Tuesday, January 26, 2021

US Executive Order Does Not Bode Well for Would be Foreign Maritime Carriers

American Citizens Will Still Build, Crew and Service Domestic Shipping Fleet
Shipping News Feature

US – Anyone who hoped that the removal of Donald Trump might open the country to a more amicable regime in terms of global trade will doubtless have been disappointed by one of the latest Executive Orders issued by President Joe Biden.

The President’s ‘Buy American’ Executive Order issued on Monday is intended to prioritise ‘American innovation, ingenuity and craftsmanship’ according to the vociferous support given by the Shipbuilders Council of America (SCA), with president Matthew Paxton saying:

[These traits] are pivotal to our national and economic security. Essential national and domestic security industries like the US shipyard sector, and the maritime defense industrial base, will grow stronger because of the actions taken today, ensuring the future of America is made in America.”

The real target of Executive Order 19 is to ensure American companies stay that way, it is designed to prevent moving jobs and companies offshore while still claiming preferential US status. The President’s Executive Order:

”Establishes the goals and standards necessary to use federal purchasing, and other forms of federal assistance with domestic preference requirements, as a way to proactively invest in American industry so it can continue to lead in the global marketplace.”

The Order increases both the threshold which mandates the percentage of a product which must be made in the US to qualify as ‘American Made’, and the price difference between that and a foreign item, before such a purchase is acceptable for the government to buy abroad.

So it seems it will be same old, same old as far as quid pro quo trade deals go. The US has always been considered protectionist by many and it will doubtless not only be the maritime sector that benefits from this attitude. The Jones Act typifies what opposition groups consider a drain on the nation’s resources by prohibiting free trade, a position stoutly dismissed by SCA Chairman Ben Bordelon, who commented:

“For over a century the Jones Act has been foundational to America’s economic success and national security. As a third generation shipbuilder I’m pleased that the Biden Administration is taking action to protect and ensure the continued success of the US maritime defence industrial base.”

The President has in fact signed a whole array of Executive Orders, over 30 in his first three days ranging from transgender candidates in the military to a variety of Covid related Orders. He has restored collective bargaining power and worker protections and raised the minimum wage for federal workers to $15 an hour, things which will doubtless win him many friends.

Biden has also opted to come back into the Paris Climate Change Agreement, something which could bode well for those groups getting ahead with the challenge of cutting maritime emissions using new technologies, dependant of course on how serious this President is to stick to the rules.