Heavy port spending plans have led some critics to warn of a glut, as ports from Shenzhen in the south to Qingdao in the north add capacity—a contention dismissed by mainland officials. Container throughput at Chinese ports has been growing by 30% a year, and reached 61.8 million teus in 2004. Beijing has said it expects that China could move over 75 million teus this year and 120-140 million by 2010. That potentially explosive growth in China’s container trade has attracted leading global port operators. Hong Kong’s Hutchison Whampoa Ltd., Singapore’s PSA International, A.P. Moeller-Mearsk’s APM Terminals and others are vying to invest in Shanghai’s 100 billion yuan Yangshan port, which will eventually have about 52 berths. “The current development is based on market demand and integrating with central government (policy),” Communications Minister Zhang Chunxian told Reuters. Shanghai and Shenzhen, the two largest container ports in mainland China, were the third and fourth busiest container ports in the world in 2004. If current growth rates continue, both could overtake Hong Kong and Singapore to become the world’s busiest, possibly by the end of the decade. Largely as a result of China’s rapid growth, global shipping capacity has become strained, with shipyards scrambling to fill order backlogs stretching out three or four years. “In spite of the fact that steel prices have doubled and fuel prices are surging, order books for new tonnage are full,” Maersk’s Thomsen said. And the traffic jams could worsen. Container vessels with capacity of 10,000 twenty-foot equivalent units the largest on the seas—are being built. China’s COSCO Container Lines has ordered eight of them. But even at the most efficient ports, these vessels generally take four to five days to unload and load. “China, we believe, will be able to handle that deluge of more and larger ships,” Thomsen said. “What about Europe? What about North America?” A sustained capacity crunch at U. and European ports has the potential to slow global trade. “There does not appear to be any plan in sight to rectify the situation,” Thomsen added. China plans This year alone, China plans to invest about $12 billion to expand and upgrade its creaky railway system. The country is plagued by power shortages, in part because of a lack of rail capacity to transport coal from mines to power plants. The investment is part of an expansion plan approved last year to extend China’s railroad network by more than one-third, to 100,000 km (62,140 miles), at a cost of some $242 billion. Foreign companies, including France’s Alstom, Germany’s Siemens, Canada’s Bombardier Inc. and Japan’s Kawasaki Heavy Industries, are competing to sell rail facilities and technologies to China. The Chinese government plans to invest about 40 billion yuan ($4.8 billion) this year on ports-related infrastructure, with 120 new berths set to open during the year. Heavy port spending plans have led some critics to warn of a glut, as ports from Shenzhen in the south to Qingdao in the north add capacity—a contention dismissed by mainland officials. Container throughput at Chinese ports has been growing by 30 percent a year, and reached 61.8 million teus in 2004. Beijing has said it expects that China could move over 75 million tues this year and 120-140 million by 2010. That potentially explosive growth in China’s container trade has attracted leading global port operators. Hong Kong’s Hutchison Whampoa Ltd., Singapore’s PSA International, A.P. Moeller-Mearsk’s APM Terminals and others are vying to invest in Shanghai’s 100 billion yuan Yangshan port, which will eventually have about 52 berths. “The current development is based on market demand and integrating with central government (policy),” Communications Minister Zhang Chunxian said. Shanghai and Shenzhen, the two largest container ports in mainland China, were the third and fourth busiest container ports in the world in 2004. If current growth rates contin