Shipping Firms Pull Back From Hong Kong To Skirt U.S.-China Risks

Some shipping companies are quietly moving operations out of Hong Kong and removing vessels from its flag registry.

Last month, the U.S. Trade Representative’s office proposed steep U.S. port fees on Chinese shipping companies and others operating Chinese-built vessels. I Photo: COSCO Shipping

Others are making contingency plans to follow suit. Behind these low-profile moves, six shipping executives told Reuters, are concerns that their ships could be commandeered by Chinese authorities or hit with U.S. sanctions in the event of a conflict between Beijing and Washington, Greg Torode and Jonathan Saul reported for Reuters.

Beijing’s increasing emphasis on Hong Kong’s role in serving Chinese security interests, combined with growing U.S. scrutiny of China’s commercial fleet in a potential military clash—such as over Taiwan—has caused unease in the industry, sources told Reuters.

Last month, the U.S. Trade Representative’s office proposed steep U.S. port fees on Chinese shipping companies and others operating Chinese-built vessels, aiming to counter China’s “targeted dominance” of shipbuilding and maritime logistics.

In September, Washington warned American businesses about growing risks of operating in Hong Kong, where the U.S. already applies sanctions against officials involved in a security crackdown.

For more than a century, Hong Kong has been a global hub for shipowners, brokers, financiers, underwriters, and maritime lawyers.

Its maritime and port industry accounted for 4.2% of GDP in 2022, according to official data. The city’s flag is the eighth most-flown by ships worldwide, according to VesselsValue, a subsidiary of maritime data group Veson Nautical.