Almost a year after US President Donald Trump called for a revitalization of American shipbuilding, the White House released this month a detailed Maritime Action Plan that focuses on reversing decades of decline in U.S. shipbuilding and restoring the nation’s maritime industrial capacity to meet national security and economic objectives.
The release of “America’s Maritime Action Plan” calls for a land port maintenance tax to balance payments from importations across land ports versus maritime ports, a universal fee on foreign-built vessels from any nation entering U.S. ports, a Maritime Security Trust Fund, and the establishment of Maritime Prosperity Zones to incentivize and facilitate domestic and allied investment in U.S. maritime industries and waterfront communities.
The policy recommends a universal infrastructure or security fee on all foreign-built commercial vessels calling at U.S. ports, to be assessed on the weight of the imported tonnage arriving on the vessel. The plan estimates a fee of 1 cent per kilogram on foreign-built ships would yield roughly $66bln in revenue over ten years and a fee of 25 cents per kilogram would yield close to $1.5trn in revenue, which could be used for the Maritime Security Trust Fund. The Maritime Security Trust Fund (MSTF) would provide a dedicated, mandatory funding stream to support programs that strengthen the U.S. maritime industry and merchant marine.
One of the key elements of the MAP is the establishment of the Land Port Maintenance Tax (Fee). Merchandise entering the United States through land ports of entry would be subject to a modest tax (0.125 percent of the value of the merchandise), ensuring that land ports contribute equitably to the costs of maintaining and improving critical trade infrastructure.
The plan also calls for an increase in the fleet of commercial vessels trading internationally under the U.S. flag, for actions -as appropriate- based on USTR’s investigation of the People’s Republic of China’s (PRC) targeting of the maritime, logistics, and shipbuilding sectors for dominance, for the development of a strategy to secure Arctic waterways, and for a Maritime Incentives Coalition.
The Maritime Action Plan offers a road map for the revival of U.S. shipbuilding, which severely lags China and other nations.
In accordance with the plan, actions should be taken to promote the use of U.S.-built, flagged, and crewed ships that participate in international trade.
As ships are being built in the United States, the plan recommends an increasing percentage (up from 50 percent) of civilian U.S. Government agency cargoes to move on U.S.-flagged vessels to strengthen the economic foundation of the fleet, helping to ensure sufficient tonnage and crew availability for mobilization in a crisis.
Recommended actions also include transforming shipbuilding, repair, and port infrastructure through investments in drydocks, heavy‑lift and gantry cranes, panel lines, and automated material handling systems. It also calls for the establishment of a Strategic Commercial Fleet (SCF). “Vessels in the SCF would receive financial support for both construction and operation, leveling the playing field between the U.S. and subsidized foreign competition.”
The plan suggests long-term funding and modernization of federal ship financing program, increase in funding and incentives, expanding shipyard capital improvement financing, establishing a new grant program to fund projects that increase the capacity and efficiency of U.S. shipyards of all sizes, and to increase funding levels for existing Maritime Administration (MARAD) programs that support investment in shipyards.
It recommends the expansion and modernization of the Federal financing and tax incentives (i.e., Title XI, CCF, CRF, accelerated depreciation, tax credits) to lower the after-tax cost of vessel construction and shipyard investments, and to create dedicated credit or loan programs for major shipyard capital projects.
The MAP also recommends: Improving the acquisition processes for USG vessels while reducing change orders, fostering the development of autonomous maritime technology industry, and prioritizing the recapitalization of government owned sealift vessels.
To increase the maritime workforce, planners are calling for expanded mariner training and education to address workforce challenges in the maritime sector through maritime educational institutions and workforce transitions, and for financial and regulatory incentives for the training of shipbuilders and U.S. credentialed mariners.
With only 66 total shipyards consisting of eight active shipbuilding yards, 11 shipyards with build positions, 22 repairs yards with drydocking, and 25 topside repairs yards – the United States does not have the capacity necessary to scale up the domestic shipbuilding industry to the rate required to meet national priorities.
Strategic competitors, meanwhile, dominate the market and build ships at a fraction of the cost of U.S. production.
Recent data shows that the United States constructs less than one percent of commercial ships globally.
The U.S. commercial shipbuilding industry supporting the construction of large ocean-going ships is limited.
“There are only eight U.S. shipyards that can build vessels greater than 400 feet in length. The repair base for vessels greater than 400 feet in length includes 22 shipyards with drydocking capability and 25 additional shipyards with topside repair capability,” the White House mentions in the recently published plan.
