Seoul: U.S. President Donald Trump's administration has flagged South Korea, Japan, Taiwan, and the European Union among numerous economies at risk of transshipment involving China-linked goods. This action is part of a broader effort to address schemes circumventing U.S. tariffs and trade remedies, as revealed in a White House report released Thursday.
According to Yonhap News Agency, the White House Office of Trade and Manufacturing Policy released a document titled "The Great Transshipment Scam," which identifies approximately 40 countries with "elevated" transshipment risks. The report highlights how Chinese exporters allegedly reroute goods through third countries using methods such as relabeling, repackaging, and false country-of-origin claims.
The report emphasizes the development of a "detective border" that employs artificial intelligence (AI) to aid U.S. Customs and Border Protection. This initiative aims to integrate shipment data, routing histories, and other relevant information to identify high-risk shipments and facilitate duty collection and other measures.
South Korea, Japan, Taiwan, the EU, India, Canada, Mexico, and Israel are classified as "diversified scale leaders." These nations are noted for their diversified industrial bases and significant U.S.-bound export platforms, where transshipment risks are embedded within broader legitimate trade flows.
Brazil, Indonesia, Malaysia, Thailand, Turkey, and Vietnam fall under the category of "scale leaders with significant economic integration." These countries reportedly combine illegal transshipment volumes with deeper integration into China-linked supply chains, input sourcing, manufacturing platforms, logistics systems, or regional rerouting channels.
The report also identifies smaller economies as "small, opportunistic Chinese targets," which include Switzerland, Singapore, the Philippines, the United Arab Emirates, Chile, and Colombia. These nations possess specific "weak-link advantages" such as low-cost labor, port or border access, niche assembly capacity, and preferential U.S. access, making them attractive targets for China-linked rerouting.
The report warns that by circumventing tariffs, China and its state-supported manufacturers and trading firms could infiltrate jurisdictions with cheap labor, weak customs oversight, permissive free zones, or preferential U.S. trade access. Over time, these lower-tariff countries have become the launchpads and hubs of a new evasion architecture: products primarily made in China, minimally processed abroad, and exported to America under new identities.