The administration of the President of the United States has placed Uzbekistan on a list of countries associated with heightened risk of illegal transshipment of Chinese goods through third countries to circumvent American tariffs. The designation appears in a report titled "The Great Transshipment Scam," published by the Office of Trade and Manufacturing Policy. The report's cover features an image of a Trojan horse.
"The United States faces a growing problem of illegal transshipment of goods through third countries aimed at evading tariffs and other trade measures. Exporters from countries subject to higher duties can exploit differences in U.S. tariff treatment by rerouting goods through countries facing lower tariffs before those goods reach the American market," the report states.
According to its authors, illegal transshipment can involve relabeling, repackaging, re-invoicing, minimal processing, false declarations of country of origin, or other measures designed to "secure a tariff treatment that would not apply if the true economic origin of the goods were declared."
China represents the most illustrative historical example of this practice, the report argues. After the United States imposed tariffs on Chinese goods in 2018, Chinese exporters "increasingly" began rerouting shipments through third countries. Other nations are now adopting the "Chinese model" to avoid U.S. tariffs, the authors write.
The report states that this "Chinese shadow transshipment network" includes some of America's largest trading partners, many Southeast Asian nations, and a "vast number" of smaller countries.
The White House contends that China-linked exporters use such countries because they offer cheap labor, weak customs enforcement, bonded warehouses, specialized assembly facilities, and preferential access to the U.S. market.
"Over time, these lower-tariff countries — of which there are now more than 40 — have become the launchpad and hub of a new system of duty evasion: goods largely manufactured in China undergo minimal processing abroad and are exported to America under new designations," the report states.
The document divides countries into three risk categories. The first comprises major trading partners with diversified industrial bases and large export volumes to the United States: Canada, the European Union, India, Israel, Japan, Mexico, South Korea, and Taiwan.
The second group consists of countries with substantial transshipment volumes that are also deeply integrated into Chinese supply chains: Brazil, Indonesia, Malaysia, Thailand, Turkey, and Vietnam.
The third category covers smaller economies with lower trade volumes but a number of facilitating advantages, including free trade zones and weak customs oversight. This group includes 24 countries, among them Uzbekistan, Argentina, Azerbaijan, Costa Rica, Georgia, Kazakhstan, Kenya, Oman, the United Arab Emirates, and Switzerland.
"China-linked exporters may use these jurisdictions both for limited manufacturing activity and to organize logistics routes. As local export and transport networks become increasingly dependent on Chinese resources, logistics, and capital, Beijing may gain additional commercial and geopolitical leverage," the report states.
The White House thus argues that illegal transshipment may deepen commercial dependency within the framework of China's Belt and Road Initiative. Ports, rail corridors, free trade zones, industrial parks, bonded warehouses, and logistics platforms can serve legitimate trade while simultaneously facilitating the rerouting of China-linked shipments, the report notes.
The authors suggest that third-tier countries could serve as "especially useful nodes" in the shadow transshipment network given their reliance on trade with China.
The report also categorizes countries according to the "functional architecture" of the transshipment shadow network. Uzbekistan, Kazakhstan, Azerbaijan, and Georgia are placed within the functional cluster of "Belt-and-Road Overland Nodes," whose primary role is described as "rail and overland transit, cargo consolidation, and transfer of goods from land routes to maritime routes."
Stay up to date with all the latest news:
