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China recently imposed sanctions on U.S. affiliates of South Korean shipbuilder Hanwha Ocean, aiming to influence South Korea's cooperation with Washington. The sanctions prohibit business transactions and partnerships with five U.S.-linked Hanwha entities, including Philly Shipyard, which repairs U.S. Navy ships and builds U.S.-flagged LNG carriers. The U.S. State Department described China's move as an attempt to interfere with private companies and disrupt U.S.-South Korea collaboration in shipbuilding and manufacturing. South Korea has committed up to USD 150 billion to support U.S. shipbuilding as part of trade negotiations to reduce import duties on South Korean goods.
China recently announced sanctions on U.S. affiliates of Hanwha Ocean, a major South Korean shipbuilding company, in what the U.S. State Department described as a move to pressure South Korea. The measures prohibit Chinese entities from conducting transactions or cooperating with five U.S.-linked Hanwha companies, including Philly Shipyard, a U.S.-based firm that repairs and overhauls U.S. Navy ships and is also involved in building a U.S.-flagged LNG carrier. Advertisement
A State Department spokesperson said that China's targeting of Hanwha is an irresponsible attempt to interfere with private company operations and to undermine cooperation between the U.S. and South Korea in revitalizing American shipbuilding and manufacturing. The spokesperson added that this action fits a long-standing pattern of China trying to coerce South Korea in regional and economic matters.
The sanctions come amid rising trade tensions between China and the U.S., with both countries beginning to charge additional port fees on each other's vessels. This move comes just before a planned meeting between the leaders of the two nations, highlighting how geopolitical considerations are influencing business operations.
Hanwha Ocean is one of the world's largest shipbuilders and has secured key contracts that include repairing and maintaining U.S. Navy vessels. Its U.S. affiliates also contribute to the construction of specialized ships such as LNG carriers, which are important for energy transport. These contracts place Hanwha at the center of both defense and commercial maritime industries, making it a focal point in U.S.-South Korea industrial cooperation.
As part of broader trade agreements with Washington, South Korea has pledged up to USD 150 billion to assist the U.S. in reviving its shipbuilding industry. These investments aim to strengthen industrial ties and reduce import duties on South Korean goods, showing Seoul's commitment to economic collaboration while navigating pressures from China.
Source Reuters
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