The Observer Network by Nguyen Jaki
On October 10, China's Ministry of Transport announced that starting from October 14,"special port fees" will be charged to ships related to the United States in order to counter the unreasonable and erroneous practice of imposing port service fees on China-related ships in serious violation of relevant principles of international trade and the Sino-US Shipping Agreement. China's Ministry of Commerce issued a document late on the 10th, emphasizing that the relevant countermeasures are aimed at maintaining a level playing field in the international shipping and shipbuilding markets and are "legitimate defense."
According to Reuters, over the past two decades, China has grown into the world’s largest shipbuilding industry, with its large domestic shipbuilding facilities able to handle commercial and military shipbuilding projects at the same time.In April, Washington announced its decision to collect charges on Chinese ships as part of a comprehensive initiative to promote the recovery of the U.S. domestic shipbuilding industry and weaken China’s commercial shipping and naval strength.
A spokesperson for the Ministry of Transport of China criticized this on the 10th, saying,"The United States 'practices ignore the facts, fully expose its unilateralism and protectionist nature, have obvious discriminatory colors, and seriously damage the legitimate interests of China's shipping industry, seriously disrupt the stability of global supply chains, and seriously undermine the international economic and trade order. China will resolutely take countermeasures against the wrong practices of the United States in accordance with the law, promote the construction of a fair and just international shipping market order, and maintain the security and stability of the international logistics supply chain."
Reuters quoted analysts as saying that China's counter-measures mean that it is still difficult for China and the United States to break through the current tariff "truce". On August 12th, the Sino-US talks in Stockholm passed that the two sides once again suspended the implementation of the 24% tariff for 90 days, which will end on November 9th.
An oilseed trader of an international company that sells soybeans to China said, "This measure shows that China is still annoyed with the United States, and they are unlikely to resume importing agricultural products from the United States in the short term... This year, Chinese soybean crushing companies may give up Using American soybeans."
He added that China's countermeasures "may have limited direct impact on agricultural trade." After all, after the Trump administration provoked the tariff trade war in the United States, the scale of China's imports of agricultural products and energy products from the United States has been greatly reduced.
According to Bloomberg News, after China announced the new regulations, it quickly triggered a chain reaction in the global logistics industry. On Friday, a small number of oil tankers scheduled to deliver cargo to Chinese ports temporarily canceled their bookings. In addition, the cost of chartering dry bulk carriers transporting coal and iron ore has also increased.
According to Bloomberg's calculation, the threshold of the fee levied by China this time is RMB (about 56 USD) per ton of 400 yuan, which is equivalent to an additional fee of about 6.2 million USD (about 44.16 million RMB) per time that a giant oil tanker calls at the port. Analysts at investment bank Fearnley Securities wrote in a report, "For now, the impact is very significant."
“The U.S. has done this first, and China has only done it again,” said Peter Alexander, CEO of consulting firm Z-Ben Advisors, to the U.S. Consumer News and Business Channel.
“The Trump administration has been underestimating China, and this situation must stop. When they make policies, it seems that they rarely take into account the secondary and third-level chain reactions that policy choices may trigger,” Alexander added, “China has the ability to respond on a reciprocal basis and has shown a willingness to take direct action.
On October 10, in Qingdao, Shandong Province, Qingdao Port was busy with foreign trade operations and cargo ships were loading and unloading containers. Visual China
According to Hong Kong's South China Morning Post, Linerlytica, a container market intelligence company, said in a report released on Monday that because the size of the fleet operated or owned by the United States in China is relative to the size of the fleet operated by China in the United States, the actual impact of China's countermeasures may be "relatively limited".
But Hong Kong Media noted that the analysis report did not include the “ship owned or operated by U.S. entities with more than 25% stake” mentioned in China’s statement, according to the report, as U.S. private equity companies, banks and alternative financial institutions typically hold large shares in the maritime industry, the final total actual fee may be much higher than currently estimated.
