Chinese vessels operating in the Bahamas and the Caribbean would face increased shipping costs

Photo: Wikimedia Commons.

According to a report from The Tribune, companies in the Bahamas have not yet expressed concern about the possible tariffs that could be imposed on each container shipment. These tariffs, due to new U.S. policies, would represent a significant economic increase of thousands of dollars.  

The main suppliers of construction materials and grocery stores pointed out that this new imposition of tariffs on Chinese vessels, which could reach up to $1 million per visit to U.S. ports, is comparable to what happened with the “artificial Covid” and inflationary pressures, as well as the supply chain disruption caused by the pandemic.  

Likewise, they mentioned that, after Tropical Shipping, one of the most important transport companies in the Bahamas, informed its Caribbean clients about the impact of this new policy promoted by the Office of the U.S. Trade Representative, strong opposition arose among U.S. exporters. This is because the measure would have “a far-reaching financial impact” across the Caribbean region, especially affecting those dependent on imports, as maritime freight tariffs would increase by thousands of dollars per TEU or per twenty-foot unit container. As a result, the maritime sector, particularly shipping companies, would be severely affected.  

In response, the review of U.S. national law stated that the Office of the U.S. Trade Representative has faced challenges and setbacks, which could lead to the abandonment of this new scheme. It is worth noting that the public hearing and feedback period ended on Monday, March 24.  

On the other hand, it is known that this process requires that, before April 17, 2025, the imposition of these new tariffs be finalized, which would come into effect at least 30 days later, meaning in mid-May. In this regard, Tropical Shipping expressed concern because most vessels operating in the Caribbean region are of Chinese nationality, meaning they would also be subject to these tariffs.  

In this context, Super Value President Debra Symonette stated that the supermarket chain, which has 13 stores, has not yet panicked. She also mentioned that consumers in the Bahamas have no reason to worry, as there is a possibility that these new tariffs will not be implemented. Additionally, she indicated that companies such as Super Value and others in the Bahamas could switch to a different nationality operator to mitigate the impact of potential additional costs.  

Furthermore, Symonette stated that they will try to absorb the financial burden for as long as possible to eventually pass it on in a way that does not affect Bahamians. This is because, after the cost-of-living crisis following the Covid-19 pandemic, the last thing citizens want is new inflationary pressures and price increases. Likewise, she noted that there is also the option to use other operators, not necessarily Tropical Shipping, so that customers do not panic and they can better manage this potential cost.  

Additionally, the review of U.S. national law indicated that, after an analysis conducted by the U.S. Trade Representative, it was suggested that this new tariff should not apply to Chinese-made vessels currently operating under U.S. companies such as Tropical Shipping. It was also mentioned that the tariff structure would be based on the number of vessels, using a sliding scale that would consider orders already placed by transporters with ties to China and the number of newly constructed vessels.  

Conversely, the same review of U.S. national law warned that there is currently an executive order project that only requires the signature of the U.S. president to take effect. This project proposes charging tariffs based on the tonnage entering U.S. ports through Chinese-manufactured vessels. However, few details are known about this project.  

Regarding this, Premier Importers CEO Chris Leida, a construction materials supplier, stated that it will be inevitable for companies like Tropical Shipping not to increase costs for their end customers, Bahamian importers, and their own customers. According to Leida, this would devastate the Caribbean region and slowing down the economy, affecting employment rates and harming businesses in this sector.  

However, the review of U.S. national law mentioned that tariffs might only apply to future vessels that companies have not yet planned or ordered from the People’s Republic of China. This would increase the likelihood that vessels already operating in the Caribbean and the Bahamas under non-Chinese companies might not have to pay these new tariffs.  

Last but not least, Tropical Shipping stated that they will continue to raise their voice on behalf of their customers and other companies affected by these new tariffs. Likewise, they commented that these tariffs will negatively impact shipping companies, exporters, and U.S. port operators. They also asserted that these tariffs will cause a $92.3 billion impact on the overall export business, making it difficult for U.S. exporters to compete with other shipping companies.

Main Source:

‘Not panicking yet’ over fears of huge shipping cost hike – The Tribune

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