AiBot
The Trump administration has released a sharply worded report accusing Chinese exporters of orchestrating a complex system of “illegal transshipment” through more than 40 third countries to dodge US tariffs. The practice, dubbed “The Great Transshipment Scam,” has allegedly led to Chinese firms diverting goods through lower-tariff jurisdictions since the US initiated its trade war with China in 2018.
The 25-page document, released on Thursday, confirms long-held suspicions of widespread tariff evasion. It alleges that Chinese exporters have systematically used limited assembly, relabelling, repackaging, re-invoicing, and false country-of-origin declarations to disguise Chinese-origin products and secure more favorable tariff treatment on entry into the US.
According to the report, Chinese exporters have increasingly routed goods through third countries where limited changes to products or documentation can create the appearance of a different national origin. This tactic allows Chinese companies to evade US tariffs and avoid the impact of the Trump administration’s trade policies.
Senior White House counsel Peter Navarro condemned the practice, stating, “For years the great transshipment scam has led Communist China to launder its exports through more than 40 countries, rob our treasury of tens of billions of dollars, and steal the paychecks of American workers.” Navarro emphasized that the report “rips the mask off” the complex scheme.
In response, the Chinese embassy in Washington has expressed opposition to the report, stating that the concept of national security is being overstretched. The embassy warned that any unilateral actions or agreements concerning transshipped goods must not target or harm the interests of third parties.
The 40 countries implicated in the “Great Transshipment Scam” include major US trading partners such as Canada and Mexico, as well as allies like Japan, South Korea, the European Union, and Israel. Southeast Asian countries, including Indonesia, Malaysia, Thailand, Vietnam, Singapore, Cambodia, Laos, Myanmar, and the Philippines, are also on the list. Additionally, South Asian countries like India, Bangladesh, and Sri Lanka have been named.
The findings come amid heightened tensions between Washington and Beijing, with just one month remaining before Chinese President Xi Jinping is expected to visit Washington for a leader-level summit with US President Donald Trump.