WASHINGTON, D.C.: In the past 20 years, China has become the world's top shipbuilder, producing more than half of all commercial ships. Meanwhile, the U.S. shipbuilding industry has shrunk to just 0.1 percent of the market.

According to a report by the Center for Strategic and International Studies (CSIS), this decline is raising economic and national security concerns for the U.S. and its allies.

In 2024, a single Chinese shipbuilder produced more commercial ships—measured by weight—than the entire U.S. shipbuilding industry has since World War II. China also has the world's largest naval fleet, the report said.

"The decline of U.S. and allied shipbuilding is a serious risk to military strength, economic growth, and global security," the report warned.

Concerns over U.S. shipbuilding have grown as China, the world's second-largest economy, pushes to expand its influence. In December, U.S. lawmakers called for urgent action.

Last week, President Donald Trump told Congress he would rebuild the American shipbuilding industry for both commercial and military use. He announced plans to create a "shipbuilding office" in the White House.

"We used to make so many ships," Trump said. "We don't anymore, but we will soon—and fast."

In February, major labor unions urged Trump to strengthen U.S. shipbuilding and impose tariffs on China to counter its dominance.

Matthew Funaiole, a senior fellow at CSIS, said shipbuilding is now seen as a critical strategic issue with bipartisan support in the U.S.

The report explained that China's shipbuilding industry has rapidly grown in the past two decades, with the state-owned China State Shipbuilding Corporation (CSSC) leading the sector. At the same time, China has built up its navy. In 2023, China had 234 warships, compared to the U.S. Navy's 219. However, the U.S. still leads in guided missile cruisers and destroyers.

CSIS researchers found that CSSC, which makes both commercial and military ships, sells most of its commercial ships to foreign buyers, including U.S. allies like Denmark, France, Greece, Japan, and South Korea. This trade helps fund China's naval expansion and defense technology.

To compete, the report suggests the U.S. should invest in shipbuilding and work with allies to build more ships outside China. In the short term, it recommends steps like charging docking fees for Chinese-made ships and cutting U.S. financial ties with CSSC.

The Trump administration has proposed new fees for China-linked ships entering U.S. ports. Meanwhile, a BlackRock-led group recently bought stakes in 43 ports worldwide, including two at the Panama Canal, from a Hong Kong-based company.