China builds

at U.S. base

Tempers are reported to be high in the U.S. construction industry because the U.S. Navy has awarded a contract for construction work in Guam to a mainland China firm. The con tract, for SUS6BO,OOO is for building work at Apra Harbor Naval Station. This is said to be the first time a communist owned organisation has won a Pentagon construction contract.

The Chinese were apparently the low bidders for the work and, under Washington’s cur rent cost-paring rules, were awarded the contract.

Yet the U.S. construction in dustry, already hard-pressed to compete with Japanese and Korean companies for Depart ment of Defence jobs in the Pacific, is not likely to take it lying down and have begun efforts to amend the American Preference Act (Public Law 98- 396) to give greater protection to U.S. constructors.

The Guam contract is not sensitive in a security sense. It is for power pole hardening. But American construction men say they fear it is the thin edge of the wedge of a mainland Chinese drive to compete very strongly for such contracts.

Agency report.