According to U.S. media reports, Trump is preparing to sign an executive order aimed at weakening China’s dominant position in the global maritime industry and revitalizing the U.S. shipbuilding sector.
According to a draft summary obtained by The Wall Street Journal, the executive order includes 18 specific measures aimed at revitalizing the U.S. shipbuilding industry. Key provisions include: imposing fees on Chinese-made ships and cranes entering U.S. ports to fund incentives for domestic shipbuilding; establishing a dedicated shipbuilding office within the White House to “counter China’s shipbuilding industry” and promote the development of the U.S. maritime sector; increasing wages for workers at nuclear submarine shipyards; and directing the Office of Management and Budget to review and improve procurement processes, particularly within the Navy.
The Trump administration is banking on these measures to reduce dependence on foreign-built ships and stimulate domestic ship construction in the U.S..
The document is still labeled as a draft, and the specifics may be adjusted as the review process proceeds. In a speech to Congress on the evening of March 4, Trump said his administration would work to “revitalize America’s commercial and military shipbuilding industries” and announced that a new shipbuilding office would be established in the White House. Trump said the U.S. has fallen too far behind in shipbuilding and vowed to move quickly to turn it around.
The mooted measures reportedly draw on several bipartisan proposals that have been on the table for several years. These include legislation pending in Congress aimed at revitalizing the U.S. shipbuilding industry, as well as a proposal from the Office of the U.S. Trade Representative to impose additional port fees on Chinese-built ships. Many of the previous proposals have undergone months of scrutiny or faced an uncertain political process, but Trump has said the new measures can be implemented without congressional approval if they are signed as presidential executive orders.
Trump’s policy moves toward China’s shipbuilding industry have drawn widespread criticism and opposition. Last month, when the Office of the U.S. Trade Representative first proposed charging fees on Chinese ships, it was met with strong opposition from shipping companies based in Europe and Asia outside of China.
As the world’s largest producer of container ships, China holds a pivotal position in the global shipbuilding industry. According to Linerlytica statistics, nearly 29% of currently operational ships worldwide, measured by container capacity, were built by Chinese shipyards, and this proportion rises to as high as 70% for new orders.
In the face of the Trump administration’s possible introduction of the fee policy, the world’s largest container shipping company – Geneva-based Mediterranean Shipping CEO Soren Toft (Soren Toft) expressed deep concern. He indicated that if the Trump administration implements the fees, shipping companies will be forced to withdraw their services from some of the smaller U.S. ports as the cost of unloading a small number of containers becomes unacceptable.
Toft further pointed out that this fee policy, if implemented, may lead to some of the Asia to the United States route of 40-foot container transportation cost surge of up to US$ 800. And these additional costs will inevitably end up being passed on to importers and consumers, thus having a profound impact on global trade and economic growth.