Major Lindsey Madero, USA

https://doi.org/10.21140/mcuj.20221302005

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Abstract: This article examines how China’s twenty-first century Maritime Silk Road impacts U.S. national security. While the literature frequently discusses the Belt and Road Initiative, the Maritime Silk Road and its impact on U.S. national security is notably lacking. This article examines the specific impacts on the U.S. Department of Defense and other government departments and agencies. The main findings reveal that the Maritime Silk Road is a U.S. national security concern because it degrades operational security, alters military force projection, and bypasses ethical procurement norms. The author articulates the importance of U.S. action in response to China’s global port influence, as well as recommends ways to counter each threat China imposes on the United States through the Maritime Silk Road.

Keywords: operational security, surveillance, force projection, international norms, procurement

 

The maritime domain continues to display its importance as countries around the world enhance their capabilities in a global race to impact sea control and power projection. China’s twenty-first century Maritime Silk Road impacts multiple geographic combatant commands as well as the U.S. Transportation Command’s (USTRANSCOM) ability to project forces through military sealift. China’s increasing support to global maritime infrastructure directly impacts the U.S. Department of Defense and several other government departments. This article argues that the Maritime Silk Road is a U.S. national security concern because it degrades operational security, alters military force projection, and bypasses ethical procurement norms. The article examines the history of the Maritime Silk Road and provides the current and desired future states for foreign port surveillance against the United States, U.S. Navy port access for power projection, and China’s procurement practices compared to international norms. The article additionally provides recommendations on alternative U.S. sealift and financial options, enhancing military lethality and intelligence sharing, and maintaining strong international relationships under an ethical framework.

 

Background

President Xi Jinping announced China’s Belt and Road Initiative (BRI) in 2013. China designed the Maritime Silk Road (MSR), under the BRI, to connect China to Europe for trade purposes. With the Indian Ocean alone hosting 80 percent of Chinese imported oil and 95 percent of Chinese trade with the Middle East, Africa, and Europe, China prioritized port infrastructure projects to bypass choke points and increase trade route options.¹ The Maritime Silk Road created ports, enhanced existing infrastructure, and financed maritime projects with the incentive for the host nation being an increase in tourism and economic growth. There was an initial mixed, global response to the MSR. In 2017, the international community became skeptical of China’s economic diplomacy when Sri Lanka leased the Hambantota International Port to a Chinese company for 99 years in exchange for $1.12 billion.² Even though Sri Lanka used the money to strengthen their foreign reserves and was therefore not a victim of “debt diplomacy,” news outlets suggested that China intentionally created a loan agreement that would result in a payment default.³ In 2018, Vice President Michael R. Pence further elevated the debt diplomacy narrative when he stated, “just ask Sri Lanka, which took on massive debt to let Chinese state companies build a port of questionable commercial value. Two years ago, that country could no longer afford its payments, so Beijing pressured Sri Lanka to deliver the new port directly into Chinese hands.”⁴ After the Hambantota Port deal, Chinese official media reported “another milestone along [sic] path of #BeltandRoad.”⁵ That behavior suggested that China’s MSR intentions were to expand global influence by controlling critical infrastructure.

 

Map 1. China’s Maritime Silk Road global influence

Source: courtesy of the author, adapted by MCUP.

 

Chinese companies initially announced their intentions to invest in nine overseas ports, with the majority located in the Indian Ocean.⁶ Today, MSR port influence expands globally and ranges from Chinese port construction or financing to majority port ownership. MSR contract details are often difficult to obtain, which presents a unique challenge when compiling data on foreign ports with Chinese influence. Also, if MSR nations refinance their loan plans with China in the future, the potential exists for China to increase their ownership or operational control of those foreign ports as a part of the refinancing agreement. Likewise, if a nation defaults on the loan repayment, China may control majority ownership over the port, such as in the case with Sri Lanka. For these reasons, China’s international port ownership and/or influence continues to change.

Since announcing the MSR initiative, several friction points such as territorial claims in the South China Sea, espionage by China in the United States, and Chinese human rights violations compounded to create a fractured diplomatic relationship between the United States and China. In response to China building artificial islands and military outposts in the South China Sea in 2018, the U.S. Department of Commerce barred American companies from exporting to Chinese companies involved in the South China Sea construction.⁷ After Chinese theft of U.S. technology in the same year, the United States increased tariffs on Chinese imports, to which China responded with their own retaliatory sanctions.⁸ In 2018, the National Defense Strategy identified China as “a strategic competitor using predatory economics to intimidate its neighbors while militarizing features in the South China Sea.”⁹ In late 2021, the United States then sanctioned Chinese imports, restricted visas, and imposed investment restrictions against a Chinese surveillance company for enabling human rights abuse against Muslim ethnic minority groups.¹⁰ While these examples depict the diplomatic strain between the United States and China, the MSR also impacts the U.S. military.

