The legislation follows action to counter Chinese shipbuilding from the Office of the United States Trade Representative and the White House.
U.S. shipyards produce 0.2% of the world’s vessels while China supplies 74%, according to the White House. This contrast is striking on its own, but it’s all the more alarming when put in further context. The United States was once the world’s leading shipbuilder, producing 15 to 25 new ships annually in the 1970s. That strength played a critical role in America’s WWII efforts and contributed to the nation’s economic success. However, as the Chinese Communist Party aimed its sights on dominating the global shipbuilding sector through unfair and anti-competitive non-market practices, U.S. shipyards have languished. Today, there are only 80 U.S.-flagged vessels in international commerce while China boasts 5,500.
But Congress is battening down the hatches and working to revitalize the U.S. shipbuilding supply chain. On Wednesday, Sens. Mark Kelly (D-Ariz.) and Todd Young (R-Ind.), alongside Reps. John Garamendi (D-Calif.) and Trent Kelly (R-Miss.), reintroduced the Shipbuilding and Harbor Infrastructure for Prosperity and Security (SHIPS) for America Act, which endeavors to revitalize U.S. shipbuilding by creating oversight and consistent funding for U.S. maritime policy and would establish a national goal of expanding the U.S.-flag international fleet by 250 ships in 10 years.
The SHIPS for America Act, which was first introduced in December, would:
- Establish a Maritime Security Trust Fund to reinvest duties and fees collected from the maritime industry into maritime security programs and maritime commerce infrastructure
- Create an interagency Maritime Security Board, led by a Maritime Security Advisor, that would make whole-of-government strategic decisions for a national maritime strategy
- Establish a 25% investment tax credit for shipyard investments and create a Shipbuilding Financial Incentives program to support innovation in domestic shipbuilding and ship repair
- Support a Maritime Workforce Promotion and Recruitment Campaign for workforce incentives
“After decades of dangerously neglecting our shipbuilding industry, we’re finally doing something about it. The SHIPS for America Act is the most ambitious effort in a generation to revitalize the U.S. shipbuilding and commercial maritime industries and counter China’s dominance over the oceans,” said Sen. Kelly, a U.S. Navy veteran and the first U.S Merchant Marine Academy graduate to serve in Congress.
“America has been a maritime nation since our founding, and seapower was a significant contributor to our rise to being the most powerful nation on earth. Unfortunately, the bottom line now is America needs more ships,” Young, a Naval Academy graduate, said. “Shipbuilding is a national security priority and a stopgap against foreign threats and coercion. Our bill will revitalize the U.S. maritime industry, grow our shipbuilding capacity, rebuild America’s shipyard industrial base, and support nationwide workforce development in this industry. This legislation is critical to our warfighting capabilities and keeping pace with China.”
Sens. Lisa Murkowski (R-Ark.) and John Fetterman (D-Penn.) are co-sponsors for the legislation, which has garnered endorsement from the Alliance for American Manufacturing, the United Steelworkers, the Shipbuilders Council of America, and a bevy of other organizations and businesses.
“With China’s growing influence in the global maritime sector, the United States can no longer afford to overlook our maritime industries,” said Garamendi. “The SHIPS for America Act will give our shipyards and merchant mariners the tools they need to rebuild America’s maritime industry and create good-paying American jobs.”
In recent months, the White House has also taken action to counter China’s shipbuilding dominance both with an executive order and action from the Office of the United States Trade Representative (USTR). On April 9, President Donald Trump called for the development of a Maritime Action Plan that assesses how available authorities and resources can be used to invest in and expand the maritime industrial base. And, on April 17, following a Section 301 investigation into China’s shipbuilding practices, USTR announced that it will phase in escalating fees on Chinese-built vessels and foreign-built car carrier vessels.