New rules part of effort to revive US shipbuilding, but penalties scaled back after warnings about impact on consumers
The Trump administration is forging ahead with plans to charge steep fees on Chinese-built ships for stopping at US ports in an effort to revive its shipbuilding industry, but scaled back the penalties after warnings about the impact on consumers.
The Office of the US Trade Representative (USTR) significantly watered down original plans from February, under which vessels built in China would be charged $3.5m (£2.6m) each time they docked at a US port. The US and China are locked in a trade war.
Those proposals prompted a backlash from US domestic industries, which warned the port charges would increase prices for American consumers, and sent a wave of concern through the global shipping industry.
The USTR said it would start charging port fees in 180 days, and they would rise incrementally over the coming years.
Under the new rules, Chinese-linked ships will be charged fees linked to the weight of their cargo or the number of containers on board, rather than according to how many US ports they call at.
The fees will be assessed up to five times a year, and can be waived if the owner places an order for a ship built in the US.
“Ships and shipping are vital to American economic security and the free flow of commerce,” said the US trade representative Jamieson Greer, announcing the new fees, most of which will begin in mid-October.
“The Trump administration’s actions will begin to reverse Chinese dominance, address threats to the US supply chain, and send a demand signal for US-built ships,” Greer added.
The proposed fees came as part of the USTR’s investigation into China “targeting the maritime, logistics, and shipbuilding sectors for dominance”, which was launched in April 2024 under the Biden administration.
Chinese-built ships make up most of the fleets of the world’s 10 largest shipping carriers, while other east Asian countries including South Korea and Japan also dominate global shipbuilding.
The US shipbuilding industry, which was dominant after the second world war, has declined over the years and now accounts for less than 1% of global output.
Under the USTR’s plans, there will be separate fees charged on Chinese-operated and Chinese-built ships, which will gradually increase in subsequent years.
The fees for Chinese-built ships will begin at $18 per net ton (NT) or $120 per container, which could mean that a ship loaded with 15,000 containers would be charged $1.8m.
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All car carrier vessels not built in the US will also be hit with fees beginning in 180 days’ time.
The US will also introduce new fees for liquefied natural gas (LNG) carriers, although these will not take effect for three years.
The USTR has also proposed introducing tariffs on some ship-to-shore cranes and on Chinese cargo handling equipment.
However, it will not charge fees on bulk commodity exports on ships that arrive in the US empty, nor on voyages in the Great Lakes, Caribbean and between US territories. Shipping operators on these routes had expressed concern what the original port fee proposals would have meant for trade.
The USTR’s original plans prompted significant criticism during hearings in Washington DC in late March, as shipping companies and trade groups said the fees would hurt US farm exports, increase consumer prices and put at risk the jobs of US dock-workers.
Earlier this month, Trump signed an executive order aimed at revitalising the US shipbuilding industry, for both commercial and defence purposes, through increasing investment in the sector.
Shipping companies and industry analysts forecast it would take years for the US to increase its shipbuilding capacity.
Source: www.theguardian.com