 

Concern #1: Degraded Operational Security

The Current State

China previously required surveillance cooperation as a part of MSR agreements, and they will likely continue this strategy with future projects. During negotiations for the Hambantota Port, China required Sri Lanka to share intelligence as a part of the deal.¹¹ While the specific details of the intelligence support are publicly unknown, one can assume that China had interest in foreign vessel capability, port call frequency, and port call tactics used by foreign nations. China also manages surveillance facilities at the Cocos Islands, deep in the Bay of Bengal, to observe foreign naval movement throughout the bay and monitor India’s missile testing.¹² As China gains influence and control over international ports used by the U.S. military, operational security concerns increase. Since 2011, U.S. Marines have been using Australia’s Darwin port on a rotational basis for training.¹³ China acquired the port in 2015 on a 99-year lease, which created tension between the United States and Australia.¹⁴ In 2019, Australia announced they would build a new port for American use at Glyde Point.¹⁵ The new port is likely to reduce U.S. security concerns with China, but not every nation will build separate infrastructure. If China owns a berth, controls the port, or holds port stake, they are likely collecting information on countries operating in or near the facilities. While this strategy is not unique to China, the U.S. military must still be aware that Chinese companies likely have the means and motive to collect against them.

China currently tests the U.S. military’s operational security in Djibouti, where both nations operate a military base. Djibouti is a strategic location, resting on the Bab el-Mandeb Strait, which is one of the choke points in the Indian Ocean. Shipping lanes from Africa, Asia, and Europe converge here and tension exists between the U.S. Navy base and the People’s Liberation Army Navy (PLAN) base.¹⁶ Friction occurs because the bases are extremely close together and one international airport means all militaries are using the same facility.¹⁷ The current accommodations provide China with opportunities to collect intelligence on U.S. forces and allies, like France and the United Kingdom. In 2018, commanders at the U.S. naval base in Camp Lemonnier, Djibouti, claimed several accounts of Chinese personnel attempting to collect information on U.S. military operations.¹⁸ Likewise, China has made several claims against the United States for surveilling their operations in Djibouti.

 

Desired Future State

The desired future state is for U.S. military forces to enhance operational security while accessing ports throughout the Indian Ocean. This implied end state derives from the description of the strategic environment in the 2018 National Defense Strategy as well as the required environment for USTRANSCOM to successfully conduct military sealift. There are a few obstacles that impede the United States from achieving the desired future state. The first obstacle is the covert tactics that China uses to collect information. As previously stated, China influences port operations in the Indian Ocean through operational control, port ownership, and economic and diplomatic relationships with MSR nations. China’s port influence provides opportunities to surveil foreign nations during port calls. The host nation may surveil U.S. forces and provide the intelligence to China, whether willingly or because of coercive influence techniques. The second obstacle impeding the United States from achieving increased operational security is Chinese intelligence collection platforms. China’s cargo-data system, called Logink, is a network that tracks shipments throughout China and giant ports globally.¹⁹ The digitized cargo data provides China with a way to monitor equipment moving around the world, including military equipment moving through commercial ports.

To reach the desired future state, the United States can take several actions to improve operational security. The first action is to enhance relationships with U.S. partners. If the United States is using the ports from a partnered nation, there is an element of trust between the two nations. The concern is that some countries support the United States through partnerships while simultaneously supporting China through the Maritime Silk Road. The United States expects the host nation to deter foreign surveillance. To receive that level of security and deterrence support, the United States must build stronger relationships with partnered nations. Specifically, the United States can reallocate foreign assistance to incentivize partners through cash transfers, training courses, research projects, or debt relief. In addition to economic incentives, the United States can use diplomacy with other nations to describe the benefits of safeguarding sensitive data by denying the use of systems like Logink for military equipment tracking.

The second action the United States can take is to improve the military’s operational security measures at the tactical level. Information sharing, whether intentional or not, is an extreme risk to the force. Operational security degrades as soon as sensitive information is publicly released. To suppress the release or distribution of essential friendly information, tactical military units must impose strict operational security measures and consider the risks during planning. The third action is to develop and use defensive capabilities that can deny surveillance and information collection. China will likely know when the U.S. Navy or commercial vessels move through MSR ports but employing defensive measures can reduce the transparency of U.S. port call procedures. The fourth action is to conduct counterintelligence from the tactical to the national level. These operations identify China’s intelligence collection tactics and conduct security activities to counter foreign threats.

