Trump Seeks to Boost US Shipbuilding Amid China’s Dominance
By Andrew Thornebrooke
President looks to encourage growth in the U.S. domestic shipbuilding industry as China’s navy continues to expand.
President Donald Trump is moving to establish a new executive office and regulations to encourage growth in the United States domestic shipbuilding industry as the nation contends with China’s rise.
The United States Office of Shipbuilding will coordinate actions to bolster the nation’s foundering shipbuilding industry as the administration simultaneously issues heavy fees on commercial operators of Chinese-made vessels.
He added that there would be tax incentives to boost domestic shipbuilding.
The chief executive officer of CMA CGM, Rodolphe Saade, who joined Trump in the Oval Office, said the investment would create 10,000 jobs and include the expansion of container ports and the creation of an air cargo hub in Chicago.
Such a move would likely generate enormous cash inflows but could deter business given the world’s current reliance on Chinese manufacturers for commercial seacraft and cargo containers.
A working draft of the executive order states it would also charge a fee for any vessel that enters a U.S. port regardless of where it was built or flagged if that vessel is part of a fleet that includes other vessels built or flagged in communist China.
The Epoch Times has reached out to the White House for further details.
It’s unclear how well received the order will be, given its associated costs and the move to pursue fines en masse could be met with choppy waters.
The World Shipping Council, the primary trade association for international shipping, has said the fees could hit virtually every ship calling at U.S. ports, incurring up to $30 billion in annual costs on American consumers, and potentially doubling the cost of shipping U.S. exports.
US Shipbuilding: Small and Costly
The administration nevertheless considers bolstering domestic and allied shipbuilding a priority given the immense economic and military advantage that has been ceded to China in recent decades as the communist power has rapidly taken over responsibility for the majority of the world’s shipbuilding.
U.S. domestic shipbuilding has all but collapsed in the past 50 years as commercial enterprises have sought out faster and cheaper builders to satiate the immense demands of global trade.
At present, the United States only builds between 0.1 and 0.2 percent of the world’s ocean-going commercial ships as measured by gross tonnage.
The collapse in the nation’s overall shipbuilding capacity has also wreaked havoc on its military supply chain by creating severe supply chain bottlenecks.
The U.S. Navy devised a plan in 2016 to increase its battle force to 355 ships by 2030 and in 2023 planned to raise that number further to 381 ships.
Instead, the force has languished between 270 and 300 vessels, a range it has maintained since 2003.