South Korea Asks for Tariff Relief and Support for Hanwha’s Philly Shipyard
Officials from South Korea and the U.S. state of Pennsylvania met in South Korea on Wednesday to discuss cooperation and how they could support the development of U.S. shipbuilding and specifically Hanwha’s Philly Shipyard. The meeting came as the government has finalized plans for for tis investment in the U.S., including the $150 billion Make American Shipbuilding Great Again (MASGA) initiative.
South Korea’s Ministry of Trade, Industry, and Resources led the meeting with Pennsylvania’s secretary of economic development, Rick Singer. According to the reports, they proposed a list of initiatives that could help support the plans to grow the shipyard and to create a shipbuilding cluster around the yard.
The White House plan released last month for revitalizing U.S. shipbuilding included a proposal for Maritime Prosperity Zones. South Korea is proposing that the Hanwha yard should anchor one of those zones. The plan calls for providing tax incentives and other benefits for shipbuilding-related industries in the zones.
Also at the federal level, South Korea is seeking possible tariff exemptions for shipbuilding materials. It mentions materials such as steel and components that could be exported from South Korea to build ships in the United States.
Speaking to the opportunity for bilateral cooperation in the shipbuilding sector, they proposed a series of steps that Pennsylvania could undertake to accelerate the planned expansion of Philly Shipyard. They called for a shortening of administrative procedures, such as permits for the expansion, proactively building infrastructure for transportation and the power needs of the yard, and supporting labor costs.
Park Dong-il, Director General for Industrial Policy, said South Korea looks forward to continuing the discussions. He highlighted the opportunities for collaborative and investment efforts while noting that Korea was working to finalize details of the MASGA program. He said Korean shipbuilders are reviewing various business projects that could include expansion of production capacity, talent education, and strengthening of supply chains.
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Hanwha has mapped an ambitious plan to expand operations at Philly Shipyard, which it acquired at the end of 2024. It has announced plans to complete an LNG carrier at the yard for its sister company, Hanwha Shipping. That was followed by the shipping arm announcing that it planned to build 10 MR tankers at the Philly yard to transport products under the U.S. flag and in the Jones Act trade.
The broader plan for the shipyard has called for increasing production in the mid-term to a capacity of 10 ships per year from the yard's current one and a half ships per year. The yard is currently finishing the last two MARAD training ships, recently conducted sea trials for the rock ship being built for Great Lakes Dredge and Dock Company, and has started work on three containerships for Matson.