 

Risk

There is a significant amount of risk if the United States does not respond to China’s growing surveillance threat. If the United States does not attempt to increase operational security, China will better understand U.S. port operations. With that knowledge, China can exploit the U.S. military and predict movement timelines, resupply operations, and organic security. To reduce the risk and potential harm to U.S. forces, the United States must maintain international relationships, enforce operational security at the tactical level, and enhance defensive capabilities for counterintelligence operations.

 

Concern #2: Force Projection

Current State

Force projection is the military’s ability to project power. The U.S. Navy’s Military Sealift Command (MSC), in support of USTRANSCOM, moves more than 90 percent of military equipment and supplies by sea.²⁰ The MSC “is the leading provider of ocean transportation for the Navy and the rest of the Department of Defense, operating approximately 125 ships daily around the globe.”²¹ The United States also has several redundancies to move military equipment via sea, including USTRANSCOM, the Department of Transportation, and U.S. flagged commercial ships. These redundancies provide opportunities to surge equipment into a foreign theater.

Currently, the United States can project forces into the Indian and Pacific Ocean region, but China’s influence could limit the U.S. military’s ability to access foreign ports in the future. During a congressional hearing in 2019, leaders discussed the potential for the U.S. Navy to face “restricted access to important maritime chokepoints and supply routes” as well as general competition for access to ports.²² In 2019, China denied several requests from U.S. Navy warships to call at Hong Kong.²³ While this example is within China, a similar approach of denying port call requests may surface where China owns or operates foreign ports. Another concern is the increased maritime traffic caused by Maritime Silk Road projects. China’s creation of a new container terminal in Port Khalifa, United Arab Emirates, will likely increase port traffic and may delay the U.S. Navy in the future.²⁴ Traffic directly impacts the U.S. Navy’s timely ability to resupply and repair vessels.²⁵ Disruption of U.S. naval operations may occur in the future from the PLAN as well.

The PLAN is the largest naval force in the world, with more than 300 ships.²⁶ The PLAN is focusing on blue water capable warships and creating opportunities in the northern Indian Ocean and South China Sea to sustain their naval fleet.²⁷ Additionally, China conducts military exercises with commercial vessels, violating international norms and creating increased risk for foreign commercial vessels traveling through the South China Sea.²⁸ The PLAN has several limitations to include air defense, anti-submarine capabilities, logistics, and the inability to sustain a carrier strike group in the Indian Ocean.²⁹ By increasing port control through the Maritime Silk Road, the PLAN enhances sustainability and extends operational reach. The ports in Gwadar and Hambantota are examples of locations where the PLAN could leverage refueling or docking as a part of the Maritime Silk Road.³⁰ In this sense, the PLAN uses the MSR to increase operational reach.

U.S. allies and partners collaborate to mutually support freedom of navigation and deterrence against China in the Indian and Pacific Ocean. The United States is currently involved in multiple international organizations that promote security and freedom of navigation. The Combined Maritime Forces is an example of U.S. commitment to international rules and unified effort. The United States is one of 34 nations involved in the Indian Ocean who combat illegal actions while maintaining security and prosperity for international trade.³¹ The United States is also one of eight nations in the International Maritime Security Construct who ensure freedom of navigation and continuation of trade in the international waters of the Middle East region.³² Additionally, the United States permanently stages military forces on the British-owned island of Diego Garcia. The ability to use that strategic location enables U.S. force projection into multiple combatant commander area of responsibilities. American and British forces also deter Chinese aggression in the South China Sea through joint military exercises.³³ India is another strategic partner that the United States relies heavily on for intelligence sharing, foreign military sales, and naval escort operations through the Malacca Strait.³⁴ The U.S. relationships with the United Kingdom and India are extremely important to counter the negative impacts to force projection because of their aligned national objectives of deterring Chinese aggression.

While many partnered nations have aligned interests, not all partners maintain the same view toward China. Some countries are partners with the United States while they simultaneously support the Maritime Silk Road. An example of this is the relationship between the United States and Sri Lanka. In 2017, a Chinese company paid $1.12 billion for a 99-year lease of the Hambantota Port, along with majority ownership.³⁵ Two years later, the U.S. and Sri Lankan military conducted a Joint naval exercise as a part of the Cooperation Afloat Readiness and Training through the Hambantota International Port.³⁶ With majority ownership of Hambantota, the possibility exists for China to interfere with future operations that rely on the port’s access.

