[Text/Observer Network Xiong Chaoyi] The attempt by the Trump administration to levy high port fees on ships owned, operated, and built in China, and impose new tariffs on cranes made in China, aiming to bring shipbuilding back to the United States, has met with strong opposition from industry insiders.

According to Nikkei Asia's report on May 20, at a public hearing held by the Office of the U.S. Trade Representative (USTR) on May 19, the discussion focused solely on two issues: one was the proposed 100% tariff on STS cranes; the other was the proposed 20% to 100% tariff on cargo handling equipment such as containers, chassis, and chassis components.

The U.S. government team composed of representatives from the USTR, Small Business Administration, Department of Transportation, Commerce Department, Agriculture Department, State Department, Treasury Department, Department of Homeland Security, and Labor Department directly rejected the objections raised by industry representatives regarding these two policies—the phased implementation of port fee regulations for Chinese vessels announced on April 17, as well as the proposal to charge fees for all foreign-built roll-on/roll-off ships.

"Please focus your testimony on the proposed measures," Megan Grimball from the USTR insisted, steering the discussion back to the issue of crane tariffs as the leader of this government team.

Cary Davis, chairman and CEO of the American Association of Port Authorities (AAPA), which represents 81 public ports in the U.S., stated that while the association supports the goal of localizing crane production, Congress should first implement tax incentives to stimulate domestic capacity. He said during the hearing: "There are no STS crane producers in the U.S. This has not been the case since the 1980s."

Davis further explained in a written document that outside of China, only three companies worldwide provide internationally purchasable STS cranes—Mitsui E&S of Japan and Konecranes and Liebherr of Europe—but none of these companies have sufficient capacity to meet market demand.

Crane equipment at the Port of Los Angeles, The Nikkei Asia

Charlie Jenkins, CEO of the Port of Houston, explained during the hearing that the port had signed contracts for eight STS cranes with China, with an expected delivery date in the spring of 2026.

"These cranes were ordered in July 2024," Jenkins emphasized, noting that this timeline predates the announcement of the new tariff policy by several months.

Jenkins pointed out that the proposed 100% tariff would be layered on top of the 25% tariff already in effect in 2024. If the high tariffs imposed by Trump on China resume after the 90-day "deferment period," the eight ordered cranes will face a total tariff of up to 270%, amounting to approximately $302.4 million. He warned: "This will have a devastating impact on our ability to invest in terminals and meet future freight demands, as well as on job opportunities in this region and across the nation."

Kathy Metcalf, president of the American Maritime Shipping Chamber (CSA), which represents 21 U.S. enterprises owning, operating, or leasing ocean tankers and container ships, stated that the proposed tariffs run counter to the goals of ongoing U.S.-China trade negotiations.

"Based on the productive discussions between the U.S. and China earlier this month in Geneva... we believe that negotiating tariffs on goods and services, and then attempting to impose tariffs, port fees, and crane taxes on transportation tools used for actual transport and shipment of goods, is counterproductive," she said.

Besides attempting to impose tariffs on Chinese cranes, the Trump administration previously came up with the "devious plan" of charging fees for ships built in China entering U.S. ports.

On April 17, the USTR website released a federal bulletin stating that all ships built in China and owned by Chinese entities, once docked at U.S. ports, would be charged fees based on the quantity of their cargo. These measures will be implemented in 180 days, divided into two phases.

According to the details of the charges published in the bulletin, in the first phase, starting October 14 this year, the U.S. will charge so-called "shipping service fees" at a rate of $50 per net tonnage for any ships operated by Chinese operators or owned by Chinese entities. This amount will increase annually by $30 over three years, reaching $140 per net tonnage by 2028.

For shipping service providers using ships built in China, fees will be charged based on either the ship's net tonnage or the number of containers, whichever is higher. This amount will also increase annually, starting at $18 per net tonnage and rising to $33 by 2028. Another standard charge is $120 per container, increasing to $250 by 2028.

There is a separate charge standard for non-U.S.-built ships carrying automobiles, starting at $150 per car equivalent unit (CEU).

In the second phase starting three years later, i.e., beginning in 2028, the USTR will limit foreign-built ships from engaging in liquefied natural gas transport business. Over the following 22 years, there will be a gradual requirement to increase the proportion of ships flying the U.S. flag and operated by U.S. entities until this proportion reaches 15% by 2047.

Prior to the public hearings held on March 24 and 26 regarding the "charging fees for ships built in China entering U.S. ports," more than 300 trade associations and other relevant parties provided testimony and expressed public opinions. There were even fierce conflicts between U.S. industry representatives and lawmakers. Many people warned in letters and testimonies that "the U.S. does not have the capability to win this war."

The new compromise proposal put forward by the U.S. side has not dispelled industry concerns. Bloomberg noted that particularly under the circumstances where Trump has already sparked a global tariff war, many people warned that this fee plan, in addition to disrupting international shipping, amounts to a form of "disguised tax." It not only exacerbates the heavy burden of Trump's numerous, staggering tariffs but also further intensifies the already tense trade conflict between the two major world economic powers, the U.S. and China.

In response to the U.S. suppression of ships built in China, on April 10, Chinese Foreign Ministry spokesman Lin Jian responded at a regular press conference, stating that the development of China's shipbuilding industry is the result of enterprise technological innovation and active participation in market competition, making important contributions to the development of global trade and the stable and safe operation of the global supply chain. Several U.S. research reports show that the U.S. shipbuilding industry lost its competitive edge years ago due to excessive protectionism. Blaming China for its own problems lacks factual basis and runs counter to economic common sense. The unilateralist and protectionist practices of the U.S. are unpopular and will only drive up global maritime costs, disrupt the stability of global production and supply chains, harm the interests of countries around the world, and ultimately fail to revitalize the U.S. shipbuilding industry.

This article is an exclusive contribution by the Observer Network and cannot be reprinted without permission.

Original text: https://www.toutiao.com/article/7506326286940258870/

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