The United States has leveled accusations against 38 countries and the European Union, claiming their involvement in a deceptive “shadow transshipment network.” This network allegedly facilitates the entry of Chinese goods, which are subject to high US tariffs, into the American market via third-party countries. A report titled “The Great Transshipment Scam” suggests that this potentially unlawful activity could be valued at approximately $60 billion, causing significant loss in US tariff revenue.
The report identifies several countries and territories as part of this network, including India, Canada, the European Union, Israel, Japan, Mexico, South Korea, Taiwan, Brazil, Indonesia, Malaysia, Thailand, Turkey, Vietnam, Argentina, Azerbaijan, Bangladesh, Cambodia, Chile, Colombia, Costa Rica, the Dominican Republic, Georgia, Jordan, Kazakhstan, Kenya, Laos, Morocco, Myanmar, Oman, Panama, Peru, the Philippines, Singapore, Sri Lanka, Switzerland, the UAE, and Uzbekistan. It further alleges that around $67 billion worth of goods bound for the US were transshipped through key hubs such as Mexico, India, and Vietnam in 2025, leading to an estimated $28 billion in lost tariff revenue for the United States.
The report draws particular attention to the Pune-Gujarat-Chennai corridor in India, suggesting that Chinese shipments of items like electric pumps and compressors have been advantageous to businesses along this route. This, in turn, has reportedly heightened competitive pressures on American manufacturers, adding another layer to the economic impact of these transshipment practices.
In response to these findings, the United States is considering a series of countermeasures. These could include more rigorous inspections and interdictions, the imposition of additional tariffs, the application of sanctions, and possibly restricting market access for countries that are found to be facilitating such tariff evasion. These steps aim to mitigate the financial and competitive consequences identified in the report and protect US economic interests.