By: Staff Writer
March 21, 2025
Caribbean leaders are again in fear of a proposed US $1.5 million tax on Chinese ships entering into American ports as the obvious concern is the rising cost of goods as a result.
The U.S. plans to levy fees on imports arriving on Chinese-made ships and offer tax credits to resuscitate domestic shipbuilding and reduce China’s grip on the $150 billion global ocean shipping industry, a White House document seen by Reuters shows.
President Donald Trump is drafting an executive order that would also establish a Maritime Security Trust Fund as a dedicated funding source and create shipbuilding incentives through the use of tax credits, grants and loans, according to a draft fact sheet of the 18-point plan.
Caribbean leaders in government and industry are scrambling as a team from The Bahamas is set to meet with the US Congress some time next week to testify on how damaging this tax would be to smaller Caribbean nations.
Notes from a meeting attended by representatives of Caribbean shipping companies, some of the region’s largest retailers, and government officials, that was seen by Caribbean Magazine Plus, explains that the group is preparing a submission to the US Trade Representative (USTR), and to attend USTR hearings in Washington next week on Monday and Tuesday.
The group discussed the importance of understanding the context of the hearing on the president’s agenda against China, focusing on key issues and avoiding detrimental phrases, the notes say.
They emphasized the need to be strategic and clear about the hearing’s focus on China and not on tariffs for the Caribbean, and the importance of trade data and tourism statistics to support their case.
According to the notes, the advocacy group plans to engage with US chambers of commerce, national retailers associations, and suppliers, to advocate for Caribbean exemption from the USTR’s plan.
“American shipbuilding is critical to protecting our national and economic security. Now is the time to act — to address the impact of China’s policies and to replenish American maritime capacity and power,” former Biden national security advisor, Jake Sullivan said.
Republican and Democratic U.S. lawmakers for years have warned about China’s growing dominance on the seas and diminishing U.S. naval readiness. The pending executive order appears to be influenced by existing proposals, including legislation with bipartisan backing.
Trump’s initiative comes two months after the Biden administration concluded a nearly year-long probe requested by the United Steelworkers and other unions, which found that China uses unfair policies and practices to dominate the sector.
Notwithstanding the intensifying global standoff with the Trump administration and China and how it has nothing to do with the Caribbean and Central America at the core of it, the region will suffer the consequences of the fallout regardless.
The Caribbean imports nearly 90 percent of all it consumes, with over 80 percent of it from the US. If the US imposes taxes on cheap made Chinese products, the world’s largest exporting country, it would mean goods may increase double once they leave China and have to pass through the US on route to the Caribbean.
Many US manufacturers use Chinese made products in their supply chain. The results would be profound inflationary impacts.