The White House has released a report accusing more than 40 countries of facilitating Chinese efforts to circumvent United States tariffs by rerouting exports through nations subject to lower import duties. The report, issued Thursday, identifies Canada, India, Mexico, Japan and South Korea among the transit points allegedly used to evade tens of billions of dollars in tariffs.
White House Trade adviser Peter Navarro stated the practice has cost “American jobs and billions in revenue.” According to government and private sector estimates cited in the report, between $30 billion and $300 billion in goods have been moved from higher-tariff jurisdictions through countries with lower rates.
The process, known as transshipping, involves transferring cargo through an intermediate country while en route to a final destination. The White House alleges China has exploited this practice by using third countries as stopovers and repackaging goods to conceal their true origin, describing the scheme as “fraud cloaked in paperwork” and a “Great Transshipment Scam” operated through a sophisticated global network.
In response to BBC inquiries, a spokesperson for the Chinese embassy in Washington said “trade wars have no winners” and reiterated Beijing’s opposition to U.S. tariff measures and the use of state power to target Chinese companies. The spokesperson added that “any unilateral actions or agreements concerning transshipped goods must not target or harm the interests of third parties.”
The BBC has requested comment from the U.S. embassies of the nations named in the report.
The findings come amid ongoing trade tensions between Washington and Beijing. Despite a pause in most tariffs following negotiations earlier this year, both sides have continued to impose targeted restrictions, including U.S. limits on humanoid robot imports and Chinese curbs on drone exports.
The report is expected to complicate upcoming high-level talks between the two economic powers. The U.S. has deployed artificial intelligence tools to detect transshipment activity, signaling an escalation in enforcement efforts.
Former President Donald Trump previously introduced sweeping levies on dozens of trading partners based on his long-held view that tariffs protect American jobs and the Economy. While some of those measures faced legal challenges, the administration has pursued alternative authorities to maintain its trade policy approach.
The transshipment allegations highlight the complexities of modern supply chains and the difficulties of enforcing trade remedies in a globalized economy. As the world’s two largest economies navigate their commercial relationship, the dispute over origin fraud and tariff evasion represents a significant flashpoint with implications for international trade norms and third-country interests caught between the competing powers.
