US Report: 40+ Countries Help China Evade Trump Tariffs via Transshipment

The White House released a report this week documenting what it calls an elaborate scheme to circumvent American tariffs: more than forty countries, working in concert with China, have been routing goods through nations with lower import duties to shield Chinese exports from the full weight of US levies.

The countries implicated read like a roster of major trading partners—Canada, India, Mexico, Japan, South Korea among them. According to the White House's accounting, this practice has allowed China to evade tens of billions of dollars in tariffs that would otherwise have applied. Peter Navarro, the White House trade adviser, framed the cost in blunt terms: lost American jobs and billions in foregone government revenue.

The mechanism is straightforward in concept but sophisticated in execution. Goods manufactured in China move to a third country—one that faces lower American tariff rates—where they are repackaged, their origins obscured, and then shipped onward to the United States under false documentation. The White House calls this "fraud cloaked in paperwork." Estimates of the total volume vary wildly: government and private sector analysts cited by the White House suggest somewhere between thirty billion and three hundred billion dollars in goods have moved through this pipeline, the wide range reflecting the difficulty of tracking goods that are deliberately disguised.

The practice itself, known as transshipping, is not new. What has changed, according to the White House report, is the scale and sophistication. The administration describes a "Shadow Transshipment Network" spanning the globe, orchestrated with such precision and breadth that it amounts to what it calls a "Great Transshipment Scam." The US has begun deploying artificial intelligence tools to detect these schemes, an acknowledgment that traditional customs inspection cannot keep pace with the volume and complexity of modern trade flows.

China's embassy in Washington responded to inquiries by asserting that trade wars benefit no one and that the United States should not use state power to target Chinese companies. The embassy also cautioned that any actions addressing transshipped goods must not harm the interests of third parties—a pointed reminder that many of the countries named in the report are themselves caught between American pressure and economic incentives to facilitate Chinese trade.

The timing of the report is significant. It arrives as tensions between Washington and Beijing continue to simmer despite a pause in most tariffs following talks in May of last year. The two sides have continued exchanging sanctions: the US has restricted shipments of humanoid robots from China, while Beijing has tightened controls on drone exports. Trump introduced sweeping tariffs in April 2025 based on his long-held conviction that such duties would strengthen American manufacturing and employment, though the Supreme Court later struck down those particular levies. He has since found alternative legal mechanisms to impose new tariffs, keeping his signature policy alive even as courts have constrained his authority.

All of this unfolds in the shadow of a planned meeting between Trump and Chinese leader Xi Jinping scheduled for September in Washington. The transshipment report is expected to become another point of friction in those talks, adding to an already crowded agenda of disputes over trade, technology, and economic competition. Whether the report will harden positions or serve as a catalyst for negotiation remains unclear, but it signals that the administration intends to press the issue hard.