 

Desired Future State

The desired future state is for the United States to enhance foreign port access and maintain redundancies for force projection. This implied future state derives from the requirements of USTRANSCOM and the U.S. Navy to access international ports. China’s increasing port control and influence techniques are obstacles impeding this desired future state. Based on data from the U.S. Foreign Corrupt Practices Act enforcement actions, China contained the highest concentration of bribery.³⁷ In 2009, the World Bank barred the Chinese Harbour Engineering Company from engaging in infrastructure projects due to fraud and the company later offered bribes to government officials in Bangladesh in support of the Maritime Silk Road.³⁸ In general, “60% to 87% of Chinese firms said they had paid a ‘tip’ or bribe to obtain a license in connection with business transactions in Africa.”³⁹ A low income African nation accepting a monetary bribe is not surprising. What is surprising is the percentage of Chinese firms admitting to bribery when commercial bribery under PRC Criminal Law holds entities liable who commit bribery, even outside of China.⁴⁰ It is challenging for the United States to compete with bribery, while supporting international norms and maintaining ethical business practices.

To reach the desired future state, the United States can enhance relationships with partners and allies. While the United States already has strategic partners and engages in information sharing and military exchanges, the continuation of unifying nations with diplomatic values who support international norms is imperative. Through multinational exercises, intelligence support, training opportunities, and other joint efforts, the U.S. and partnered nations can become more unified to counter Chinese MSR expansion. The United States could also leverage the U.S. Agency for International Development to support economic growth in developing nations and offer alternative options to the MSR. While the U.S. Navy will continue relying on foreign ports for force projection, strong relationships with foreign nations enable multiple options for U.S. port access and strategic basing.

 

Risk

If the United States does not act to enhance force projection, the military risks losing operational tempo. With reduced port availability and/or increased port threats, timelines will likely extend for transporting military equipment from ports of embarkation to ports of debarkation. There are also risks if the United States takes action to reduce the impact on force projection. Increasing security cooperation, growing financial aid packages, and/or enhancing naval lethality all require significant funds. While all three actions are important to maintain international relationships and secure foreign port use, the military budget may not support all actions simultaneously. The United States continues to analyze and adapt foreign assistance through the Department of State and Department of Defense.

 

Concern #3: Violating International Norms

Current State

Organizations like the World Bank Group and the United Nations create an international norm for investment and procurement processes. The International Bank for Reconstruction and Development (IBRD), under the World Bank Group, offers loans and developmental assistance for low- to middle-income countries. IBRD, supported by multiple countries, uses rigorous formal steps to ensure fair and reasonable loans for the receiving nation. IBRD ensures their projects are “economically justified,” reinforcing the intent of the World Bank to support developing nations.⁴¹ Additionally, projects must assist with reducing poverty in the host nation and encourage sustainable economic growth.⁴² This standard shows how the bank considers the host nation’s financial situation, beyond the initial loan. Also, the World Bank provides transparency on their international support, unlike the hidden details of MSR loan agreements. China’s success in MSR loan agreements and procurement practices reduce the international appeal to conform to the strict and fair processes used by the World Bank. As the largest shareholder in the World Bank, U.S. preferences impact the bank’s decision making. If more nations seek Chinese financial support instead, U.S. influence may decrease.

Besides the World Bank, the United States is also a member of the International Monetary Fund (IMF) along with 189 other nations.⁴³ The IMF provides exchange rate stability as well as economic, financial, and legal support.⁴⁴ China and the United States became members of the IMF in 1945 and the United States is currently the largest shareholder.⁴⁵ The IMF surveils global economics and standards of living to assess the requirements for or effectiveness of IMF support.⁴⁶ The surveillance is extremely important because it displays the IMF system for collecting information, conducting analysis, and making decisions that enhance future economic stability or quality of life. Because the United States and China are members of the IMF, there is little room to leverage the IMF toward projects or support that only favors one of the nations. The United States could be more successful in countering Chinese bank support to MSR nations by providing independent options or coordinating with partners and allies to present alternative options.

Meanwhile, China is the largest shareholder of the Asian Infrastructure Investment Bank (AIIB), which focuses on Asian nation economic development and infrastructure projects.⁴⁷ Some nations believe that AIIB acts on behalf of China because China controls half of the voting shares.⁴⁸ The United States previously questioned AIIB’s standards and safeguards but despite the concerns, many allied nations are members of the bank.⁴⁹ To quell these concerns, AIIB frequently conducts joint ventures with the World Bank.⁵⁰ The BRI listed the AIIB as a financier and the bank competes with the Asian Development Bank and the World Bank.⁵¹ As a baseline and global standard, the World Bank’s environmental and social framework contains eight areas of analysis.⁵² In comparison, the AIIB only imposes specifications on resettlement and indigenous people, increasing the risk potential for people and the environment.⁵³ As of late 2021, the AIIB updated their environmental and social framework, reducing vulnerabilities pointed out by external parties.⁵⁴ With an enhanced framework and global reach, the AIIB is a competitor to other multilateral development banks (MDBs) with U.S. involvement and interest.

