NASSAU, BAHAMAS- Nassau’s main commercial port operator is closely monitoring the proposed U.S. tariff on Chinese-built vessels, which could increase shipping costs by 50-60 percent for Caribbean businesses dependent on U.S. trade.
The Caribbean Shipowners Association (CSA), of which the Arawak Port Development Company (APD) is a member, is working with regional stakeholders to push for an exemption, using the Caribbean Basin Initiative (CBI) as a precedent.
Dion Bethel, President and CEO of APD, responded to Eyewitness News inquiries by noting that a collective lobbying effort is underway to advocate for a carve-out or exemption for the Caribbean due to its unique economic dependence on U.S. imports.
Tim Martin, President and CEO of Tropical Shipping, confirmed he will testify before Congress on March 24th to highlight the potentially devastating impact of the Trump administration’s proposed port fees on countries like The Bahamas. Super Value’s President, Rupert Roberts, has warned that the plan could cause inflation to rise by 25 percent, a situation that must be avoided at all costs. Shipping companies that bring cargo into the Bahamas and the Caribbean are expressing concern over the multimillion-dollar threat posed by the United States Trade Representative’s (USTR) proposal to impose a $1 million port fee per port call on any Chinese-built vessel arriving at U.S. ports.
The proposed U.S. tariff of up to $1.5 million per port call on Chinese-built vessels is expected to cause a 50-60 percent increase in shipping costs for Caribbean businesses that rely on U.S. trade. Many shipping lines serving the Caribbean operate Chinese-built vessels, meaning higher freight costs that will ultimately raise the price of imported goods. The Caribbean is highly dependent on trade with the U.S., so these measures could significantly disrupt supply chains. Reduced vessel calls and competition could further reduce market efficiency, increasing uncertainty for importers and exporters in the region.
The CSA has formally convened to strategize a response to mitigate the impact of the proposed tariffs. A collective lobbying effort is underway to advocate for an exemption for the Caribbean, due to its unique economic dependency on U.S. imports. The Caribbean Basin Initiative (CBI), which provides duty-free access to U.S. goods, is being referenced as a precedent to support an exemption for shipping costs. The key argument is that the tariff would hurt American businesses by making Caribbean trade more expensive, potentially shifting trade relationships to other global markets.
Caribbean stakeholders are taking several actions, including lobbying U.S. officials to engage with the USTR and policymakers to highlight the unintended consequences on Caribbean-U.S. trade. They aim to seek an exemption for Caribbean routes, arguing that the small scale of operations in the region makes the impact disproportionately high. Legal and trade policy advocacy will challenge the proposal by demonstrating its contradiction with existing U.S.-Caribbean trade agreements, and industry partners and business organizations will work together to strengthen the case against the tariff. Public and industry engagement will also be a key component, encouraging businesses and governments in the region to submit official comments to the USTR before the deadline, while mobilizing regional trade bodies to raise awareness of the long-term economic risks.
The USTR Section 301 timeline includes several key dates. On March 12, 2024, five U.S. labor unions petitioned the USTR to investigate China’s role in dominating shipbuilding and logistics. The USTR officially initiated the investigation on April 17, 2024, and invited public comments on the impact. On January 14, 2025, the USTR published findings stating that China’s dominance in shipping is an “unreasonable burden” on U.S. commerce. The deadline to request to speak at the USTR public hearing is March 10, 2025, with the public hearing scheduled for March 24, 2025. The final deadline for public comments is also March 24, 2025, and the deadline for rebuttal comments is April 1, 2025.
The CSA and Caribbean business leaders are actively pushing for an exemption, but the risk of higher costs remains real if the proposal is implemented. Given the March 24, 2025, deadline for public comments, regional businesses and importers are strongly encouraged to submit their concerns to the USTR to demonstrate the potential economic damage to Caribbean economies.
