China Rejects US Shipbuilding Investigation as Protectionist

China’s Ministry of Commerce has criticized a US investigation into the country’s shipbuilding, maritime, and logistics industries, labeling it as driven by “unilateralism and protectionism.”

On Thursday, the US Trade Representative’s (USTR) office announced findings that China’s strategic efforts to dominate these sectors were “unreasonable” and potentially “actionable” under US trade laws. This expanded on earlier updates about the high-profile shipyard investigation.

While the USTR report did not recommend specific penalties against Beijing, it left the decision on potential actions to president-elect Donald Trump, who assumes office on Monday.

The USTR stated, “China’s targeting of the maritime, logistics, and shipbuilding sectors for dominance is unreasonable and burdens or restricts US commerce and thus is actionable.” The investigation was launched in April last year at the request of President Joe Biden, following pressure from several American unions.

The report alleges suppressed labor costs, forced technology transfers, and intellectual property theft among its key accusations. The unions behind the investigation have called for measures such as tariffs or increased 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,” stated a report from Greek broker Intermodal.

By contrast, Japan and South Korea’s combined share of global shipbuilding orders has fallen from 78% in 2000 to just 31% today.

President-elect Trump has signaled interest in collaborating with Japanese and South Korean shipyards to develop strong non-Chinese alternatives for the future.