Regarding MSR financing, China is more likely to use the China Development Bank and the China Export-Import (EXIM) Bank, which are institutional banks that implement the state policy.⁵⁵ State-owned banks are less scrutinized and do not require the democratic voting methods displayed in MDBs. The China Development Bank, for example, is “China’s largest bank specialized in medium- and long-term lending and bond issuance.”⁵⁶ State-owned banks may provide China a faster way of approving and providing loans to developing nations. For some nations, the reduced timeline is more beneficial. For these reasons, Chinese banks may appeal more to lower- and middle-class nations seeking immediate financial support. Currently, lending for the Belt and Road Initiative is greater than all combined efforts of MDBs, which includes the World Bank.⁵⁷

A noticeable difference between the United States and China involves MDBs. The United States is a member of five MDBs, but they are not involved in subregional MDBs like China.⁵⁸ Commitment to a subregional MDB may provide personal appeal to a country within that region seeking financial support. Additionally, a nation participating in MDBs and subregional MDBs may claim higher levels of support through the global reach of their bank investments. With that being said, the United States is still the “largest shareholder of global and regional MDBs.”⁵⁹ China’s loan process and contract requirements are vastly different from MDB norms. If a supported country makes national policy or legal changes, China can terminate the supporting contract and demand immediate repayment of a loan.⁶⁰ This locks a host nation into operating under the status quo, without the ability to adapt and change. Another difference with “government-to-government lending,” as opposed to an MDB, is that if the host nation does not reelect “the preferred China incumbent,” China can cancel their loan.⁶¹ This scenario gives China enormous power to expand their influence globally and can lead to the host nation using manipulation and corruption to shape the political outcome.

As a counter, “China’s debt risk is performing at US $1 billion for every US $142 billion in BRI assets, meaning a 1-142 chance of problems” with BRI loans.⁶² This data suggests that China is very successful in creating loans that ensure the host nation does not default. While it may be true that China’s loans are well structured to ensure a successful return, the data does not show the level of Chinese influence and manipulation. As mentioned previously, China’s ability to influence foreign politics through economic agreements shows a tremendous amount of control and manipulation to achieve personal gain. Also, the World Bank’s rigorous process for creating loan agreements may result in the decision to deny a loan to a developing nation because the forecasted projection does not support economic growth. The World Bank exists to create a better standard of living and ensure sustainable growth, resulting in more selective investment decisions. China’s banks do not use the same rigorous processes, meaning they can offer loans faster to countries supporting their national agenda. This makes it difficult for the World Bank and other international banks to justify high standards focused on assessments impacting the environment and social well-being, all while denying corrupt behavior.⁶³

One of the biggest violations of international norms is China’s current contractor bidding process. The international norm is to award the contract to the local firm “if the bid does not exceed the lowest foreign bid by a specified percentage (often 15).”⁶⁴ MDB projects, for example, favor local contractors 40.8 percent of the time, with the remaining percentage awarded to other national bidders.⁶⁵ In comparison, China wins the contracts for the Maritime Silk Road 89 percent of the time.⁶⁶ That leaves both local and foreign countries to compete for the contracts only 11 percent of the time. Additionally, China denies some nations from bidding, creating an unfair and unequal bidding process.⁶⁷ Sometimes China even enforces a closed bidding, and the host nation must select the construction company that supports China’s national agenda.⁶⁸ An example of this is the procurement for China-Pakistan Economic Corridor projects, where the EXIM Bank restricted bidding to Chinese contractors.⁶⁹ When China controls the contractors, they deny the host nation with the complete project details, creating a further dependency on China in the future to provide maintenance and technical assistance.⁷⁰

While China’s bid rigging disregards international norms, it does not violate international law because China is not a member of the Organisation for Economic Co-operation and Development (OECD), which promotes economic and social well-being.⁷¹ China does have laws stating, “No unit or person may illegally restrict or exclude legal persons or other organizations from other areas or systems to take part in bidding or interfere in tender and bid activities in any form” and that bidders may not use deceptive methods for winning.⁷² These laws only apply for “tender and bid activities in the territory of the People’s Republic of China,” which does not impact Chinese infrastructure projects overseas.⁷³ China is a charter member of the United Nations (UN), and the UN expects member nations to support the UN’s guiding principles. The UN Convention against Corruption enforces international standards and the Model Law on Public Procurement states that “all procedures are subject to rigorous transparency mechanisms and requirements to promote competition and objectivity.”⁷⁴ The Model Law aims to assist other nations in developing procurement law and is therefore not an enforceable law against China. The UN can apply pressure on China for violating international norms, but China is not violating international laws. Laws and procurement frameworks in the OECD and the World Bank do not guide China’s financial decisions, enabling China to create a new financial norm through MSR projects.

