The United States Trade Representative’s (USTR) Section 301 investigation into China’s shipbuilding and maritime sectors has drawn global attention and caused great concern. As the International Chamber of Shipping (ICS) made clear during its testimony at the USTR’s public hearing in March, the proposed measures, especially the imposition of discriminatory port-call fees on Chinese-built vessels, risk serious unintended consequences. Far from addressing the structural challenges of global shipbuilding, these measures threaten to disrupt international trade flows, inflate shipping costs, and damage the very US industries they aim to “protect”.
The hearings in Washington, DC, held on March 24 and 26, revealed a rare moment of unity across sectors. Representatives from global shipping companies, agricultural exporters, energy producers, manufacturers, and US port authorities spoke with one voice: The proposed actions would raise costs, reduce shipping capacity, and jeopardize US exports. ICS Secretary General Guy Platten was among over 60 witnesses who testified before an interagency panel that included the US departments of agriculture, energy, treasury, and homeland security. The conclusion was inarguable: This is not a targeted remedy — it is a blunt policy tool that would harm global commerce and US competitiveness alike.
As was emphasized by ICS during the hearing, ships are not defined by the flag they fly or the country they call at but by the global supply chains they serve. The proposed port fees, which could add hundreds of thousands, or even millions, of dollars to the cost of each US port call, would apply indiscriminately to vessels built in China, regardless of where they are owned or operated. This fails to reflect the reality of today’s maritime industry.
A particularly vivid example is found in the experience of ICS Chairman Emanuele Grimaldi, one of Europe’s most prominent shipowners. Over half of the Grimaldi Group’s current fleet was built in Chinese shipyards. As of this moment, the company has 20 more vessels under construction in China, and it soon plans to place orders for an additional 10 passenger ferries with Chinese shipbuilders. These ships are not built because of politics, they are built because China currently offers the industrial capacity, technical know-how, and delivery timelines the global market demands. If such vessels are suddenly penalized for simply entering US ports, the ripple effects will be felt across continents, including in Europe and North America.
During the hearing, a representative of the American Soybean Association warned that US agricultural exports could fall by as much as 64 percent for certain commodities if shipping costs rise dramatically. A soy farmer testified that rising freight charges would push global buyers toward competitors in Brazil or Canada. Energy exporters voiced similar concerns, noting that liquefied natural gas shipments to Asia and Europe, markets where US supply is critical, would become economically unviable. These are not hypothetical scenarios; they are foreseeable consequences of a policy that targets infrastructure already integrated into global trade.
The global shipping industry is one of the most cost-optimized sectors in the world. Its success depends on predictability and efficiency, not political fragmentation. The ICS emphasized at the hearing that these measures will not disincentivize Chinese industrial policy. Instead, they will isolate the US from the very vessels that carry its exports and imports, while exposing American exporters to higher transportation costs, reduced access to capacity, and increased uncertainty.
Several US port authorities have already expressed concern that the proposed fees would divert vessel calls away from the US, particularly from small and medium-sized ports. This would not only reduce cargo volumes but also threaten port employment and investment. Moreover, the administrative ambiguity of the proposed measures, such as the definition of “operator” or the treatment of time-chartered vessels, raises serious operational and legal uncertainties for shipowners and charterers worldwide.
The ICS said it does not dispute the US government’s right to pursue fair trade but argued that the proposed remedies are disproportionate and disconnected from the strategic realities of the global shipping market. They target ships that are already built and operational, many of them owned by companies based in America’s closest allies. They penalize vessels that were ordered years ago, under commercial terms that cannot be reversed. And they risk pushing global shipping operators toward fleet decisions based on political risk, rather than operational efficiency, to the detriment of trade flows everywhere.
During the hearing, the ICS urged the USTR to consider more constructive options: policy tools that enhance shipbuilding competitiveness without harming the global trading system. These include support for technological innovation, green shipbuilding, and digitalization, all of which align with long-term industry trends and environmental goals.
The maritime industry is not a traditional business. It is a globally interdependent ecosystem. Any attempt to regulate it through unilateral measures without regard for its complexity will inevitably backfire. The ICS remains committed to collaborating with all stakeholders to ensure that policy decisions are grounded in practical reality and are aligned with the broader goals of economic stability and international cooperation.
Punishing global shipping will not reduce China’s shipbuilding capacity, but it will jeopardize the integrity of supply chains, weaken the US economy, and destabilize a maritime system that underpins 90 percent of global trade. In such a moment, prudence and partnership must prevail over protectionism.
The author is a lawyer and principal representative of the International Chamber of Shipping (China) Liaison Office.
The views do not necessarily reflect those of China Daily.
