US to impose hefty fees on Chinese ships amid industry push
The United States is increasing efforts to counter China's dominance in the shipbuilding industry. Authorities plan to impose up to $1.5 million fees for Chinese ships docking at U.S. ports. According to CNBC, Congress is also considering the SHIPS for America Act to rejuvenate the national shipbuilding sector and reduce reliance on Beijing.
The Trump administration intends to limit Chinese ships' presence in American ports significantly. Under the new policy, carriers using Chinese vessels may be subject to fees of up to $1.5 million per ship. This is part of a broader strategy aimed at reducing China's dominance in the shipbuilding industry and reviving American ship production, reports CNBC.
In 2024, China accounted for 81% of the global container ship market, with its share in the bulk carrier sector at 75%. Beijing's share in LPG transport increased to 48%, and in the LNG segment, it was 38%.
New regulations and potential impacts on the industry
The United States will introduce special fees on ships built in China that dock at American ports:
- Chinese operators, such as COSCO, will pay up to $1 million per ship.
- Carriers with Chinese vessels in their fleet may be charged up to $1.5 million per ship.
According to the USTR report, additional restrictions might apply to companies with more than 50% of their ship orders placed in China. This would mean imposing additional fees on them, as stated in the report.
Soren Toft, CEO of MSC – the world's largest ocean carrier – warns that new regulations could increase global freight costs by $20 billion (approximately CAD 27 billion) and raise container fees by $600-800 (approximately CAD 800-1,070). Carriers may reduce calls to the United States, shifting transshipments to other ports.
Plan to rebuild the American shipbuilding industry
In response to China's dominance in shipbuilding, a bipartisan initiative, the SHIPS for America Act, has emerged in Congress. The project includes:
- Tax incentives and subsidies for American shipyards.
- Increasing the number of U.S.-flagged ships – the goal is 250 vessels.
- Requirement for a portion of U.S. exports to be carried on American ships – starting from 1% annually and gradually increasing to 15%.
Currently, the United States has fewer than 100 ocean-going ships, while China operates a fleet of 5,500 vessels. Senator Mark Kelly, one of the bill's authors, emphasizes that the goal is not to surpass China but to reduce the gap and strengthen national security.
Problems in the American shipbuilding sector
The United States faces significant challenges in rebuilding its maritime fleet. Shipbuilding in the United States is substantially more expensive, costing four times more than in China. Philly Shipyard produces container ships that are five times more costly than their Chinese counterparts.
Additionally, the cost of maintaining U.S.-flagged ships is twice as much as those from China or South Korea. Despite these difficulties, the U.S. Congress is planning actions to restore the competitiveness of the American shipbuilding industry and reduce dependency on China.
