In a striking escalation of trade tensions, China on Tuesday announced sweeping sanctions on five U.S.-based subsidiaries of the South Korean shipbuilder Hanwha, while instituting retaliatory port fees on American-linked vessels.
The moves signal a sharpening maritime standoff ahead of anticipated high-level talks between Presidents Xi Jinping and Donald Trump.
China’s Ministry of Commerce declared that the sanctioned subsidiaries – Hanwha Shipping LLC, Hanwha Philly Shipyard Inc., Hanwha Ocean USA International LLC, Hanwha Shipping Holdings LLC and HS USA Holdings Corp had “assisted and supported” U.S. actions undermining China’s sovereignty in maritime, logistics, and shipbuilding sectors.
The decision bars Chinese entities and individuals from doing business with those units.
In concert with the sanctions, China’s transport authorities began collecting special port fees from U.S.-owned, operated, built, or flagged vessels docking in Chinese ports, save for ships built in China or visiting solely for repairs.
Fees will apply to the first port of entry or up to five voyages per year.
The twin measures hit global markets, with Hanwha Ocean’s stock sliding as much as 8 percent in Seoul, while shares of domestic Chinese shipbuilders rallied on expectations of competitive gains.
This tit-for-tat intensification comes amid parallel moves by the U.S. to revive its flagging shipbuilding sector and curb Chinese dominance in maritime trade.
Under Trump, the U.S. has imposed new port fees on Chinese vessels and ramped up export controls on semiconductors and advanced materials.
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Analysts warn that China’s targeting of a third-country firm like Hanwha underscores the expanding frontlines of U.S.–China competition, especially in strategic supply chains. Some in Seoul now face pressure to realign closer to Washington amid escalating pressure on Beijing.
Chinese officials also launched a formal probe into the impacts of the U.S. Section 301 maritime investigation on its shipping and shipbuilding sectors, leaving open the possibility of further countermeasures.
Whether diplomacy can contain the fallout remains uncertain. With both sides digging in, the maritime domain – long a quiet workhorse of global trade has now become a focal battleground of geopolitical brinksmanship.
Sources: Reuters. Yahoo Finance