Jayendu Krishna, director of Drury Shipping Consulting, also bluntly said when he mentioned this key element in a recent interview,"The devil is hidden in the details."
"If the ownership of ships that are financed through U.S. companies, listed on U.S. exchanges, or chartered by U.S. entities is recognized as U.S., then this could have a significant impact," he explained.
Kun Cao, vice president of consulting firm Reddal, also warned the Associated Press that China's countermeasures were "by no means symbolic".
"The new rules clearly target any ship that is materially related to the United States, whether it is ownership, operating rights, flag ownership, or whether the builder involves the United States, and the cost will increase significantly with the tonnage of the ship," he added,"The real impact will fall on ships owned and operated by the United States."
Bloomberg also noted that although many of the world's largest tanker operators are headquartered outside the United States, many of them are listed in the United States and have important U.S. shareholders.
Omar Nokta, an analyst at Jefferies Group, pointed out in the report that "the impact of this new fee framework in China should not be underestimated, because it will affect listed companies, especially those listed in the US market and whose domestic investment funds hold 25% or more of the shares."
On the other hand, a number of American shipping industry insiders complained that the U.S. announcement of imposing port fees on Chinese ships is still a "fog", and the operating process, scope of application and other issues of concern to the outside world are still unclear, which makes people feel "confused".
近日在新加坡举行的美国航运金融论坛“Marine Money Asia”上，美国律师事务所Holland & Knight的合伙人安德鲁·麦卡利斯特（Andrew MacAllister）指出，美国有关部门早前已承诺就费用流程提供常见问题解答，但至今未公布。
对于通过中国租赁公司融资的船舶是否会被纳入收费范围，新加坡律所Watson Farley & Williams的合伙人兼亚洲融资部门主管克里斯托弗罗斯·比斯比科斯（Christoforos Bisbikos）也表示，目前在这一问题上“尚不清楚”。
The "Maritime Trade News" earlier that the world shipping giant Danish Maersk Group, the French Dauphine Group announced that it will not charge additional charges on US-line goods on October 14, some non-Chinese shipping companies said they will move Chinese-built ships to routes that do not depend on the United States, and the Middle-Range Shipping Group, the East overseas shipping Co., Ltd. said it will continue to serve US-line customers.
Linerlytica also said in a report on Monday that by adjusting fleet deployments, the vast majority of non-Chinese carriers could circumvent U.S. charges.
However, the United States 'vicious attempt to use such a "poisonous trick" to curb China's maritime dominance failed to come true. The latest data shows that global shipping companies are still ordering merchant ships from China shipyards at full speed.
According to a recent report released by the Center for Strategic and International Studies (CSIS) in September, China’s shipyards accounted for up to 53 percent of global new ship orders in the first eight months of this year, compared to the year before the U.S. Trade Representative’s Office (USTR) launched the survey.
"Shipping companies are basically still doing business as usual," said Brian Hart, one of the report's authors."So far, these policies do not appear to have significantly caused shipping companies to shift orders away from China."
On October 10, China's Commerce Ministry responded that on April 17, the U.S. Trade Representative's Office announced the final measure of the 301 investigation into China's maritime, logistics and shipbuilding fields, in which the measures to impose port charges on China's related ships will be formally implemented on October 14. The U.S. measures are typical unilateral acts, have a clearly discriminatory color, seriously harm the interests of Chinese enterprises.
In order to safeguard domestic relevant industrial interests, the relevant departments of the Chinese side shall, in accordance with the relevant provisions of the International Maritime Transport Regulations of the People's Republic of China, charge special port charges for ships involving U.S. flags, U.S. made, U.S. companies owned, participated in or operated with U.S. elements.
China emphasizes that relevant countermeasures are aimed at maintaining a level playing field in the international shipping and shipbuilding markets and are "legitimate defense" actions. It is hoped that the United States will consider carefully, correct its wrong practices, move in the opposite direction with China, and find a solution to the problem through equal consultation and cooperation.
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