Out of the 178 agreements in the BRI in 2018, more than 50 percent of host nations did not have government procurement provisions, while another 33 percent had provisions that were so unspecific, they were not enforceable.⁷⁵ China is selecting countries for the Maritime Silk Road that offer a strategic advantage with the geographic positioning of the ports, as well as nations that China can influence. With most agreements made with countries that have no enforceable procurement laws or standards, China controls the procurement process. In 2019, the U.S. House of Representatives Committee on Transportation and Infrastructure documented that “non-Chinese companies will compete for BRI contracts on an uneven playing field and participate in projects on Beijing’s terms.”⁷⁶ Three years later, it appears that China’s power and influence continues to create an unequal procurement process that bypasses international norms.

 

Desired Future State

The desired future state is for the United States to reduce China’s success in bypassing international procurement norms. The inverse is for the United States to reinvigorate the use of international norms for investments and procurement to solidify those practices as preferred business models. This implied future state derives from the requirement of the United States to remain competitive and counter actions that reduce U.S. economic effectiveness. If China adjusts the international norms through their global influence, the United States must evolve to fit the new standards or risk experiencing a competitive disadvantage. The obstacle impeding the United States from achieving this future state is China’s influence tactics that play to the personal appeals of the low- to middle-class countries. Countries who are eager or desperate to enhance their standard of living through the economy are likely to request a loan from China as a part of the Maritime Silk Road. In some cases, countries agree to infrastructure development or port expansion with the promise of increased tourism and economic growth. By coordinating with China, the host nation’s current and forecasted economic growth are less scrutinized as a part of the loan development process. Also, the loans supporting the MSR are coming from one country, as opposed to the World Bank. This allows China to quickly decide if investing in a nation is a part of their national interest.

To reach the desired future state, the United States can enhance relationships with partnered nations. If a country is receiving security force assistance or economic relief from the United States, they may be less inclined to support China through the MSR. The second action the United States can take is to increase global information sharing. As a member of the World Bank, the United States can increase awareness of international procurement practices and educate others on effective techniques. This would reduce the number of countries who do not have existing or enforceable government procurement provisions. The third action the United States can take is to offer alternative options for financial and advisory support, as discussed later under recommendations. Such options would require sustainability, efficient processes for loan selection, and fair procurement practices.

 

Risk

If the United States does not react to China bypassing international norms, China will continue to spread their influence globally and create a new standard for the loan and procurement process. The discriminatory procurement practices exhibited by China may lead other nations to conduct business in a similar manner. There is also risk associated with the United States reacting to Chinese business practices. If the United States reduces the success of China’s MSR investments by proposing alternative investment options and educating countries on government procurement provisions, China could respond using information operations. China would likely spread the message globally that the United States is attempting to control the procurement process internationally by training others to their own standard. The United States can combat these messages through transparency and proof of concept from successful business practices used by the World Bank.

 

Recommendations

The Interim National Security Strategy Guidance stated, “We will confront unfair and illegal trade practices, cyber theft, and coercive economic practices that hurt American workers, undercut our advanced and emerging technologies, and seek to erode our strategic advantage and national competitiveness.”⁷⁷ This guidance clearly states that the United States will respond to coercive measures, as previously described through China’s bribery tactics and bid rigging. While Chinese attempts at surveilling U.S. military operations are not new, the United States must continuously adapt to maintain the competitive advantage. To do so, the author recommends exercising sealift redundancies, strengthening partnerships, creating alternative investment options, enhancing U.S. force lethality through research and development, supporting increased global awareness, and maintaining our ethical framework.

 

1. Sealift Redundancies

The United States currently has several redundancies for military sealift as well as prepositioned stock afloat. The U.S. Navy, in support of USTRANSCOM, moves most of the military equipment, but the Department of Defense, U.S. flagged commercial volunteers, and vessels in the Voluntary Intermodal Sealift Agreement are designated as alternative options. To increase readiness, those parties are working together through training scenarios. In 2021, “DoD, the Department of Transportation’s Maritime Administration (MARAD), commercial sealift carriers, and maritime labor” conducted a tabletop exercise, reenacting the requirement to use commercial ships in support of the Department of Defense (DOD).⁷⁸ Even if China’s influence does not close ports to U.S. access in the future, the DOD may still require commercial ships to move the large equipment volume in a crisis or contingency. Military Sealift Command has 17 prepositioned ships globally to support all branches of the Services.⁷⁹ While the prepositioned assets are essential for surging forces into a theater, the sustainment is for immediate and short duration. With sealift redundancies currently established, the United States must continue to exercise all alternate capabilities to increase readiness.

