YANTAI, CHINA – JANUARY 12: Two offshore drilling rigs undergo maintenance at a berth at a shipyard in Yantai, Shandong Province, China, on January 12, 2025. According to a report by Clarkson Research, China has consolidated its leading position in the global shipbuilding industry in 2024, receiving two-thirds of orders. (Photo: Tang Ke/VCG via Getty Images)
VCG | Visual China Group | Getty Images
The U.S. Trade Representative’s office said on Thursday it found China’s targeted dominance in global shipbuilding, maritime and logistics to be “unreasonable” and “actionable” under U.S. trade law.
An investigation by the U.S. Trade Representative’s Office, first reported by Reuters on Tuesday, did not include specific recommendations for penalties against Beijing, leaving the next steps to be determined by President-elect Donald Trump, who takes office on Monday.
The Office of the U.S. Trade Representative said its report “supports China’s decision to seek dominance in the maritime, logistics and shipbuilding industries, which is unreasonable and burdens or restricts U.S. commerce, and therefore warrants action.”
The Chinese Embassy in Washington could not immediately be reached for comment on the investigation.
U.S. Trade Representative Katherine Tai launched the investigation in April 2024 at the request of the United Steelworkers and four other U.S. unions under Section 301 of the Trade Act of 1974, which allows the U.S. Punishing foreign countries that engage in conduct that is “unreasonable” or burdens U.S. commerce.
Section 301 is a law that Trump and President Joe Biden have imposed high tariffs on Chinese imports since 2018.
Tai said in the statement that U.S. commercial shipbuilding has dropped from 70 ships per year in 1975 to less than five ships per year, while China now builds 1,700 ships per year.
“Beijing’s targeted dominance of these industries undermines fair, market-oriented competition, increases economic security risks, and is the greatest obstacle to the revitalization of U.S. industries and the communities that rely on them,” Tai said.
“These findings under Section 301 lay the foundation for urgent action to invest in America and strengthen our supply chains,” she said.
International Steelworkers President David McCaul welcomed the report, calling it a “firm and undeniable indictment that demands a swift and decisive response from the new administration,” noting that Trump has expressed a willingness to pursue China’s responsibility.
The Trump transition team had no immediate comment.
The report found that China’s dominance in shipbuilding, maritime and logistics was due to Beijing’s “extraordinary control” over companies in these fields, depriving market-oriented companies of business opportunities. This in turn reduces competition and increases dependence on China.
The report found that Chinese industries benefited from China’s lack of effective labor rights, overcapacity in steel production and controls on digital logistics services.
U.S. Senator Mark Kelly said the report illustrates the need to revitalize the U.S. shipbuilding and maritime industries, including through legislation to achieve this goal.
“The People’s Republic of China’s unfair trade practices allow China to dominate the oceans while harming American workers and our national security,” Kelly said.
