South Korea to commence full-scale shipbuilding collaboration with the US
South Korea intends to promote co-operation with the US in the shipbuilding industry in earnest in the second half of the year, with the aim to achieve growth that benefits the entire industry
The government has admitted that the US wants South Korea to join forces with them to counter China in shipbuilding
THE South Korean government has announced that its shipbuilding collaboration with the US is set to begin in earnest in the second half of this year.
The Ministry of Trade, Industry and Energy held a meeting with shipbuilders and equipment manufacturers on July 14 and emphasised the importance of “real growth”, in which the entire South Korean shipbuilding ecosystem, ranging from large shipbuilders to small shipyards and equipment manufacturers, grows together.
Park Dong-il, the ministry’s director general for manufacturing industry said: “In the second half of the year, we will promote important policies, such as earnest promotion of Korea-US shipbuilding co-operation, preparation of measures for shipbuilding-related materials, parts and equipment, and a strategy for a new growth driver to succeed LNG carriers.”
Industry participants expressed their expectation that bilateral co-operation, including the maintenance, repair and overhaul of US naval ships, as well as supply chain co-operation, would progress rapidly to the benefit of the entire industry, including equipment manufacturers.
Meanwhile, the potential shipbuilding partnership between the two countries will proceed on the basis that South Korea joins forces with the US to counter China in the shipbuilding sector.
At an industry-National Assembly debate on South Korea’s national interests amid tariff wars held last week, Chang Sung-gil, director general for trade policy of the ministry, said: “Shipbuilding is a prime example of an area where we are being asked to co-operate with the US as a check on China.
“The US has a sense of crisis over China’s shipbuilding industry and views us as a strategic defence partner in this regard. During the shipbuilding collaboration, the US may ask us to work together to counter China, for example by refraining from using Chinese materials in shipbuilding.
“It’s a shipbuilding co-operation with that [participation in countering China] attached to it, it’s not a separate concept of shipbuilding co-operation. So, we’re trying to figure out how to co-operate on shipbuilding within the overall picture and how to circumvent or exempt the Jones Act.”
With US president Donald Trump setting a deadline for next month to impose reciprocal tariffs, South Korea is pushing for a deal that would see tariffs eased in exchange for its contribution to rebuilding US manufacturing in competitive industries, such as shipbuilding and the semiconductor industry. This strategy is known as the ‘ships and chips’ approach.