As Trump turns to South Korea and Japan, China strengthens maritime ties with Saudi Arabia

August 27, 2025, by Naida Hakirevic Prevljak

China and Saudi Arabia intend to strengthen their collaboration in the maritime sector, especially in shipbuilding, where China holds a leading position globally.

Saudi Arabia, guided by its Vision 2030, is committed to enhancing its domestic shipbuilding capabilities.

The two sides are said to have ‘strong’ industrial complementarity and broad prospects for cooperation. They hope to establish a long-term communication and cooperation mechanism to better promote complementary strengths and resource sharing, further strengthen in-depth cooperation in areas such as shipbuilding equipment, talent development, technological innovation, and digital transformation. The cooperation with China would help Saudi Arabia build a local industrial chain and supply chain system, creating a new era of win-win development.

The talks were held in Shanghai on August 25, 2025, when Wang Guoqiang, Director and General Manager of China State Shipbuilding Corporation (CSSC), met with visiting Saudi Minister of Investment Khalid al-Falih on the occasion of the Saudi-China Shipbuilding Supply Chain Roundtable.

Saudi Arabia is a key partner in China’s Belt and Road Initiative and has a significant demand for shipping and offshore energy equipment. Both sides are key promoters of the sustainable development of the global maritime industry, and have already carried out practical cooperation in areas such as offshore equipment construction and shipyard construction.

Going forward, the two sides will further strengthen in-depth cooperation in areas such as green shipbuilding and repair, shipyard construction, shipbuilding supply chain, cruise industry, seawater desalination, and clean energy, aiming to achieve mutually beneficial outcomes.

In other news, the global shipbuilding sector has witnessed momentous developments, driven by the U.S. President’s long-term ambitions to revive the American shipbuilding industry. The government leveraged diplomatic negotiations and looming tariffs to secure agreements with South Korea and Japan—the two biggest shipbuilding nations next to China.

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After a round of negotiations, the US government sealed a trade deal with South Korea in late July, lowering proposed tariffs in exchange for a staggering $350 billion investment commitment, of which $150 billion is earmarked specifically for U.S. shipbuilding.

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This was immediately preceded by an agreement with Japan, which saw Tokyo pledge a $550 billion package to modernize and build U.S. shipyards, a direct result of tariffs being cut from 25% to 15%.

Greek shipbroker Intermodal has warned that the revival of the US shipbuilding industry has challenges as well. A labor shortage in U.S. shipyards remains a recognized barrier to any rapid expansion, requiring sustained efforts in workforce development. Furthermore, a significant cost differential, where building a ship in the U.S. can be considerably more expensive than in South Korea or China, poses a major hurdle for long-term cost-competitiveness without continued policy support.

It remains to be seen if the North American presence in global shipbuilding will have any impact on China’s dominance in the market.