The Sinking Feeling: US Congress Grapples with China’s Shipbuilding Supremacy

The US Congress has launched a new initiative to counter China’s dominance in commercial shipbuilding, a sector that has become a focal point for tensions between the two nations. At its core, this effort is about America’s waning grip on the high seas.

A recent congressional hearing highlighted lawmakers’ growing sense of urgency to address what they see as a crippling trade imbalance in shipbuilding. Representative Young Kim asked pointed questions about imposing targeted tariffs or port entry fees on Chinese-built vessels, while Representative Ami Bera noted that America is “falling further and further behind China.” The sentiment among lawmakers is clear: Washington needs to find a way to level the playing field.

Shipbuilding is not just an economic issue; it’s also a national security concern. The close ties between naval power and shipbuilding capabilities mean that whoever controls the latter also holds sway over the former. This has significant implications for global maritime trade, which is projected to grow exponentially in the coming years.

China’s rapid rise in commercial shipbuilding has been facilitated by its state-backed shipbuilders, which have become a thorn in the side of American policymakers. Beijing has denied allegations that it uses state support to expand its industry, but data from the United Nations’ Conference on Trade and Development (UNCTAD) tells a different story: China’s share of global shipbuilding capacity has risen dramatically over the past decade, while America’s has stagnated.

Historically, the US was a dominant player in commercial shipbuilding, but its industry has struggled with declining orders, rising labor costs, and inadequate government support. Meanwhile, Chinese state-owned enterprises have received lavish subsidies and tax breaks to build their own infrastructure and attract international clients. This has created an uneven playing field that American policymakers are now scrambling to rectify.

Proposed solutions in Congress – tariffs, sanctions, and port entry fees – are stopgap measures aimed at slowing China’s momentum without fundamentally altering the underlying dynamics of the market. However, as Representative Ami Bera noted, this won’t be enough to catch up with China on its own terms. America needs a comprehensive strategy that addresses the root causes of its decline in shipbuilding and provides targeted support for domestic industries.

One potential avenue being explored is reviving the US Merchant Marine Act of 1936, which provided subsidies and loans to American shipbuilders during World War II. This legislation helped establish the US as a major player in commercial shipping, but its provisions were phased out after the war. Reviving such measures could provide much-needed relief to struggling American shipyards.

As global maritime trade continues to evolve, one thing is clear: America can’t afford to cede control of the high seas to China. The consequences would be far-reaching, with implications for national security, economic power, and even global governance. This isn’t just about tariffs or sanctions; it’s about preserving America’s status as a major maritime power.

The stakes are high, but so is the potential payoff. By investing in its own shipbuilding industry and providing targeted support to domestic enterprises, America can reclaim its position at the forefront of commercial shipping. It won’t be an easy road ahead, but one thing is certain: the US Congress must act decisively to counter China’s rising tide and restore American dominance on the world’s oceans.

The future of maritime trade will be shaped by this titanic struggle between two superpowers. As America grapples with its own decline in shipbuilding, it must confront the hard truth that its national security and economic power are tied to the fate of its commercial fleet. The outcome is far from certain, but one thing is clear: only time will tell if the US Congress can stem the tide and keep China’s shipbuilding juggernaut at bay.