Recently, David Doddwell, a well-known American think tank expert, published a commentary article in the South China Morning Post, a well-known international media in Hong Kong, discussing the challenges of the United States in rebuilding its shipbuilding industry.
While the U.S. government intends to reduce its dependence on China in shipping and logistics and to try to revive its shipbuilding industry through investment and policy, this goal appears unrealistic given China's global leadership and the long-standing neglect of the U.S. in this area, the article argues.
The article also mentions China's dominance in global shipbuilding, container manufacturing, port crane supply, and port logistics software, as well as the "potential impact" of these factors on U.S. national security.
The challenge of the American shipbuilding industry is the advantage of China
In recent years, the United States' position in the global shipbuilding industry has gradually declined, and China has become the industry leader by an overwhelming advantage.
According to the latest data from the United Nations, China's shipbuilding industry has risen from obscurity to the pinnacle of the industry over the past 30 years.
By the end of 2023, China's shipbuilding industry accounted for more than half of global new ship orders by gross tonnage, South Korea accounted for about 30%, Japan just over 10%, and the United States had a share of less than 0.01%, Clarksons data showed.
The U.S. government is deeply aware of the adverse effects of this dependency, and has actively promoted the "de-risking" of the supply chain after the epidemic, trying to restore and improve the capacity of the domestic shipbuilding industry through various measures.
President Biden's executive order and the demands of the United Steelworkers reflect the urgency of the U.S. government to improve port infrastructure and cybersecurity. However, despite the Biden administration's plan to invest $20 billion in improving port infrastructure, truly reviving the U.S. shipbuilding industry remains a long-term and daunting task.
The success of China's shipbuilding industry lies not only in its scale advantage, but also in its comprehensive industrial chain and efficient logistics management capabilities.
Most of the new large port cranes and nearly all containers made in China dominate the world. The application of these equipment and technologies has greatly improved the loading and unloading efficiency and operational capacity of ports around the world.
However, the United States faces difficulties on many fronts in trying to challenge China's leadership in the shipbuilding industry.
From backward technology, incomplete industrial chain to lack of professional talents, these problems cannot be solved in a short period of time. In addition, Logink, China's logistics software platform, has been widely used around the world, and its efficient data processing capabilities and network support are currently difficult to match in the United States.
A series of U.S. policy attempts, including banning the use of Chinese-made ships and containers, appear to be national security concerns, but could have a significant negative impact on U.S. trade and logistics itself.
If the U.S. does cut ties with a global shipbuilding and logistics management leader like China, it could seriously affect U.S. position and efficiency in the global supply chain.
In my opinion, these moves by the United States, although they are motivated by security considerations, are too conservative and even paranoid in terms of strategy.
In today's deepening globalization, cooperation and win-win cooperation are the best way for interaction between countries. The United States should think more about how to cooperate with China and other major shipbuilding countries to jointly promote the development of the global shipbuilding and logistics industry, rather than unilaterally building barriers.
The current situation and future trends of the world marine market
The current dominance of the global marine market is firmly controlled by China, and South Korea and Japan are also important shipbuilders. The combined strengths of the three countries pose a great challenge to the United States.
China's outstanding performance in the field of shipbuilding lies not only in its numerical superiority, but also in its overall leadership in technology and efficiency. For example, China's State Shipbuilding Corporation recently received an order from Qatar Energy to build 18 liquefied natural gas (LNG) carriers in the world.
In the future, with the global fleet transitioning to green energy, the demand for new ships with low carbon or no carbon emissions will increase dramatically.
China's deep technical reserves and production capacity in this field will enable it to continue to maintain its leading position in the green ship market in the future. In contrast, if the United States wants to catch up, it will not only need huge investment, but also time to cultivate relevant technologies and industrial chains.
The U.S. government's current policy attempts, including legislation and executive orders, to boost the capabilities of its shipbuilding industry are ostensibly aimed at enhancing national security and economic autonomy. However, this strategy ignores a central issue: industrial complementarity in a globalized economy. The U.S. and China have deep economic and technological complementarities in many areas, and unilateral actions could negatively impact that relationship, ultimately hurting U.S. economic interests.
The shipbuilding industry in the United States was once brilliant, but due to long-term neglect and market changes, it has lost its competitiveness with major shipbuilding countries in Asia. To truly restore or upgrade this industry, it is not only the government's financial investment, but also a new market strategy and international cooperation perspective.
In the long term, the U.S. should consider forging closer partnerships with China and other shipbuilding powers to jointly promote development and innovation in the global shipbuilding industry. For example, we will enhance the competitiveness of U.S. companies through international cooperation in technology research and development, the manufacture of environmentally friendly ships, and the construction of service networks in the global market.
A little summary
In pursuing its own security and economic interests, the United States should pay more attention to international cooperation and the practical needs of the market, rather than unilateral protectionism or Sinophobia.
Cooperation and openness, rather than closure and confrontation, will be key for the United States to regain its competitiveness in the global shipbuilding industry.
The United States is facing a challenge that requires strategic wisdom and foresight, and unwarranted suspicion and confrontation with China will not only not help solve the problem, but may miss opportunities for cooperation and win-win results.
In the context of global economic integration, the United States should choose partners more wisely and jointly contribute to the future global shipping market.