Port fees and tariff sprees: Sailing into Sino-US stormy seas

On Oct. 14, 2025, a new front opened in the long-running trade dispute between the U.S. and China. The U.S. began imposing additional port service fees on vessels connected to Chinese entities, following an April announcement by the U.S. Trade Representative under its Section 301 investigation into Beijing’s practices in maritime, logistics and shipbuilding.

These fees, which start at $50 per net ton and rise to $140 by 2028, target ships owned, operated or built by Chinese companies, reflecting Washington’s push to revitalize its own shipbuilding industry amid accusations of unfair state subsidies from China.

In swift retaliation, China introduced matching special port fees on U.S.-linked vessels, beginning at roughly $56 per net ton and increasing to $157 by 2028. The measures apply to ships owned or operated by American firms, those flying the U.S. flag, or even vessels where U.S. entities hold at least 25 percent equity.

This exchange barely had time to settle before President Trump escalated matters further. On Oct. 11, he announced an additional 100 percent tariff on all Chinese imports, set to take effect Nov. 1, 2025, on top of existing duties. The move came amid a stock market sell-off and followed China’s restrictions on rare earth mineral exports, which Trump cited as justification.

Beijing responded with defiance, signaling potential countermeasures while emphasizing its commitment to open trade. This latest salvo builds on a pattern established since 2018, when initial tariffs targeted goods, but now extends to shipping infrastructure and broad import barriers, threatening the foundations of global commerce.

China’s approach to these provocations has been consistent: measured reciprocity against what it views as American unilateralism. Beijing argues that the U.S. port fees violate international trade norms and the bilateral maritime transport agreement, disrupting mutual exchanges. Its countermeasures, authorized by the State Council and aligned with domestic laws like the Regulations on International Maritime Transport, mirror the U.S. actions in scope and scale, capping fees at five voyages per ship annually to prevent complete severance.

This mirrors past responses, such as tariffs on U.S. agricultural products in 2018 or investigations into American tech companies amid chip restrictions. Even with the impending 100 percent tariffs, Chinese officials have framed their stance as defensive, pledging proportional steps to protect national interests without initiating aggression. Such restraint aims to preserve economic stability, allowing China to sustain growth rates above 4 percent despite external pressures.

The real question, however, is the toll on Sino-U.S. trade and the global economy. The port fees alone could add millions to shipping costs — a large container ship might incur over $1 million per U.S. port call, leading operators to reroute or abandon Chinese-built vessels.

U.S. exporters of commodities like soybeans and energy face higher fees at Chinese ports, eroding their edge in a market where China buys nearly $150 billion annually from America. Chinese goods bound for the U.S., from electronics to textiles, will see freight rates spike, with costs likely passed to consumers or absorbed by slim margins.

The Nov. 1 tariffs amplify this strain exponentially. A 100 percent duty on Chinese imports —  potentially affecting $500 billion in annual goods — could double prices for everything from consumer electronics to apparel, hitting U.S. households during the holiday season. Retailers are scrambling, with groups like the National Retail Federation warning of shortages and inflation surges. Goldman Sachs estimates that American consumers would bear 55 percent of the costs, exacerbating inequality as low-income families feel the pinch most acutely. On the Chinese side, exporters could lose market share, prompting factory closures and job losses in coastal provinces, though Beijing’s subsidies might cushion some blows.

Objectively, these actions hasten the decoupling of the world’s two largest economies, a process underway since tech bans and supply-chain relocations began in 2019. U.S. firms have shifted 20-30 percent of production from China to alternatives like Vietnam and India, reducing vulnerability but increasing costs by 10-15 percent.

The port fees will accelerate this, encouraging shipbuilders to turn to South Korea or Japan, while the tariffs could slash Chinese exports to the U.S. by another 20 percent, according to IMF projections. Ports in both countries may see traffic drop: Los Angeles and Long Beach could handle 5 percent to 10 percent fewer calls, while Shanghai redirects to Belt and Road partners in Europe and Africa.

This fragmentation creates inefficiencies, raising global trade costs by trillions over the decade. Smaller economies suffer collateral damage — Southeast Asian nations gain some manufacturing but face volatile shipping routes, while African countries deal with pricier imports. For the U.S., the tariffs might boost domestic production in sectors like steel and autos, adding perhaps 100,000 jobs, but at the expense of broader growth slowdowns estimated at up to 1 percent of GDP. China, with its vast internal market and diversifying exports, may weather the storm better, projecting 4.5 percent growth in 2026, but it risks overcapacity and strained relations with allies.

Yet decoupling is incomplete. Deep interlinks persist, with U.S. companies still reliant on Chinese components for half their supply chains. The irony is that both sides seek self-sufficiency, but mutual infliction of pain weakens that goal. As one analyst put it, these measures erode prosperity rather than protect it. Recent signals of a Trump-Xi Jinping meeting suggest room for de-escalation, perhaps through phased rollbacks or WTO mediation. Without it, the conflict risks permanence, diminishing global influence for both powers. In an interdependent world, cooperation under shared rules offers the surest path to security — not endless escalation.

Imran Khalid is a physician and has a master’s degree in international relations.