FT: Shipbuilding: the new battleground in the US-China trade war

Photo: © Alexlmx

THE FINANCIAL TIMES reports:

Shipping has been at the centre of the global economy for over 5,000 years, and it is no less important now than it was for our seafaring ancestors. For all our technological advances, it is still the most effective means of importing and exporting goods and raw materials.

It remains crucial to national security, not just for the long-standing role it has played in the defence of nations and of trade but also because today’s port software and logistics platforms hold crucial data about which countries and companies are moving goods around the world. Even Adam Smith, the father of modern capitalism, believed that shipbuilding was one of the very few industries that deserved national support and should not be left to market forces alone.

That’s a key part of the argument being made in a new petition for trade relief and state support of the US shipbuilding industry under a so-called section 301 case filed by the United Steelworkers union and other labour organisations on March 12.

The petitioners accuse China of distorting global markets in the maritime, logistics and shipbuilding sectors through “unreasonable and discriminatory acts, policies, and practices”.

The petition, which the US government now has 45 days to respond to, seeks a variety of penalties and remedies to level the global playing field in shipbuilding and stimulate demand for commercial vessels built in the US. These include port fees on Chinese-built ships docking at US ports, and the creation of a Shipbuilding Revitalisation Fund to help the domestic industry and its workers.

A case that might appear focused on one industry in fact has dramatic global implications. Not only does it have the potential to reignite the US-China trade conflict, but it will also increase the focus on China’s growing military might and the massive commercial shipping industry that underpins it. At the same time, it raises questions about America’s ability and even willingness to reindustrialise in strategic sectors, which may bleed into the 2024 presidential election…

The full post is here.