United States of America

White House Publishes Transshipment Report

Is Chinese transshipment fraud bleeding America dry or are U.S. businesses simply dodging Trump's damaging tariffs?

AUG 14·Updated AUG 17

White House Publishes Transshipment Report

Story

Above: The Port of Long Beach, California, on Jan. 14. Image credit: Allen J. Schaben/Los Angeles Times/Getty Images

The Facts

The U.S. is losing between $19 billion and $26 billion in tariff revenue per year due to fraudulent transshipping practices, according to estimates included in the White House's new report published on Thursday.
The White House
FOX News
EuroNews
Produced by the Office of Trade and Manufacturing Policy, the report claims that between $34.2 billion and $303 billion worth of goods are transshipped annually to evade U.S. tariffs, based on a series of estimates.
The White House
The report alleges that transshipment activity has increased to current levels after Section 301 tariffs were imposed on China in 2018, with goods shipped directly from China instead routed through third countries and relabeled, repackaged or minimally processed to appear to have a different national origin.
The White House
Today, the White House identifies more than 40 countries at elevated transshipment risk, including major trading partners like the EU, Canada and Mexico, as well as smaller economies, such as Costa Rica and Panama, grouped into three tiers based on their scale and role.
The White House
The White House insists that the trade has substantial impacts on the U.S. economy, calculating that illegal transshipments, assuming a central case of $75 billion annually, displace approximately 450,000 jobs in the U.S. and result in $113 billion to $150 billion in reduced annual gross domestic product (GDP).
The White House
U.S. Customs and Border Protection, however, has begun using AI in a prototype system called "Detective Border" to detect transshipped goods, and importers found to have falsified a product's country of origin can face retroactive tariffs stretching back approximately a year.
The White House
Just The News
BBC News

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The Spin

Pro-Trump narrative

The Great Transshipment Scam is bleeding America dry, with Chinese goods slipping into U.S. markets under fake identities, costing billions in lost tariff revenue and killing manufacturing jobs across the country. The Trump administration's AI-powered Detective Border, however, will provide exactly the kind of enforcement muscle needed to put an end to this fraud for good.

The New York Times

The White House

Anti-Trump narrative

The administration talks a good deal about stopping transshipments but wildly misses the target. Rather than conspiring foreign states, the ones behind this are American businesses tired of bearing the costs of Trump's tariffs. If the White House really wants to address this, it should scrap the damaging tariff regime altogether, not build an even bigger bureaucracy to enforce it.