If US shores up defence against China shipbuilding threat, what could really happen?

Targeted action by Washington against Chinese shipbuilders in the waning days of Joe Biden’s presidency could offer a slight boost to South Korean rivals, but the impact may be very limited due to China’s overwhelming market dominance and strong backlog of orders, according to analysts and industry insiders.

The development, while not yet confirmed nor denied by the US, comes amid intensifying competition between the world’s two largest economies, as well as Washington’s efforts to rally more allies in a bid to decrease dependence on Chinese manufacturing and supply chains.

Asian yards, including those from South Korea and Japan, could benefit if the investigation results in penalties being imposed on China’s shipbuilders. Nevertheless, analysts and an executive from a major Chinese shipbuilding company said that the substantial scale of China’s shipbuilding industry and its cost advantages are too strong to significantly undermine.

James Chin, a professor of Asian studies at the University of Tasmania in Australia, said Chinese shipbuilders are safe in the near term – up to roughly 24 months – from any measures that the US might take.