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Rising US economic nationalism threatens to undermine world trade whoever wins November’s race to the White House, with shipowners particularly concerned about Donald Trump’s protectionism returning “on steroids”, the head of the global industry body has warned.
“The world order has never been under such threat since before the second world war,” Guy Platten, secretary-general of the International Chamber of Shipping, told the Financial Times. “When we last did this, it didn’t work . . . Trade wars lead to war.”
Platten was worried that Republican candidate Trump’s nationalist policies could return with a vengeance, adding that a “scary” visit to the White House during the former president’s first term in 2018 left him “taken aback”.
“There’s a danger, if that regime comes in again, we’re going to see that on steroids,” he added. “That just encourages everyone else to do the same thing . . . The whole natural order of international law and an agreed set of rules starts to come under threat.”
However, Platten, who heads a body that represents over 80 per cent of the world’s shipping fleet, also criticised moves by the Biden-Harris administration to target Chinese shipping. Kamala Harris, the current US vice-president, is the presumptive Democrat nominee.
Chinese shipowners “are really worried about the potential of tariffs to be placed on Chinese-built ships”, he said. “There’s always a price to be paid . . . which is not something politicians necessarily think through”.
Platten’s comments underline shipowners’ growing unease about the political direction in the US.
This week, Vincent Clerc, the boss of Danish shipowner AP Møller-Maersk, warned that customers were already bringing orders forward amid fears of an intensifying US-China trade war under Trump.
Data from Xeneta, a shipping specialist, showed a surge in China-Americas trade over the first five months of the year back to levels seen during the immediate aftermath of Covid-19. Analysts think that’s partly down to Trump’s threat to raise tariffs on all Chinese imports to 60 per cent.
“US businesses still have the chaos of Covid-19 fresh in their minds,” said Emily Stausbøll, senior shipping analyst at Xeneta. “If front-loading also helps to mitigate regional supply chain risks, such as potential strike action at ports on the US East and Gulf coasts, and new tariffs on Chinese goods, then you can understand why some US importers have taken this approach.”
The world’s largest economy, and biggest importer, has for decades championed free trade policies that underpinned globalisation and the growth of the shipping industry.
But leaders of both political parties are now pushing a protectionist agenda.
Trump has set out plans to supercharge trade restrictions with a 10 per cent levy on all US imports, as well as a 60 per cent tax on Chinese goods.
President Joe Biden has also raised tariffs on a range of Chinese goods, from electric cars to steel, in a pre-election bid to protect US jobs and shore up support in former industrial heartlands. In April, the White House announced an investigation into China’s “uniquely aggressive” actions that it said had led to “distortions” in the shipping market.
The move followed a petition by the United Steelworkers union that accused Beijing of using interventionist policies to dominate the shipbuilding industry and maritime trade globally.
The Biden-Harris administration had already broadened the powers of the US shipping regulator in 2022, when the president criticised the “foreign-owned carriers” that clashed with American importers during the supply chain disruptions of the Covid-19 pandemic.
But Platten claimed that a further clampdown on shipbuilding, which could include duties for Chinese-built ships calling at US ports, would be counterintuitive.
Highlighting predictions that such a measure would also drive up demand and prices for Japanese and Korean ships, he argued that “the US will end up paying more for the policy [than it gains] from any sort of tariffs. And that’s been proven throughout history: protectionist measures end up costing the country.”
