China Global Expansion Continues
Sao Tome and Principe, an African island country located near the equator, and China have signed a deal to build an $800 million deep sea port.
China's state-owned China Harbour Engineering Co. said it will spend about $120 million in the project and will be responsible for engineering, design and construction of the port. The new deep sea transshipment port will be developed in phases and will be operational in 2019.
Cocoa production and exports are Sao Tome’s and accounts for about 80 percent of the island nation’s exports. But it also has the potential for hydrocarbon development. Sao Tome is located in the oil-rich Gulf of Guinea, which is jointly being developed in a 60-40 split with Nigeria. And while actual production is still years off, the first licenses were sold in 2014.
Constructing a deep sea port in Sao Tome is the second indication of increased Chinese interest in Africa. Last week, reports surfaced that China is eyeing investments in Kenya’s Port of Mombasa and Lamu to expand its Maritime Silk Road vision.
The Port of Mombasa is the busiest in East Africa and serves Kenya, Uganda, Rwanda, South Sudan and the Democratic Republic of Congo.
Construction is currently taking place on Port of Lamu, which is part of the transportation corridor between Kenya, Ethiopia, South Sudan and Uganda. When completed, the corridor, which will be named LAPSET, is expected to facilitate the transport of crude, gas as well as other goods. The project will include a network of railways, highways, pipelines and power grids for increased international trade.