Overview
- The White House Office of Trade and Manufacturing Policy released the 25‑page 'The Great Transshipment Scam' report on Thursday alleging Chinese exporters have routed goods through more than 40 countries to evade U.S. tariffs.
- Using a central estimate of $75 billion in annual suspect transshipments, the administration models $19 billion to $26 billion in lost tariff revenue, about 450,000 displaced jobs, and $113 billion to $150 billion in reduced annual GDP while noting these are model‑based estimates.
- The report categorizes the 40‑plus nations into three risk tiers and places India in Tier 1 as a major hub where legitimate trade and opportunistic routing overlap.
- To respond, officials said U.S. Customs and Border Protection is prototyping an AI 'Detective Border' to flag suspicious shipments, the U.S. Trade Representative will add anti‑transshipment clauses to new deals, and CBP may be granted authority to seek retroactive tariffs over roughly a year when evasion is found.
- The public naming of allies and trading partners raises diplomatic friction and could complicate upcoming talks between Presidents Trump and Xi while governments named in the report have not yet issued formal responses.