New US tariffs on Chinese ships risk global trade turmoil
Proposed American fees on Chinese ships could cause chaos in global trade, experts warn in "Bloomberg." In Germany, the transport of 17,600 tons of steel pipes to the US has been halted. Americans want Chinese operators to pay from $1 million to over $3 million for each entry of a Chinese ship.
The Donald Trump administration is proposing fees for using Chinese commercial ships, which is intended to combat China's dominance in maritime trade. The problem is that the American proposal could significantly impact global trade, much more than potential tariffs.
As reported by "Bloomberg," the symbol of chaos in the changes pushed by the Trump administration is the delay of 17,600 tons of steel pipes in Germany. Dockworkers there should be preparing a large shipment to the US for a significant project in Louisiana. Due to the changes, the cost of sea transport could increase two to even three times, causing goods to be stuck in Europe.
The US wants to curb China's power at sea
"Talks over the terms for shipping the pipes were put on hold until there’s more clarity," Jose Severin, business development manager at Mercury Group responsible for the deal, told "Bloomberg." On this transatlantic route (Germany-US), as reported, 80 percent of the ships used by the operator were built in China.
If for each transport by a Chinese operator's ship there is an additional fee to Americans from $1 to $3 million, costs could soar into billions of dollars. According to Clarksons Research Services, the fees could bring the US from $40 to $52 billion. However, Joe Kramek of the World Shipping Council warns that such actions could raise prices and threaten jobs. "If you wanted to take a sledgehammer to trade this is what you would do," the maritime transport expert stated.
The proposal from the United States Trade Representative (USTR), aimed at limiting China's dominance in shipbuilding, logistics, and maritime industries, comes at a time when Beijing produces over half of the world's cargo ships by tonnage. Together with South Korea and Japan, Asian giants produce over 90 percent of such vessels, demonstrating the scale of dominance. The US share in these figures is negligible (0.01 percent).
Industry representatives, like Jonathan Gold of the National Retail Federation, are concerned that the new fees may cause more harm than the previous tariffs. "They see this as more of a threat than the tariffs, because of the impact it’s going to have on the supply chain," said Gold. Many companies fear that fees could lead to withdrawal from smaller ports, affecting local economies.
