- Executive Order Aims to Reduce Chinese Dominance in Shipbuilding.
- Trump Announces Creation of White House Office of Shipbuilding.
- Fast-Tracking Long-Delayed Legislative Proposals.
The Trump administration is drafting an executive order to revive American shipbuilding and curb Chinese dominance in the world’s maritime industry. The draft summary, seen by The Wall Street Journal, presents a set of actions intended to enhance the domestic maritime industry and support national security, reports MSN.
Key Measures in the Draft Executive Order
The suggested executive order contains eighteen provisions that are aimed at raising revenue and increasing investments in the maritime sector. Some of the most important provisions include new charges on Chinese-constructed ships and cranes arriving at U.S. ports, establishing a new office at the National Security Council to enhance the domestic maritime industry, and increasing wages for nuclear shipyard workers. In addition, the order directs Elon Musk’s Department of Government Efficiency to examine government purchasing operations, including those for the Navy.
Trump’s Vision for Shipbuilding
During his speech to Congress, President Trump emphasized the urgency of resurrecting commercial and military shipbuilding in the United States. He announced plans to establish a new Office of Shipbuilding within the White House, highlighting the importance of reducing reliance on foreign-built ships. In his address, Trump stated, “We’re going to make them very fast, very soon,” reinforcing his administration’s commitment to rebuilding the industry.
Legislative and Political Background
Most of the proposals in the draft executive order have been languishing in Washington for years, awaiting progress that was interrupted by a long legislative review. Among them are bills pending in Congress to spur U.S. shipbuilding and suggestions by the U.S. Trade Representative’s office to charge Chinese-built or Chinese-flagged ships to enter U.S. ports. The executive order offers the avenue to speed up these initiatives without the long legislative process.
Influence of National Security Adviser Mike Waltz
As per one shipping industry executive, Trump’s national security adviser, Mike Waltz, played a strong role in drafting the executive order. During his time in Congress, Waltz co-sponsored bicameral legislation to increase the U.S.-flagged fleet and provide domestic shipbuilders with financial assistance and tax breaks. His involvement highlights the administration’s emphasis on national security as one of the chief reasons for boosting the maritime sector.
Economic and National Security Implications
National security interests have increasingly motivated bipartisan initiatives to place the maritime sector at the forefront, as most lawmakers are concerned that the loss of U.S. shipbuilding has exposed the nation to threats. The draft order proposes major financial measures, such as the establishment of Maritime Opportunity Zones to attract investments and the creation of a Maritime Security Trust Fund. Funds raised from Chinese crane and ship fees would be used to finance domestic maritime investments.
Industry Resistance to Suggested Fees
Suggested fees on ships built by Chinese companies have received resistance from Asian and European ocean shipping firms. China is the world’s biggest producer of containerships, with 29 per cent of ships in operation measured in terms of container capacity and 70 per cent of new containership capacity under the order. Industry executives are concerned that these fees may interfere with trade and raise shipping prices.
Soren Toft, CEO of Geneva-based Mediterranean Shipping, the world’s largest container line, voiced concerns at the TPM25 shipping conference in Long Beach, California. He warned that if the Trump administration implements the proposed fees, “Carriers will be forced to pull services from some smaller U.S. ports as it wouldn’t be worth the cost of unloading small volumes of containers.” Toft further stated that shipping costs on some routes from Asia to the U.S. could rise by as much as $800 per 40-foot container, with the additional costs ultimately being passed on to importers and consumers.
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Source: MSN
