US, China suspend mutual shipping probes in sign of easing tensions

BEIJING - The Trump administration has suspended a probe into China’s shipbuilding industry, prompting Beijing to reciprocate by shelving its own investigation and putting off special port fees for US vessels.

The Office of the US Trade Representative (USTR) said that the probe has been suspended for one year as of midnight on Nov 10 local time. Minutes later, China’s Ministry of Transport followed with an announcement that said its actions are being postponed at the same time to implement the consensus reached at recent trade talks with the US.

The US will continue to negotiate with China about the issues raised in the investigation, the USTR said in the statement.

The suspensions remove some costs and uncertainty for an industry that had been facing fees to deliver goods to the US. They make good on one of the agreements reached by presidents Donald Trump and Xi Jinping during talks in South Korea late in October. 

The imposition of port fees on each other’s vessels threatened to shake up global shipping, raise freight rates and snarl the flow of goods including key commodities like oil. China’s investigation was among retaliatory measures it announced in mid-October and aimed to assess the impact of the US probe into the nation’s maritime sector.

According to a fact sheet released last week, the US will pause tariffs on imports of ship-to-shore cranes and chassis from China, in addition to a suspension of fees levied on Chinese-built and operated merchant ships calling at American ports. 

The US concession was criticised by US industry and labour groups last week, who argued that it will undermine the push by Trump’s administration to build up a US shipbuilding sector. 

Mr Trump had been looking to counter China’s growing influence on the shipbuilding sector with the now-suspended probe as well as deals with Japan and South Korea to help the US revive a moribund domestic shipbuilding industry. BLOOMBERG