Japan has proposed setting up a joint Japan-U.S. fund to help revitalize the U.S. shipbuilding industry during negotiations on lifting the tariffs imposed by President Donald Trump, according to sources.
The Japanese side has said the fund would not only create manufacturing jobs in the United States but would reduce the economic and security risks associated with China, the world’s largest shipbuilder, several Japanese government sources said.
Tokyo presented Washington with the “Japan-U.S. golden age of shipbuilding plan,” a set of proposals in the shipbuilding field, during the tariff talks, they said.
In addition to the fund, the plan includes support for maintenance of ship-repair docks in the United States and joint development of next-generation ammonia-fueled ships and icebreakers that do not emit carbon dioxide.
The United States was once known as a “shipbuilding superpower,” but its share of the global shipbuilding market has slumped to 0.1 percent in recent years, according to a U.S. think tank.
Trump, who has advocated a revival of the U.S. manufacturing industry, signed an executive order in April to revive and strengthen the U.S. shipbuilding industry.
The U.S. president is also believed to be interested in Japanese shipbuilding technology.
“Since the Japan-U.S. summit in February, we have been talking about cooperation between the two countries,” a senior Foreign Ministry official said.
Japan regards support for the U.S. shipbuilding industry as a “powerful card” in tariff negotiations.
A partnership with the United States could also help to bolster Japan’s shipbuilding industry, which was the world’s largest until the 1990s.
There is also a proposal within the Japanese government for a shipbuilding partnership between Japan, the United States and South Korea, the world’s second-largest shipbuilder.
If China, which holds more than 50 percent of the world market share in shipbuilding, were to reduce production due to an economic crisis or other emergency, there could be a global shortage of ships.
Japan and the United States would be able reduce such a potential risk to logistics by cooperating to increase their shipbuilding capacities, the sources said.
“The interests of the United States and Japan are aligned,” a Japanese government official said.
However, some officials of the Japanese shipbuilding industry have noted potential problems with such a partnership, including the time needed to establish a supply chain for parts and the high labor costs in the United States.
Prime Minister Shigeru Ishiba is also keen on Japan-U.S. cooperation in shipbuilding.
During a May 25 visit to a repair facility of Japan Marine United Corp., a shipbuilding giant, in Maizuru, Kyoto Prefecture, Ishiba told reporters that the United States is interested in repairing American warships in Japan.
“The Japanese government would like to support this, if possible,” Ishiba said.
(This article was written by Chinami Tajika, Takehiro Tomoda and Tatsuya Harada.)
AloJapan.com