 

2. Partnerships

Guidance from the U.S. president, secretary of defense, chairman of the Joint Chiefs of Staff, and combatant commanders identified the requirement for strong alliances and partnerships. The Interim National Security Strategy Guidance stated that between our partnerships and making smart defense investments, “we will also deter Chinese aggression and counter threats to our collective security, prosperity, and democratic way of life.”⁸⁰ The National Military Strategy listed several mission areas including “reassur[ing] allies and partners and compet[ing] below the level of armed conflict.”⁸¹ Admiral Philip S. Davidson added to the importance of partnerships when he stated, “Persistent presence through forward-based and rotational joint forces is the most credible way to demonstrate our commitment and resolve to potential adversaries while simultaneously assuring allies and partners.”⁸²

The United States conducts global security cooperation and collaboration with partners and allies. Fusion centers are a way in which partners share information and combat national threats. The United States is currently a member of a fusion center that synchronizes efforts by Singapore, Australia, New Zealand, and other Association of Southeast Asian Nations to focus on countering terrorism.⁸³ Fusion centers like this will initially build collaboration and then continue to refine and enhance capabilities that are more focused on threats from nation-state threats, such as China. The United States is also a member of the Quadrilateral Security Dialogue (or the Quad), along with Japan, Australia, and India. The Quad convened for the fourth time in May 2022 to welcome the new joint initiative of “Indo-Pacific Partnership for Maritime Domain Awareness (IPMDA).”⁸⁴ The Quad Infrastructure Coordination Group also synchronizes national strategies to coordinate each nation’s financial efforts toward sustainable infrastructure.⁸⁵

The United States is also involved in several maritime partnerships. The International Maritime Security Construct involves the United States, the United Kingdom, and six other nations who ensure “freedom of navigation and the free flow of trade for legitimate mariners in the international waters of the Middle East region.”⁸⁶ This is especially important because it shows a collaborative effort to ensure the free flow of goods and vessels through major choke points such as the Bab el-Mandab Strait and the Strait of Hormuz. Additionally, the United States, France, Australia, and the UK are all members of the Combined Maritime Forces, along with 29 other nations.⁸⁷ The force patrols international waters, upholds “International Rules-Based Order (IRBO),” and promotes security.⁸⁸

The United States must assess current partnerships and look for ways to increase readiness. This can include multinational exercises that test the compatibility of systems and communication. The U.S. military should also train for contingencies, especially for force projection and sustainment with contested port access. To counter China’s growing global influence, the United States must assess if current joint and multinational efforts are sufficient. An example of this was in 2021 with the creation of the Australia–UK–U.S., or AUKUS security pact. Through the pact, the United States shared nuclear-powered submarine technology with Australia, which will increase allied capabilities in the Indo-Pacific region.⁸⁹ The United States must continue to increase collaborative efforts to show a united front, such as with Rim of the Pacific (RIMPAC), the U.S. Navy’s multinational exercise conducted every other year. In 2022, 26 nations participated in RIMPAC to display capabilities and promote a free and open Indo-Pacific.⁹⁰ If the United States continues the exercises into the future with enhanced scenarios, the United States can unify a more lethal global force that is both trained on organic capabilities as well as prepared to coordinate and communicate with multiple naval forces.

 

3. Alternative Investment Options

Because the Maritime Silk Road plays to the personal appeals of developing nations who desire economic growth, it is difficult to persuade those nations to look at alternate options. The United States must use information operations to increase global awareness of alternate options required to counter China’s loans. Australia, Japan, and the United States currently have a “trilateral investment initiative” operating in the Indo-Pacific region to support infrastructure needs.⁹¹ This is important because China’s current and future initiatives intend to support the Indo-Pacific region and gain more support to expand their influence. The United States, as a key player in the World Bank, has the power and opportunity to offer alternative options to the MSR that are sustainable for the economy and environment.⁹² The United States should continue working with allies and partners to offer debt relief to BRI countries who risk defaulting on their payments.⁹³ This assistance opportunity would reduce the probability of a nation defaulting, resulting in China assuming majority or full port ownership.

The United States could specifically leverage the International Development Association (IDA), a component of the World Bank focused on providing zero- or low-interest loans and reducing inequalities.⁹⁴ While the United States and China are both members of the IDA, the United States could propose debt relief initiatives for a low-income nation as either a proactive measure against an MSR contract or as a reactive measure if an MSR nation requires refinancing. The United States is also a member of five MDBs, which include “the World Bank, Inter-American Development Bank, Asian Development Bank, the African Development Bank, and the European Bank for Reconstruction and Development.”⁹⁵ The United States applies leadership through these banks by promoting transparency, advocating for grants, and adopting new lending policies that analyze results and performance.⁹⁶ The United States has the opportunity to continue encouraging changes to MDBs to instill strict standards that support developing nations and appeal to those experiencing financial struggle. In doing so, the United States maintains a competitive edge over China who attempts to bypass international norms.

