The White House released a report accusing more than 40 countries of assisting China in evading American tariffs through transshipment, a practice where goods are routed through third nations with lower import duties before reaching their final destination. Nations identified in the report include Canada, India, Mexico, Japan, and South Korea. According to government and private sector estimates cited by the administration, the scheme has involved moving between $30 billion and roughly $300 billion in goods through alternative channels.
White House trade adviser Peter Navarro stated the evasion tactics had resulted in lost American jobs and billions of dollars in government revenue. The administration characterized the process as a sophisticated operation, describing it as “fraud cloaked in paperwork.” The White House report detailed how China has allegedly repackaged goods and obscured their origins to obtain lower tariffs, calling the overall system a “Great Transshipment Scam.” The US government indicated it has deployed artificial intelligence tools to identify and combat these transshipment efforts.
A Chinese embassy spokesperson responded by stating that trade wars benefit no party and opposed the US tariff measures as well as the use of state power to target Chinese companies. The spokesperson also emphasized that actions addressing transshipped goods should not harm the interests of third-party nations.
The report emerges amid escalating trade tensions and arrives weeks before scheduled discussions between US President Donald Trump and Chinese leader Xi Jinping in Washington. Analysts suggest the findings could strengthen the American negotiating position in upcoming trade negotiations. An economics professor noted that while some changes in trade patterns may reflect legitimate supply-chain reorganization, the allegations indicate that countries with deeper ties to Chinese production networks now face additional risks and potential costs.
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