China’s trillion-dollar Belt and Road Initiative is hailed as the “project of the century” as the world’s second-largest economy looks to take the lead role in globalisation historically held by the West.
Much has been discussed about the political, economic and cultural impact that the initiative could have globally since it was introduced in 2013. However, there has been little attention paid to the infrastructure projects in the making.
FinanceAsia will publish a series about the 10 biggest Belt and Road infrastructure deals that have been signed in the 2018 calendar year, and examines which companies are spearheading and likely benefitting from these projects.
The series follows a similar feature in 2017 where we examined BRI projects that started that year. Click here to revisit the feature.
These projects will be published in descending order based on their estimated project value. We will only include infrastructure deals of more than $1 billion.
7. Fourth Panama Canal Bridge, Panama
Companies involved: China Communications Construction Company (CCCC)
Status: Construction started in December 2018
Estimated project value: $1.42 billion
In June 2017, Panama established formal diplomatic ties with China and ended its connection with Taiwan. Less than two years later, the Central American country has awarded China one of its largest infrastructure projects.
State-owned China Communications Construction Company (CCCC) and its subsidiary China Harbour Engineering Company started construction of the fourth bridge across the Panama Canal in December, four months after it won the tender from the Panamaian government.
Panama’s decision to award the project to the Chinese consortium has drawn criticism from an Italian-Korean consortium which was disqualified at the final stage of the process. The consortium, formed by Italy’s Astaldi and South Korea’s Daelim, accused the government of lack of transparency in the bidding process.
The Italian-Korean consortium lost the tender despite presenting a competitive $1.2 billion offer, which was about 14% lower than the winning bid of $1.42 billion by the CCCC-led consortium.
The fourth Panama bridge is China’s largest-ever cash-settled project in Central America. Beijing said the project requires high-level construction techniques because its super-large dimensions and multiple functions.
According to CCCC, the bridge will be built with a main span of 510 meters, a 75-meter gauge and a bridge deck width of 51 meters. Construction is also challenging because the bridge features a six-lane highway as well as a railway line for Panama City’s proposed subway line 3.
The Panamanian government said the new bridge will benefit 1.7 million people – nearly half of the country’s population. CCCC has agreed to completed construction within 60 months.
China’s participation in the project is an alarming sign for the US, as it is a sign that the country is losing its economic and political influence over its rival.
Trailing the US, China is now Panama’s second-largest trading partner and the second-biggest user of the Panama Canal, which supports about 6% of global trade.
