In just two decades, China has emerged as the dominant force in global shipbuilding, capturing more than half of the world’s commercial shipbuilding market.

Meanwhile, the United States has seen its share dwindle to a mere 0.1%, posing significant economic and national security concerns, according to a report released Tuesday by the Center for Strategic and International Studies (CSIS).

The report underscores the extent of China’s shipbuilding dominance, highlighting that in 2024 alone, a single Chinese shipbuilder produced more commercial vessels by tonnage than the entire U.S. shipbuilding industry has constructed since the end of World War II.

Dennis Quaid’s #1 Warning for Americans

This comes as China already boasts the world’s largest naval fleet, solidifying its power in both commercial and military maritime capabilities.

“The erosion of U.S. and allied shipbuilding capabilities poses an urgent threat to military readiness, reduces economic opportunities, and contributes to China’s global power-projection ambitions,” the CSIS report stated.

Concerns over the state of U.S. shipbuilding have been growing in recent years as the country faces increasing competition from China, the world’s second-largest economy.

China’s ambitions to reshape the world order have led to heightened scrutiny of its shipbuilding industry, particularly its links to military expansion.

These concerns were amplified during a congressional hearing in December, where lawmakers and senior officials called for urgent action.

Former President Donald Trump recently addressed the issue, pledging to revive America’s shipbuilding industry. “We used to make so many ships,” Trump said.

“We don’t make them anymore very much, but we’re going to make them very fast, very soon. It will have a huge impact.” He further proposed establishing a new Office of Shipbuilding in the White House to oversee the industry’s revitalization.

In February, the leaders of four major labor unions called on Trump to strengthen American shipbuilding by implementing tariffs and other penalties against China’s growing control of the sector.

They argued that allowing China to dominate shipbuilding not only jeopardizes American jobs but also strengthens Beijing’s ability to exert influence over global shipping and trade.

“What we are seeing now is a recognition of the strategic significance of shipbuilding and port security, and the related challenges posed by China,” said Matthew Funaiole, a senior fellow in the China Power Project at CSIS and a co-author of the report.

He emphasized that concerns over shipbuilding are “a fairly bipartisan issue,” indicating broad political support for countermeasures against China’s maritime expansion.

The CSIS report details how China’s shipbuilding sector has undergone “a striking metamorphosis” over the past two decades, evolving from a minor player into the world’s leading producer of commercial vessels.

This transformation has been driven by China State Shipbuilding Corporation (CSSC), a state-owned enterprise at the heart of Beijing’s maritime ambitions.

As China expands its shipbuilding dominance, it has simultaneously built up its navy. A previous CSIS assessment found that China was operating 234 warships compared to the U.S. Navy’s 219, although the U.S. retains an advantage in guided missile cruisers and destroyers.

The report also examines the Chinese government’s “military-civil fusion” strategy, which blurs the lines between the country’s commercial and defense sectors.

It found that CSSC, which manufactures both commercial and military vessels, sells three-quarters of its commercial production to foreign buyers, including U.S. allies such as Denmark, France, Greece, Japan, and South Korea.

This means billions of dollars are being funneled into Chinese shipyards that also produce warships, effectively bolstering China’s military modernization.

To address this growing imbalance, CSIS researchers have proposed both short-term and long-term strategies. In the short term, they suggest implementing measures to “disrupt China’s murky dual-use ecosystem” by introducing docking fees on Chinese-made vessels and severing U.S. financial and business ties with CSSC and its subsidiaries.

In the long term, the report recommends that the U.S. make substantial investments to rebuild its shipbuilding industry and work with allies to expand shipbuilding capacities outside of China.

These efforts would be aimed at reestablishing the U.S. as a competitive player in the global maritime industry while limiting China’s influence over international shipping networks.

The Trump administration has already signaled its intention to take action by proposing new fees on China-linked vessels docking at U.S. ports.

Additionally, a BlackRock-led consortium recently agreed to acquire stakes in 43 ports worldwide, including two ports on either side of the Panama Canal, from a Hong Kong-based conglomerate. This move could help shift global shipping infrastructure away from Chinese control.

As the U.S. grapples with the implications of China’s shipbuilding supremacy, bipartisan support appears to be growing for measures to counter Beijing’s dominance.

While the challenges are significant, strategic investments in shipbuilding, coupled with diplomatic coordination with allies, could help restore the U.S. as a formidable force in the industry.

The question remains whether the political will and economic resources necessary to revitalize American shipbuilding can be mobilized in time to counter China’s continued expansion.

As policymakers deliberate the next steps, the stakes for national security and economic competitiveness could not be higher.