China's Transshipment Scheme Has Failed
Posted On
November 12, 2026
The scheme to avoid U.S. tariffs by exporting semi-finished products from China followed by simple assembly in Southeast Asia is no longer feasible. New Section 301 tariffs added another 12.5% tariff on imports from Vietnam and Thailand and 10% on those from Malaysia, Indonesia, and Cambodia. U.S. Customs has strengthened enforcement against false claims of origin and transshipment. While not enough to cause another large-scale factory relocation, these measures discourage transshipment.
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