WASHINGTON — The White House has reaffirmed a "priority" legislative proposal that would authorize the U.S. Navy to contract the construction of two surface combatant ships and two non-combat auxiliary vessels at foreign shipyards, according to a recent document transmitted to Congress.

The Office of Management and Budget (OMB) outlined the proposal in a policy statement sent to the House of Representatives on July 21, detailing the administration's position on the House version of the fiscal year 2027 National Defense Authorization Act (NDAA), the annual must-pass legislation that sets policy and spending authorizations for the U.S. military.

The OMB explicitly opposed a provision in the House bill that would bar the use of defense funds for procuring "battle force" ships built at foreign shipyards.

"The prohibition ... is inconsistent with the administration's priority legislative proposal, which would authorize the Navy to contract to construct two surface combatant vessels and two non-combat auxiliary vessels in foreign shipyards for the purpose of driving significant and direct foreign investment into our domestic shipyards," the statement said.

The OMB further argued that the restriction does nothing to resolve mounting shipbuilding "backlogs" currently facing the United States. Those backlogs have persisted even as the Navy seeks to expand its fleet to address mounting strategic competition, particularly with China, whose shipbuilding capacity now far exceeds that of the United States.

The push to utilize foreign shipyards comes as South Korea and the United States deepen cooperation aimed at revitalizing America's shipbuilding sector, which has seen its share of global commercial ship production fall to a fraction of output from Asian competitors. Concerns persist, however, that U.S. regulatory barriers — including laws restricting foreign ownership and operation of domestic shipyards — could impede such collaboration between the two allies.

Seoul has committed to investing $150 billion in shipbuilding cooperation with the United States, forming part of a broader $350 billion investment pledge made under last year's bilateral trade and investment agreement with Washington.

In its policy statement, the OMB referenced the so-called "Finland Model" — a framework under which the United States would first procure vessels more quickly from allied foreign shipyards before eventually shifting production to domestic facilities buoyed by foreign investment.

The office also warned that the House bill's restrictions on purchasing ships from foreign shipyards "limit the flexibility of the U.S. in leveraging foreign shipyards that have specific advancements, strengths and technology that serve a specific Department of War need."

"Access to these areas will expedite the growth of the U.S. shipbuilding industrial base and assist directly in meeting exigent national security objectives," the statement continued.

The Senate has yet to finalize its own version of the NDAA, and the foreign-shipyard question will be among the provisions requiring reconciliation when lawmakers from both chambers meet to produce a compromise bill later in the legislative cycle.

Last month, U.S. President Donald Trump indicated that his administration may explore partnerships with Korean and other international companies for shipbuilding cooperation as part of broader efforts to strengthen the U.S. Navy.

Source: The Korea Times