Crypto News: Supply Lines: South Asia trade gateway

A little-known US government agency is providing $553 million in financing to help develop a port terminal in Sri Lanka's capital as Washington looks for counterweights to China's trade dominance in South Asia.

The deep-water West Container Terminal in Colombo is the International Development Finance Corp.'s largest infrastructure investment in Asia, and among its biggest globally. It will bolster Sri Lanka's economic growth and regional trade integration, including with India, "a key partner to both countries," the agency said in a statement.

DFC said it will be working with sponsors John Keells Holdings and Adani Ports, owned by an Indian billionaire. The funding is part of a global acceleration of DFC investments that totaled $9.3 billion in 2023, as Bloomberg reports here.

"It is a high priority for the US to be active in the Indo-Pacific region," Scott Nathan, the DFC's chief executive officer told reporters in Colombo Wednesday. "It is obviously the engine of economic growth for the world."

China Merchants Port Holdings runs a separate terminal in Colombo's port and is developing an industrial park in Sri Lanka.

Source: Sri Lanka Ports Authority

Colombo's port is one of the busiest in the Indian Ocean, given its proximity to international shipping routes where nearly half of all container ships pass through. The DFC said it's been operating at more than 90% utilization for two years and needs new capacity.

DFC, a development finance agency launched under the Trump administration, was established to aid poorer nations while advancing US foreign policy goals. It struggled at first to stake out projects during the Covid-19 pandemic.

China's state-0wned shipping companies have long sought control of logistics capacity to keep its goods flowing around the world. China's $3.6 trillion in exports last year amounted to 14.4% of the world total, with the US's 8.3% share coming in second, according to World Trade Organization data.

Earlier this year, Germany approved a minority stake by China's Cosco in a Hamburg terminal — raising broader questions in the European Union about Beijing's strategic interest in maritime gateways.

The DFC's announcement was made as government and corporate leaders are gathering for day one of the Bloomberg New Economy Forum in Singapore. War, geopolitical tension and inflation were among the litany of risks identified at the conference.

Click here for the NEF agenda through Nov. 10, and read more highlights from today's events:

—Brendan Murray in London

The Big Take | Today's Bloomberg Big Take chronicles the economic flashpoints emerging in the transition from the century-long era of the internal combustion engine to the electric-vehicle age. In Canada's resource-rich "Ring of Fire," green goals are colliding as permits to dig up EV minerals are slowed by concerns over environmental degradation. In Thailand—dubbed Asia's Detroit—Japanese automakers are losing ground to Chinese companies. In Mexico, Western automakers are expanding fast to sell EVs across the northern border, but in the meantime Chinese firms are ramping up sales to local consumers.

Chinese President Xi Jinping is set to be the guest of honor at a dinner with top US business executives when he visits San Francisco for the Asia-Pacific Economic Cooperation summit next week. Meanwhile, China is struggling to lure foreigner investors back.
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Bank of England Governor Andrew Bailey warned fragmentation of the global economy poses a risk to financial stability and called on regulators around the world to pursue common policy objectives.
India is proposing reducing import taxes on some electric vehicles from the UK in an effort to clinch a free-trade deal between the two nations by the end of the year, according to two people familiar with the discussions.
The US trade deficit widened by more than expected in September, reflecting the resilience of American demand for foreign goods. So far this year, the US is running its smallest merchandise-trade deficit with China since 2010.
Nissan plans to invest $575 million in its Brazilian factory, with the goal of doubling its market share in Latin America's biggest economy by 2026.
Once dissuaded by tariffs starting in the 16th century under Spanish rule, Peru's winemakers are trying to make a comeback on the global stage against more established export rivals Chile and Argentina.
Coming Up

Join Bloomberg's "Supply Chain Resiliency: Risk & Mitigation" event in Detroit on Nov. 16 for an afternoon with our research analysts & subject experts to discuss trends, risks, and innovative ways to monitor and manage critical supply-chain elements — especially their impact on the auto industry. To register for the free, in-person-only event, click here.

Maersk's recent guidance that triggered a stock plunge may have been too cautious, JPMorgan says as the bank sees an opportunity to buy, upgrading the shares to overweight from neutral.
C.H. Robinson's margin improvement over the long term will be predicated on its ability to deploy technology-driven tools to spur employee productivity, Bloomberg Intelligence says.
Run SPLC after an equity ticker on Bloomberg to show critical data about a company's suppliers, customers and peers.
Use the AHOY function to track global commodities trade flows.
For freight dashboards, see {BI RAIL}, {BI TRCK} and {BI SHIP} and {BI 3PLS}
Click HERE for automated stories about supply chains.
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