China Retaliates Against Hanwha Subsidiaries in Escalating Trade Dispute with US
Beijing has imposed sanctions on five US-based subsidiaries of South Korean shipbuilding giant Hanwha Ocean, escalating tensions in its ongoing trade dispute with the United States. The sanctions target Hanwha Philly Shipyard, Hanwha Ocean USA International, Hanwha Shipping holdings, and HS USA Holdings, effectively barring any Chinese entity from conducting business with them. The move follows accusations that these companies aided a US inquiry into China’s maritime industry.
The sanctions come after the US announced in april it would levy tariffs on ships built and operated in China. This action stemmed from a Section 301 investigation citing national security concerns and alleging unfair Chinese dominance in the shipbuilding sector. The US aims to curb China’s shipbuilding capacity and bolster its own domestic industry. Since the US tariffs were announced, Chinese shipbuilding has experienced setbacks, while South Korean shipbuilders have signaled support for the US position during trade negotiations.
China responded last week with retaliatory port taxes on US vessels entering Chinese ports, mirroring the timing of the US tariff implementation. Both sets of measures took effect today. china’s Ministry of Commerce condemned the US investigation and tariffs as damaging to Chinese businesses, specifically accusing Hanwha’s subsidiaries of “jeopardizing China’s sovereignty, security and progress interests” through their cooperation with the US investigation.
The Chinese Ministry of Transport has also initiated an assessment of the impact of the Section 301 investigation on its own shipping sector, indicating potential for further retaliatory actions. This dispute carries significant global economic implications, given that maritime shipping handles approximately 80% of worldwide trade. News of the sanctions caused Hanwha Ocean shares to fall as much as 8% on the Seoul Stock Exchange, reflecting investor concerns about the impact on the company’s operations.
