Bipartisan bill to strengthen shipbuilding industry in U.S. Congress...Can Korea-U.S. cooperation be an opportunity?

The U.S. Congress has bipartisanly proposed legislation to strengthen shipbuilding, which is critical to beating strategic competition with China.

The bill also calls for seeking alliances and cooperation, drawing attention to whether Korea, a shipbuilding powerhouse and U.S. ally, will have an opportunity if it is passed by the next parliament.

Senators Mark Kelly and Todd Young of the Senate and John Garamendi and Trend Kelly of the House proposed the Shipbuilding and Port Facilities Act for American Prosperity and Security on the 19th local time.

The legislation included a variety of policies to encourage shipbuilding in the United States, strengthen the shipbuilding base, and reduce dependence on Chinese ships.

The bill said there are currently only 80 U.S. ships used for international trade, but China has 5,500, suggesting the goal of increasing the number of U.S. ships by 250 within 10 years to operate a "strategic merchant fleet."

The strategic merchant fleet must consist of dry merchant ships in the United States, but if it is difficult to obtain a U.S.-made merchant ship, dry merchant ships can be used in foreign countries temporarily.

The bill allowed the U.S. government to work with treaty allies and strategic partners to bolster wartime maritime transport capabilities and explore opportunities to support the maritime industry on both sides.

The transportation and defense ministers have urged Congress to recommend ways to bolster the U.S. shipbuilding industry, while also requiring allies and partners to include ways to contribute or share best practices.

Currently, U.S. law requires U.S. ships used for trade to be repaired in foreign countries to pay 50% of the repair costs.

The proposed law raised the tax rate to 70% and required the payment of 200% for repairs in countries of concern such as China.

In the meantime, if a ship or shipowner who participated in a strategic merchant ship made the best effort to repair it in the United States, they were exempted from taxes even if it was repaired abroad.

If the bill is passed, it will open the way for American ships to be repaired in Korea.

The bill stipulated that within 15 years of entry into force, the United States must ship 10% of all products imported from China on U.S.-registered ships.

There is also a de facto tariff on products imported by Chinese ships or Chinese-owned ships.

The law will be automatically repealed when the 118th Congress ends this month, but it is expected to be reissued at the 119th Congress, which begins in January next year, as both Democrats and Republicans share the perception that shipbuilding should be strengthened.

Diplomats say that Congressman Mike Waltz, whom Trump has named as national security adviser, could also support the bill.

Walz stressed the importance of shipbuilding during a meeting with Senator Kelly at the Center for Strategic and International Studies on Sept. 25, saying he was working with Kelly on bipartisan legislation to revive shipbuilding.