China State Construction nets $100m US subway deal

I had to rub my eyes this morning to make sure that I was reading this story correctly. It would seem to me that this project would be a perfect project for a US company as part of Obama's ill fated Stimulus Program. NOPE! Chinese contractor gets the gig. Oh yeah and its their THIRD US contract this year. That makes for $2billion in contracts for this year alone.

Well, is this how Obama plans to ultimately pay back the Chinese. I just hope they don't build infrastructure projects like they build toys.

China State Construction Engineering Corp, the largest contractor in China, has bagged a subway ventilation project worth about $100 million in New York's Manhattan area, marking the construction giant's third order in the United States' infrastructure space this year.

The contract was given to China Construction American Co, a subsidiary, the Wall Street Journal quoted a source as saying.

"The new project, along with the $410-million Hamilton Bridge project and a $1.7-billion entertainment project it won earlier this year, signals China State Construction's ambition to tap the American construction market," said Li Zhirui, an industry analyst at First Capital Securities.

Li, however, said the order came as no surprise as the US government is spending massively on infrastructure projects.

The three orders only account for about 4 percent of the value of its total orders this year, Li added.

In the first three quarters of this year, the Chinese construction giant signed more than $2 billion worth of contracts in the US market. China State Construction was also the contractor for a high school, a railway station and the Chinese embassy in the US.

I find this part interesting because it applies to China's spending within their own Stimulus plan. I thought that we were supposed to be doing the same thing with US based companies. Shovel ready projects my foot!!

Orders from the infrastructure construction business were boosted by 90 percent largely due to the fiscal stimulus allocated to China's infrastructure sector.

www.chinadaily.com.cn...

So americans arnt good enough or trustworthy to do it? or..is it because they come at a higher price, than the chinese?

It's sickening. I cannot believe the utter disregard these politicians have for their very own people. I mean for goodness sakes awarding giant construction jobs in the US to giant Chinese construction firms!?!? No wonder the US is falling apart in all sorts of ways! Disgusting. If there was just somebody who wasn't a complete snake to lead the people back to the top.... alas all the heroes are long gone from the leadership of this country and all that stands now is the biggest criminal syndicate ever amassed versus mankind..... sigh...

Let's hope the 5 year warranty holds up on these infrastructure projects that are most likely being built using Chinese materials ie. steel, pvc, and the ever so popular Chinese Drywall.

On a side note, I just bought some suet to feed the birds from my local Lowes store and the stuff was made in China. Chinese suet?? WTF. I hope my birds don't die.

Slightly xenophopbic, yet predicatable responses in this thread.

This company, a US based subsidiary, will employ Americans to do the work in America. How is it, to quote Redwookieaz, showing disregard for the American people? Also, how do you know they'll be using Chinese materials? It would probably be cheaper to use local suppliers anyway. If there are no local suppliers, then what have you got to moan about?

At the end of the day, this is just a contract awarded to "MegaCorp A", as opposed to "Megacorp B". They still employ the same grunts to do the work and cream off excess amounts to line the pockets of people who don't do anything.

This made me laugh:

Well, is this how Obama plans to ultimately pay back the Chinese. I just hope they don't build infrastructure projects like they build toys.

They are probably paying the Chinese company with money borrowed off China in the first place.

reply to post by stumason


Sure, they may employ American workers but, the the profits will still end up in China. Furthermore, there is no guarantee that they won't use Chinese raw materials for these projects. China does everything cheaper. Just ask the commercial American Home Builders who were installing defective and cheap Chinese drywall and cellulose insulation in their homes. It is all about economies of scale which the Chinese have mastered due to large scale manufacturing and dirt cheap labor.

reply to post by jibeho


Correct me if I am wrong, but won't a US based subsidiary pay taxes in the US?

Granted, any profits after tax will end up with the shareholders, which in this case are Chinese, but how is that different from any other company.

I think you'd be shocked to find out just how many "American" companies, even some of your big Defence contractors, are at least part foreign owned. It's a global world, get used to it.

reply to post by stumason


You are correct however, the irony in this article struck me funny because of this company's incredible boost that resulted from the Chinese domestic stimulus package.

Orders from the infrastructure construction business were boosted by 90 percent largely due to the fiscal stimulus allocated to China's infrastructure sector.

I am sure you are aware of Obama's stimulus that has done nothing to boost our economy. The bulk of those dollars have yet to be spent and those that have been spent are difficult to even track.

Now we have a Chinese company that has already earned nearly $2 billion in US contracts in the first 3 quarters of 2009 alone. I know a lot of local contractors that could certainly use a boost like that. That is BS. bottom line

Originally posted by jibeho
You are correct however, the irony in this article struck me funny because of this company's incredible boost that resulted from the Chinese domestic stimulus package.

Orders from the infrastructure construction business were boosted by 90 percent largely due to the fiscal stimulus allocated to China's infrastructure sector.

I find it ironic that an American is pointing out the irony of the situation to a Brit, the inventors of irony

Originally posted by jibeho
I am sure you are aware of Obama's stimulus that has done nothing to boost our economy. The bulk of those dollars have yet to be spent and those that have been spent are difficult to even track.

I don't doubt, we have the same "stimulus" crap going on here.

Originally posted by jibeho
Now we have a Chinese company that has already earned nearly $2 billion in US contracts in the first 3 quarters of 2009 alone. I know a lot of local contractors that could certainly use a boost like that. That is BS. bottom line

I think what you will find, as in most Government contracts, is that one big company wins the contract, then sub-contracts to many smaller firms, most of which are usually local. For example, our new carriers are being built by an alliance of several big companies, inclduing a French one called Thales. But alot of the work, such as cutting the steel, is done by smaller firms on a sub-contract basis.

Don't jump to conclusions, at least wait to see who gets the work out of this deal. I highly doubt that the big nasty Chinese Corp has an army of chinese workers, or a plethora of Chinese suppliers and sub-contractors just waiting to swoop in to the US.

I bet most of the money in the deal does actually end up paying American firms and American workers.


[edit on 25/11/09 by stumason]

I believe this is a double edged sword. On the one hand, the government should go with the lowest bidder (assuming the Chinese contract was the lowest). However, on the other other hand, should we not be STIMULATING the U.S. economy...

No matter what way you slice it, the Obama critics will...criticize.

I just hope the Chinese don't built this thing with "self destruct" devices implanted into the construction.

Just my 2-cents

reply to post by stumason


I certainly appreciate your optimism. Unfortunately, I have found that my optimism regarding our current administration has been totally absent in the past 8 months. When I read info. like this it is tough to turn the other cheek.

Since the stimulus bill was enacted in February, the United States has lost 2.8 million jobs, according to the Bureau of Labor Statistics (BLS). Those job losses increased in 29 states last month, according to the BLS.

“Over 4 million Americans have thus lost their jobs since the beginning of January, the month President Obama was inaugurated, when unemployment stood at 7.6 percent,” the letter said. “It is time to recognize that the stimulus is stimulating very little except government.”

Unemployment now stands at 10.2 percent