- South Korea and the U.S. are discussing a shipbuilding partnership, with Seoul aiming for tariff concessions and Washington seeking industrial revival to compete with China’s naval rise.
- The initiative includes potential South Korean investments in U.S. shipyards, naval ship repair, and joint construction projects, but faces regulatory and workforce challenges.
- Trump’s historical interest in Korean shipbuilding and recent actions by major Korean firms like Hanwha and HD Hyundai indicate strong momentum—though political will is key.
South Korea and the United States are exploring a potential shipbuilding collaboration that could involve South Korean investments in modernizing U.S. shipyards and assisting with the maintenance of U.S. Navy vessels. In return, Seoul is seeking improved tariff conditions as pressure mounts from Japan’s recent trade deal with Washington. South Korean trade officials are currently in the U.S. to continue negotiations, though a scheduled high-level meeting was postponed, according to Reuters.
Geopolitical Context: U.S. Seeks Edge Against China
The strategic importance of this proposed alliance is heightened by China’s rapid maritime growth. With over 234 warships, China now surpasses the U.S. Navy in fleet size. The U.S., under President Donald Trump’s renewed focus on revitalizing the domestic shipbuilding industry, is increasingly looking to South Korea’s advanced capabilities to help counterbalance Beijing’s rise.
South Korea’s Leverage Through Shipbuilding
Kim Suk Kyoon, a maritime strategy expert and former Korea Coast Guard commissioner, stated that shipbuilding offers Seoul its most viable leverage in tariff negotiations. South Korea, the world’s second-largest shipbuilder, is proposing a “Korea-U.S. manufacturing renaissance partnership,” focusing on sectors like shipbuilding to foster mutual growth and strategic alignment.
Hanwha and HD Hyundai Lead Expansion in U.S.
Hanwha Ocean, which now operates the Geoje shipyard once visited by Trump in 1998, has already secured three maintenance contracts with the U.S. Navy. Its parent company, Hanwha Group, has also expanded its U.S. footprint by acquiring Philly Shipyard for $100 million and jointly building an LNG carrier between that yard and Geoje.
Furthermore, Hanwha has received U.S. approval to increase its stake in Australian shipbuilder Austal, which operates a major U.S. Navy shipyard in Alabama. HD Hyundai, another major Korean shipbuilder, partnered this year with U.S.-based Huntington Ingalls and Edison Chouest Offshore to collaborate on commercial and defense shipbuilding in the U.S.
Challenges: Regulations and Workforce Constraints
Despite growing cooperation, several obstacles remain. U.S. shipyards face difficulties sourcing components and skilled labor. Additionally, regulatory constraints such as the Jones Act and the Byrnes-Tollefson Amendment prohibit foreign-built ships from operating domestically or being used by the U.S. Navy. However, these restrictions could be bypassed through presidential waivers or innovative approaches such as modular shipbuilding or special district designations for Korean yards.
Trump’s Longstanding Interest in Korean Shipbuilding
Donald Trump’s fascination with South Korean shipbuilding dates back to a 1998 visit to the Daewoo shipyard in Geoje—now operated by Hanwha Ocean. Accompanied by his son Donald Trump Jr., Trump toured the site via helicopter and visited a towering 100-meter crane. Lim Moon Kyu, a former Daewoo executive who hosted Trump, recalled him being visibly impressed, repeatedly saying, “Wonderful, wonderful.”
Lim believes that the visit left a strong impression on Trump and may be contributing to his current openness to deeper cooperation with Korean shipbuilders, viewing it as a strategic asset to challenge China’s maritime dominance.
Looking Ahead
As South Korean shipbuilders expand their U.S. presence and policymakers on both sides weigh the economic and strategic benefits, this proposed partnership could mark a turning point for both nations. However, its success will depend heavily on political alignment, regulatory flexibility, and the ability to overcome operational hurdles in U.S. yards.
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Source: Reuters
