China’s Dominance of Global Shipbuilding Warrants U.S. Action, USTR Investigation Concludes

For Immediate Release: January 16, 2024

Washington, D.C. - China has unfairly advantaged its maritime, logistics, and shipbuilding industries through non-market policies and warrants "urgent action," the U.S. Trade Representative (USTR) announced on Thursday. The determination comes as the office advances its Section 301 investigation, which was launched in April 2024.

"China has warped the global market to its advantage for decades," Alliance for American Manufacturing President Scott Paul said. "These actions have undermined the opportunity for America's shipyards and factories to compete, harming the hardworking men and women who keep our country strong.

"We applaud the United States Trade Representative and Biden administration for pursuing this important investigation and look forward to informing the process of developing responsive actions during the next administration," Paul said. "Failing to take decisive action will leave our shipbuilding capabilities at the mercy of Beijing's persistent predatory market distortions."

Though the United States employed more than 180,000 workers at its height in 1975, producing more than 20 years a year. Now, it produces fewer than 5 oceanic commercial vessels annually while China produces more than 1,7000 each year. Furthermore, China has more than 5,500 flagged merchant vessels in oceangoing service while the U.S. has fewer than 80.

"The United States was once a global leader in the shipbuilding industry. That preeminence was a deciding factor in past world conflicts. We have allowed China to erode our shipbuilding capacity for far too long and dramatically lost valuable manufacturing capacity," Paul said. "The consequences have been fully felt on an economic level, and we hazard enormous damage to our national security as well if we continue to grant China this dangerous upper hand."

On Jan. 7, The Department of Defense added Chinese shipping conglomerate China Ocean Shipping Company (COSCO) to its list of "Chinese military companies," in recognition of its ties to the People's Republic of China's (PRC) Military-Civil Fusion strategy.

An overwhelming majority (82%) of U.S. adults agrees that China's dominance of the global shipbuilding industry is concerning, according to polling conducted by Morning Consult on AAM's behalf in December 2023. Moreover, 76% agree that America's shipbuilding should not be dependent on foreign manufacturers.

Paul testified before the House Select Committee on the Chinese Communist Party on June 26, 2024, calling for quick action to counter Beijing's crooked shipbuilding and maritime practices. Find his full written testimony here.

On March 12, 2024, five national labor unions led by the United Steelworkers petitioned the USTR to launch its Section 301 investigation.

Paul is available for interviews.