Seagoing trade is one of the cornerstones of our modern, globalized economy. More than 70 percent of the world’s trade by value is shipped by ocean, according to the Center for Strategic and International Studies, and the volume of goods traded has grown from 6 billion tons in 2000 to nearly 13 billion tons today, according to UN Trade and Development (UNCTAD). Forty percent of U.S. trade, representing 18 percent of U.S. GDP, was moved by ocean in 2021 according to the Bureau of Transportation Statistics. To import and export goods beyond North America, the United States must have access to a reliable supply of oceangoing cargo vessels.
However, the United States today has almost zero global presence in the critical shipbuilding industry – having lost its manufacturing lead to Asia – and particularly China. A Center for Strategic and International Studies report estimates the United States controls barely one-tenth of one percent of global shipbuilding capacity.
The lack of domestic shipbuilding capacity has significant security implications. China’s 175 major shipyards give it the capacity to expand its naval fleet — already the world’s largest with 370 hulls — to 435 ships by 2030, according to the Department of Defense’s annual report to Congress. The United States, operating just seven comparable shipyards, aspires to increase its fleet from 297 to 381 ships in the coming decades — but a January Congressional Budget Office report on the proposed expansion cites shipyard capacity as a factor with the potential to limit the rate of this buildout.
To overcome these challenges, President Trump issued an Executive Order on “Restoring America’s Maritime Dominance,” directing federal agencies to produce a Maritime Action Plan to bolster the maritime industrial base through federal investment and incentives for shipyards, expanded workforce training programs, and engagement with allies Japan and South Korea with strong shipbuilding supply chains.
