The world’s top shipbuilding nation has used unfair practices to chisel out its dominant position in the sector, a months-long American investigation has concluded, leading to the potential for tariffs of some sort on China-built tonnage.
Reuters is reporting that with one week left of the Joe Biden presidency, the US Trade Representative, Katherine Tai, has concluded that China has been using unreasonable tactics to assume global shipbuilding supremacy whereby today it controls two-thirds of the world’s orderbook. Tai was requested by Biden to pursue the investigation in April last year following calls from a number of American unions.
The report – due to be published soon – cites artificially supressed labour costs, forced technology transfer and intellectual property theft among a raft of accusations levelled at Beijing.
The unions who demanded the probe have called for tariffs or higher port fees on Chinese-built vessels.
“Through government support and public investments to its national shipbuilding ecosystem, China emerged as a market leader, commanding currently nearly 65% of global shipbuilding orders, an impressive rise considering the less than 10% share in 2000,” noted a recent report from Greek broker Intermodal.
Meanwhile, the combined orderbook share of Japan and South Korea has declined from 78% to 31% over the same period.
President-elect Donald Trump has already made overtures to Korean and Japanese yards to join forces to ensure there are non-Chinese shipyard alternatives in the years ahead.
China, for its part, has repeatedly played down the shipbuilding allegations levelled at it by the US, Canada and others.
A Chinese Commerce Ministry spokesperson dismissed the shipbuilding probe when it was announced last April, telling reporters in Beijing: “It lacks factual basis and goes against economic common sense to blame China for America’s own industrial problems.”
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