The United States has raised allegations against 38 countries and the European Union, accusing them of being involved in what it describes as a “shadow transshipment network.” This network supposedly facilitates the entry of Chinese goods into the American market through intermediary nations, effectively bypassing high US tariffs. The accusations are detailed in a report titled “The Great Transshipment Scam,” which estimates the potential scale of these activities at around $60 billion. The report underscores the financial impact on the US, suggesting significant losses in tariff revenue due to this practice.
The list of nations and territories implicated in this alleged network is extensive, including key players such as India, Canada, the European Union, Israel, Japan, Mexico, and South Korea. Other countries named are Taiwan, Brazil, Indonesia, Malaysia, Thailand, Turkey, Vietnam, and several others spanning multiple continents. According to the findings, these countries serve as conduits for goods originally manufactured in China, enabling them to enter the US market under the guise of originating from these third-party countries.
In particular, the report highlights claims that around $67 billion worth of goods destined for the US were rerouted through major hubs like Mexico, India, and Vietnam in 2025. This practice, it is estimated, may have resulted in around $28 billion in lost revenue from US tariffs. A notable corridor identified within India, the Pune-Gujarat-Chennai corridor, is pointed out as benefiting from Chinese shipments of items such as electric pumps and compressors. This has reportedly given businesses in the corridor an edge while intensifying competition against US manufacturers.
In response to these allegations, the US is considering a series of measures to counteract what it sees as tariff evasion. Proposed actions include enforcing stricter inspections and interdiction measures, imposing additional tariffs, applying sanctions, and potentially limiting market access for countries identified as facilitators of these transshipment activities. The aim of these responses would be to safeguard US economic interests and ensure compliance with tariff regulations.