A ship under construction in Yangzhou, Jiangsu Province, China. (Meng Delong/VCG/Getty Images)
A plan by the Trump administration to introduce fees on the use of Chinese commercial ships is likely to damage the U.S. economy and may fail to reverse China’s shipbuilding dominance, a top shipping trade group said.
The Office of the U.S. Trade Representative has outlined a plan for fees on Chinese-built ships that enter American ports. There’s also a mandate requiring a portion of U.S. products to be moved on American vessels. A hearing on March 24 will take feedback on the proposals, which would trigger significant disruption in the shipping industry if unamended.
The Denmark-based trade group Bimco, which represents almost 2,100 vessel owners in 130 countries, including both the U.S. and China, said that port fees are generally passed on in the supply chain, meaning that U.S. consumers would ultimately face higher prices. The plans could also risk jobs at shipyards and, if implemented as proposed, could threaten U.S. energy exports.
“The proposed actions will impose much increased transport costs on U.S. imports and exports and have negative effects on the wider U.S. economy,” Bimco’s deputy secretary general and director of regulatory affairs Lars Robert Pedersen wrote in a letter submitting feedback to the plans. “Their impact on Chinese dominance is much less certain.”
Bimco is the world’s largest direct-membership trade group. It said that most vessel owners would seek to avoid paying the fees by reducing the number of times they sail to the U.S.
As well as boosting shipping costs due to lower competition, that could also lead to port congestion and risk jobs at ports as some become unattractive for foreign trade.
Pedersen’s response to the proposals were published on Bimco’s website and on a USTR comments portal.
