WSC to US: Rethink tariffs or risk economic turmoil

The World Shipping Council (WSC) has urged the United States Trade Representative (USTR) to abandon its proposal for retroactive fees on port calls for Chinese-built vessels, citing both economic and industry impact concerns.

Although WSC has underscored its support for the USTR’s ambition of breathing new life into the US maritime sector, the organization has nonetheless expressed strong opposition to the $1.5 million fees the USTR announced in February 2025 that would be imposed on vessels calling at US ports which were either constructed in China or are on order to be built in the country.

As per WSC, the fee also entails the possibility of paying up to $1 million per port entry on any ship, whether or not that particular unit was built in China, for those operators that have some Chinese-built vessels in their fleet or orderbook.

The fees were unveiled as part of a set of measures the United States has taken in an attempt to ‘curb’ China’s position and influence within the shipping and, especially, shipbuilding sector.

However, the World Shipping Council has warned that the proposed tariffs could exacerbate inflation for US consumers as well as businesses, jeopardize jobs and ‘disproportionately’ harm United States-based farmers and other exporters.

Instead, WSC has placed utmost importance on the need to craft “more effective alternatives” to strengthen US shipbuilding without negatively impacting the broader economy.

Moreover, the organization has also voiced ardent disproval to the plan to limit the transport of US exports to a very small number of ships that are both US-flagged and US-built, citing it as a “slippery terrain” at a time of high geopolitical tensions.

“A strong US maritime sector will have positive ripple effects across the entire maritime industry. However, WSC strongly opposes the proposals in this proceeding for port fees and for requirements to use US-flagged or US-built vessels. These proposals will result in increased costs for U.S. exporters and consumers as well as supply chain inefficiencies while failing to provide China with effective incentives to alter its acts, policies, and practices,” WSC CEO Joe Kramek underscored.

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Furthermore, if adopted, Kramek stressed that the proposed port fees could generate congestion at larger ports while decreasing service at smaller ones as operators attempt to minimize the number of port calls made in the United States on each route.

He also argued that an “average-sized” containership (6,600 TEU) the route of which encompasses six US port calls could face fees that are two times higher than the combined inbound and outbound spot rate for shipping between New York and Rotterdam, the Netherlands—the largest port in Europe.

As divulged by Kramek, the port fees appear to go ‘well beyond’ what the law authorizes: “Generating demand for domestic products and raising government revenue–whether to support a domestic industry or for other purposes–are not permissible bases for actions under Section 301 of the US Trade Act of 1974, which was enacted for the purpose of inducing elimination of the foreign acts, policies, and practices at issue.”

Concerning this, the USTR said in January 2025 that China could, in fact, be actionable under Section 301, an investigative tool under US trade law that allows the USTR to pursue unilateral trade retaliation. However, rather than focusing on punitive actions, WSC has suggested that the United States government would benefit more from pouring its resources into revitalizing the domestic maritime industry as a whole.

“The Administration should work with Congress on a forward-looking strategy that is constructively designed to revitalize the U.S. maritime industry,” Kramek elaborated.

Over the past months, the United States government has taken some steps to revamp the domestic shipping and shipbuilding sectors. Striving to increase its capability to construct a larger number of vessels each year and support domestic shipyards to turn this vision into reality, the US has adopted a multi-pronged approach beyond the potential tariffs on Chinese-built ships.

Namely, at the end of December 2024, US lawmakers introduced the “New SHIPS for America Act”, crafted to rejuvenate the US Merchant Marine, strengthen domestic supply chains in peacetime, and ensure the nation’s ability to transport essential goods and military cargo during conflicts.

What is more, just two months after taking office for the second time, President Donald Trump announced in his first address to Congress in early March 2025 that a specially designated Office for Shipbuilding at the White House would be formed, intending to bring shipbuilding ‘back to where it belongs’.