Chinese sanctions on Hanwha's US shipbuilding units aim to 'coerce' South Korea, State Dept says

SEOUL — Chinese sanctions imposed this week on US affiliates of shipbuilder Hanwha Ocean aim to undermine South Korea-US co-operation and "to coerce" Washington's Asian ally, a US State Department spokesperson said on Friday (Oct 17).

China announced the sanctions on Tuesday as the US and China began charging additional port fees on each other's vessels in the latest exchange in a protracted trade war ahead of a planned meeting of the two countries' leaders.

China's Commerce Ministry banned transactions and co-operation with Hanwha Ocean's US-linked affiliates, citing security risks stemming from what it said was their involvement in the US government's "relevant investigative activities."

"China's targeting of Hanwha is an irresponsible attempt to interfere with a private company's operations and undermine US-ROK (Republic of Korea) co-operation on revitalising American shipbuilding and manufacturing," a State Department spokesperson said.

"China's actions... are the latest example in a long pattern of China's attempts to coerce (South) Korea," the spokesperson said in a statement relayed to Reuters.

The five companies under new Chinese sanctions include Philly Shipyard in the US, owned by Hanwha, which is one of the world's largest shipbuilders and has won contracts to repair and overhaul US Navy ships.

Its entities will also build a US-flagged LNG carrier.

South Korea has pledged to inject as much as US$150 billion (S$193 billion) to help the US revive its troubled shipbuilding industry as part of its trade negotiations with Washington aimed at lowering US import duties against South Korean goods.

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