of trade pass each year. 

China recently built a new 3,000 metre runway on a reef in the Spartly Islands where its first test flights landed; challenging Vietnam and the Philippines, who also have claims in this region.

Captain Bjorn Hojgaard, Chief Executive Officer at Anglo- Eastern Univan Group, said: "From our point of view, it's just another military base. It's only politics, commercially it makes no difference."

However, China’s dominance in the region is evident through its One Belt, One Road initiative.

Read: China Merchants Strikes Dalian Port Deal

China’s transport infrastructure and regional development trade plans will support the Asia Pacific in retaining the title of being the fastest expanding and most dynamic region in the world economy in 2016; with an increasing amount of trade liberalisation agreements driving the growth.