Additionally, the study found that the proposed fees would lead to a decrease in overall employment in the country by 1.4 million jobs, with the manufacturing and transportation sectors being hit the hardest. This would result in a loss of $20.7 billion in wages for American workers.
Furthermore, the study predicts that the proposed fees would have a negative impact on the environment, as carriers would be incentivized to use larger vessels that emit more greenhouse gases, leading to an increase in carbon emissions and pollution.
It is clear from the submissions and studies that the proposed actions by the USTR to counter Chinese dominance in the shipbuilding industry could have far-reaching and detrimental effects on the US economy, businesses, and workers. As the deadline for public comments approaches, it remains to be seen what decision president Trump will make regarding this issue.
The Impact of US-China Trade Restrictions on Global Shipping
In recent months, the trade tensions between the United States and China have escalated, leading to a series of restrictions that are set to have far-reaching implications on global shipping. One of the key sectors that will be affected is the export of petroleum and coal products, which is expected to decline by 8.11% due to the new regulations.
Ohio-based grains giant, The Andersons, has also voiced concerns about the potential economic impacts on American farmers as Chinese tonnage is singled out. The company predicts that the restrictions will result in substantial cost increases for grain vessels, with prices per bushel expected to rise by 10% to 30% depending on the port of call.
Furthermore, the American ports body has warned that the new fees imposed on port calls could lead to cargo diversion to Mexican and Canadian ports. This shift in shipping routes could result in increased transportation costs and logistical challenges for US importers and exporters.
The looming trade restrictions have already started to impact the shipping market, with Chinese-linked ships becoming less attractive for long-term charters. Law firms and industry analysts are also seeing revisions to charter-party agreements in anticipation of the clampdown on Chinese-built tonnage by the US.
China’s dominance in the shipbuilding industry poses a significant challenge for the US, which has a much smaller market share. The gap in industrial infrastructure between the two countries has been highlighted by Chinese media, which argues that America’s decline in manufacturing has left it ill-equipped to compete in industries like shipbuilding.
As the trade restrictions take effect, it is clear that the global shipping industry will face significant challenges. It remains to be seen how stakeholders will adapt to the new regulations and navigate the changing landscape of international trade.