Home Headline News End Times Update Wars and Threats of Wars Chinese threat: Chinese Company Could Take Over Long Beach Port Despite Trade Dispute

Chinese threat: Chinese Company Could Take Over Long Beach Port Despite Trade Dispute

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A Chinese company may take over the current owner of the biggest U.S. container port in Long Beach, despite President Donald Trump’s threat to slap a 25 percent tariff on $50 billion worth of China’s tech exports.

China’s state-owned COSCO conglomerate is within days of closing its $6.3 billion take-over of Hong Kong-based Orient Overseas Container Lines (OOCL), which owns America’s biggest container ship cargo processing operation in Long Beach, California.

The OOCL paid $4.6 billion to sign a 40-year lease with the Port of Long Beach to develop the Middle Harbor property, which tripled the size of the port’s container capability. The Long Beach container port handles one-fifth of all U.S. container activity. With over 2,000 vessel calls in 2017, OOCL processed 6.8 million 20-foot cargo container units containing $180 billion in goods.

The Wall Street Journal reported in April that COSCO’s takeover of OOCL was being reviewed by the U.S. Treasury Department Committee on Foreign Investment in the U.S. over national security concerns regarding China’s potential dominance of U.S. port trade.

It is not clear that the ongoing U.S.-China trade dispute will affect the national security review.

The Journal noted that COSCO Vice Chairman Huang Xiaowen told a news conference on April 3 that the OOCL deal would close by June: “Up to now we are quite confident to push forward this acquisition. … It’s progressing normally,” he was quoted as saying.

However, the Journal repted that COSCO has “proposed to divest or carve out the Long Beach terminal to satisfy U.S. concerns about the deal.”

Meanwhile, Reuters reported Monday, the U.S. has threatened to slap 25 percent tariffs on a substantial number of China tech exports by June 30, after World Trade Organization dispute settlement talks in Geneva broke down on May 28.

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