Tuesday, April 1, 2025

The U.S. Chamber this week filed comments and joined a coalition letter urging the administration to look at options other than port fees to address China’s dominance in shipbuilding. The letter, which was signed by 317 trade associations, states the following:

“We share the goal of finding real remedies to address China’s dominance in the maritime industry, while also revitalizing the U.S. shipbuilding industry. We strongly urge USTR to reconsider the proposed remedies which will significantly impact the millions of stakeholders who rely on efficient maritime services to move goods in and out of the United States.”

Fees and Bans: The administration has continued a Biden-era investigation by the Office of the U.S. Trade Representative (USTR) that now proposes to charge U.S. businesses and farmers a fee of up to $3.5 million for using a Chinese-made ocean vessel—or an ocean carrier that uses Chinese-made vessels—for importing or exporting their products. The investigation goes one step further by proposing export restrictions on U.S. businesses and farmers unless they can secure a U.S.-flagged vessel.

Serious Concern, Wrong Approach: The March 24 letter adds that the group “support scrutiny of China’s efforts to dominate the maritime industry. However, USTR’s proposed actions will not deter China’s broader maritime ambitions and will instead directly hurt American businesses and consumers.”

“Specifically, USTR’s proposed fees will increase shipping costs, container and non-containerized, by at least 25% ($600-$800 or more), adding approximately $30 billion in annual costs on U.S. businesses and farmers. This will lead to higher prices for U.S. consumers and undermine the competitiveness of many U.S. exports— leading to a decline in export revenues and increasing the U.S. trade deficit, contrary to the Trump Administration’s America First trade goals.”

Retroactive Punishment: In addition to the comments and letter, the U.S. Chamber’s Vice President for Transportation, Infrastructure and Supply Chain Policy John Drake penned a March 24 blog on the issue:

“Implementing these proposals would put American businesses, farmers, and consumers in an incredibly difficult position. The World Shipping Council estimates that these fees would increase shipping costs by 25% for most goods, adding $30 billion in new costs for American consumers annually…. There’s broad concern in U.S. industry and agriculture that USTR’s proposal fails to offer real and effective remedies. Instead, it retroactively punishes ocean carriers and U.S. businesses for utilizing today’s existing fleet without doing anything to materially address the issue at the heart of this investigation: stimulating the building of new ships within the U.S.”