Reuters reported that after China’s Ministry of Commerce announced countermeasures against five U.S.-related subsidiaries of Hanwha Ocean, Hanwha Ocean’s stock price fell 5.8% at the close on October 14, and Hyundai Heavy Industries’ stock price also fell 4.1%.
On the 14th, Hanwha Ocean’s stock price plummeted.
According to Yonhap News Agency, on the 14th, the South Korean Presidential Office stated that the South Korean government is communicating with China, hoping to minimize the losses that Korean companies will suffer.
The South Korean Presidential Office stated that in the future, it is necessary to comprehensively consider whether China’s measures will affect the “MASGA” project (an abbreviation for Make American Shipbuilding Great Again). Considering that the sanctioned Korean companies have little trade with Chinese companies, the impact of China’s measures on the relevant companies is expected to be “limited.” It is difficult to say whether China will impose further sanctions, and the South Korean government will maintain close attention to related developments.
The South Korean Ministry of Foreign Affairs stated in a declaration that it is currently assessing the impact of the sanctions and is communicating with relevant departments and industries in China and South Korea to minimize the impact of the sanctions.
According to a Reuters report, a company document from Hanwha Ocean shows that the company has a shipyard in Shandong Province, China, which mainly produces ship component modules. According to Hanwha Ocean, these modules are shipped to shipyards in South Korea for final assembly.
Hanwha Ocean told Reuters that it is closely monitoring the potential impact of this matter on its business. The company will continue to provide services to its customers, including through its investment in the U.S. maritime industry and related projects at the Hanwha Philly Shipyard.
In August of this year, Hanwha Ocean announced an additional $5 billion investment in Philly Shipyard. Hanwha Ocean acquired Philly Shipyard for $100 million in 2024.
The United States has long been struggling with the decline of its shipbuilding industry. Currently, the U.S. accounts for less than 1% of global commercial shipbuilding, far lower than China’s approximately 60%, with South Korea ranking second at 22%.
South Korea has pledged to inject up to $150 billion to help the U.S. revitalize its domestic industry.
Reuters reported in September that Hanwha Ocean’s competitor, Hyundai Heavy Industries, the world’s largest shipbuilder, is also in talks with relevant companies to acquire a U.S. shipyard.
U.S. President Trump previously stated that the United States needs help from allies like Japan and South Korea to revitalize its struggling shipbuilding industry. Currently, the U.S. shipbuilding industry lags behind China, with a particularly significant gap in the construction of naval vessels.
This year, the Trump administration also announced plans to impose fees on ships related to China, aiming to weaken China’s influence in the global maritime industry while boosting the U.S. shipbuilding industry.
On October 14, U.S. Eastern Time, the United States, based on the so-called 301 investigation results, officially imposed port fee restrictions and other measures on China’s maritime, logistics, and shipbuilding sectors. China’s Ministry of Commerce expressed strong dissatisfaction and firm opposition on the 14th and had already announced on October 10 that it would levy special port dues on ships involving U.S. elements such as U.S. flag, U.S. build, U.S. ownership, shareholding, or operation.
On the same day, China further escalated its response, announcing countermeasures against five U.S.-related subsidiaries of Hanwha Ocean Co., Ltd., prohibiting organizations and individuals within China from engaging in relevant transactions, cooperation, and other activities with them.
China emphasized that the U.S. action seriously violates international law and the basic norms of international relations and severely damages the legitimate rights and interests of Chinese enterprises.
China believes that the relevant U.S. subsidiaries of Hanwha Ocean Co., Ltd. assisted and supported the U.S. government in conducting the 301 investigation and taking measures against China’s maritime, logistics, and shipbuilding industries. China expresses strong dissatisfaction and firm opposition to this. To safeguard its own sovereignty, security, and development interests, and in accordance with relevant laws and regulations such as the “Anti-Foreign Sanctions Law of the People’s Republic of China,” and approved by the national counter-foreign-sanctions coordination mechanism, China has decided to include five U.S.-related subsidiaries of Hanwha Ocean Co., Ltd. in the countermeasures list, prohibiting organizations and individuals within China from engaging in relevant transactions, cooperation, and other activities with them.
China urges the United States and relevant companies to respect the facts and multilateral economic and trade rules, abide by the principles of the market economy and fair competition, correct their wrong practices as soon as possible, and stop harming China’s interests.
At the Foreign Ministry’s regular press conference on the 15th, a foreign media reporter asked: South Korea stated it is negotiating with China to minimize the impact of China’s measures against South Korean shipbuilders, ocean companies, and subsidiaries linked to the United States. What is China’s response? Furthermore, South Korean media reported that the South Korean side stated such sanctions might be related to tensions between China and the United States. What is China’s comment on this?
Foreign Ministry Spokesperson Lin Jian responded: Yesterday, China’s competent authorities have already responded to the relevant questions, which you can refer to. We once again urge the U.S. side and relevant companies to respect the facts and multilateral economic and trade rules, abide by the principles of the market economy and fair competition, correct their wrong practices as soon as possible, and stop harming China’s interests.
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