Trump Proposes New Ship Fees to Challenge China’s Maritime Might

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(Bloomberg) – The Trump administration proposes fees for the use of Chinese commercial ships that it can help in the face of marine domination in the country.

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The American Trade Representative Office has set a plan for fees on Chinese ships that transport traded goods in addition to the mandate that requires the transfer of part of American products to American ships.

The proposal, which was announced on Friday, stems from a commercial investigation in China's practices in the marine construction industries, logistical services and ships building that started under the Biden administration and concluded with a report just four days before President Donald Trump took office. The American investigation concluded that Beijing was unfairly dominating the sectors and said that “urgent work” was necessary to address this issue.

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However, if adopted, the proposed fees can be translated into additional costs for American consumers, where the high shipping costs can be passed in higher prices. It is also not clear that the proposals will be sufficient to restore the ability to build American ships, which have eroded despite the protection of a century to encourage the use of vessels operating in the United States.

While the United States abandons its fixed supplies from warships and Europe leading the world in building cruises ships, three Asian countries dominate the construction of global ships: China, South Korea and Japan, which together represents more than 90 % of the construction of commercial ships.

In his proposal on Friday, the US Trade Actor Office said that China targeted the sectors of building ships and logistics of domination, and underwent the competition effectively and winning “the market share with a great impact.”

The Chinese market share has grown from less than 5 % of the global load in 1999 to more than 50 % in 2023. China has 19 % of the world of commercial world from January last year, and it controls the production of 95 % of shipping containers, the office said .

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Shipping costs on Chinese ships can provide an opportunity to build ships in South Korea and Japan.

Catherine Tae, who held the position of Joe Biden Trade, said last month that the United States is ranked 19th in the world in the construction of commercial ships, where a volume of less than five ships is built every year. She added that, compared to more than 1700 a year.

The Biden Administration said that China's dominance in the industry can be partially traced to price standards and low employment, as well as artificially low -employment costs that undermine competition.

The Commercial Office said that excessive dependence on Chinese supplies creates economic security risks associated with potential turmoil.

The proposed remedy on Friday, which will be imposed under Article 301 of the 1974 Trade Law, is now subject to public suspension and review, including during a general hearing scheduled for next month.

The American Trade Representative proposes many service fees-including a tax of up to one million dollars-to be imposed on it when the Chinese ships that were created into an American outlet enter.

Earlier: The United States tends to be the ingenuity of shipbuilding from allies to compete with China

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The administration also proposes escalating restrictions on maritime transport of all American goods. Initially, at least 1 % of American products that are exported by marine ships on ships that are implemented in the United States must be implemented. The requirements will increase steadily, with the threshold to rise to 15 % after seven years and ultimately include the requirements of ships in the United States as well.

The mandate will effectively expand the long -term requirements that aim to encourage the construction and use of American ships. Under a federal law known as Jones Law, ships that were designed in the United States, which are designed and backed when transporting goods between American ports.

The Commercial Office seeks to fulfill a legal deadline to announce the treatments in the investigation even with the Trump candidate for USTR, Jamieson Greer, who has not yet been confirmed.

Trump began his second term in the opening of new fronts in commercial wars, starting with Canada and Mexico, although eventually in the tasks of North America partners with the announcement of a 10 % tariff on all Chinese goods due to Beijing's failure to stop the fentanel trade.

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Trump also threatened definitions on a group of sectors, including cars, semiconductors, medicines and wood by early April.

The commercial charging sector is seen as a large crane point that China can use due to the global trading system dependent on its ships. Any disturbances in this system, or not, can lead to the supply chain shocks that the United States wants to avoid.

This step is supported by the unions and was the axis of legislators. National Security Adviser Mike Waltz, who was then a member of the Congress, participated in the legislation of care last year to address the advantage of China.

Retail traders are likely to oppose the procedure, on the pretext that the additional costs should be transferred to the consumer.

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