The United States also has the largest economy in the world and there are opportunities to leverage that economic advantage.⁹⁷ The Better Utilization of Investments Leading to Development (BUILD) Act of 2018 creates the U.S. International Development Finance Corporation (IDFC) with the mission to “promote private investment in support of both U.S. global development goals and U.S. economic interests.”⁹⁸ This opportunity expands options for the United States to invest in developing nations beyond the Overseas Private Investment Corporation, the predecessor to the new IDFC.⁹⁹ The BUILD Act differs from China’s financing through mandatory reporting requirements and transparency. The act requires the IDFC to create desired development outcomes, measures of performance, and release of the assessments to the public through a database.¹⁰⁰ This formalized process shows that the United States wants to enhance developing nation capabilities, as well as adhere to international norms of transparency and feasibility assessments. The United States can present this loan option to counter MSR proposals.

 

4. Lethal Force: Research and Development

The 2018 National Defense Strategy described the need for a more lethal force, including technological innovation.¹⁰¹ The United States can create a more lethal force by “increasing funding for federal research and development and boosting investment in basic science, technology, engineering, and mathematics (STEM) education.”¹⁰² Army Futures Command and Army Materiel Command continue to innovate and compare the required capabilities for the current and future scenarios in conflict and competition.

As China enhances their capabilities through multidomain operations (MDO), the United States must counter these enhancements. The U.S. goals are to be MDO-capable by 2028 and MDO-ready by 2035.¹⁰³ China is enhancing their capabilities in areas such as “artificial Intelligence (AI), hypersonics, robotics, and swarming.”¹⁰⁴ According to the 2019 Army Modernization Strategy, the Army assumes that the budget will remain flat in the future, but research and development will mature.¹⁰⁵ To counter threats to the United States, the Army’s focus includes “long range precision fires, next generation combat vehicles, future vertical lift, network, air and missile defense, and soldier lethality.”¹⁰⁶ These initiatives can counter China’s increasing military capabilities and global influence through the Maritime Silk Road. As the Army surges energy and resources to modernize the force, there is risk to the readiness of the current force.¹⁰⁷ To ensure readiness, the military must continue to war-game all applicable contingencies, including contested waters and limited port access.

 

5. Increased Awareness

The information instrument of national power is essential to message joint initiatives and collaborate with partners and allies. The United States can aggregate data on Maritime Silk Road agreements and analyze that information to exploit malpractice and unethical standards, including bribery and other coercive influence tactics. The United States should work with that host nation and neighboring nations to share the information publicly, as a warning to others. Secondly, the United States can work with MDBs, such as the World Bank, to raise awareness and provide procurement guidance to developing nations that do not have enforceable guidelines.¹⁰⁸ In doing so, China will have less control in dictating the financial support and contract bidding process. Additionally, the United States should continue developing fusion centers that focus on sharing intelligence. The Counter-Terrorism Information Facility, hosted by Singapore, is an example of a fusion center that works with the United States to share information.¹⁰⁹ The United States must enhance networking between allies and partners to deter Chinese aggression.

 

6. Ethics

The Interim National Security Strategy Guidance stated, “We will ensure that U.S. companies do not sacrifice American values in doing business in China.”¹¹⁰ Having a strong moral code and using ethics to drive decisions is how the United States maintains mutual trust with partners and allies. As examined earlier, China uses coercive influence techniques to manipulate developing nations. It would be easy for the United States to counter these actions in the same manner. What distinguishes the United States is the ethical decision making. The United States, like any nation, conducts operations that meet their national interests. Not every country, however, uses ethical business practices. By offering alternative financial options and enhancing partnerships to ensure mutual support, the United States maintains the mutual trust required to counter China’s Maritime Silk Road and enable force projection

 

Conclusion

China is using their global power and economic strength to achieve their national objectives. As key terrain in the Indian Ocean becomes contested, the United States must use all instruments of national power to strengthen alliances and partnerships while countering Chinese port influence. At the current state, the Maritime Silk Road impacts the United States by reducing military operational security, altering port availability for force projection, and creating an unethical new norm for internationally financed projects. To counter such impacts, the United States must exercise sealift redundancies, implement alternate investment options, enhance military lethality, and increase global awareness, all while sustaining partnerships and maintaining a strong ethical framework. To achieve these recommendations, the United States must work as a united front in a whole-of-government approach. If the United States fails to act, support from partnered nations will decrease and China will increase their international control over financial procurement standards and infrastructure projects.

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Endnotes

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