The White House has added Uzbekistan to the list of countries associated with an increased risk of illegal transshipment of Chinese goods through third countries to circumvent American customs duties. This information is contained in the document 'The Great Transshipment Scam,' published by the Office of Trade and Industrial Policy. The cover of this report features a Trojan horse.
The report emphasizes that the United States is facing a growing problem related to the illegal transshipment of goods through third countries to evade established tariffs and other trade restrictions. Exporters from countries subject to higher duties may exploit differences in the US tariff regime by rerouting products through countries with lower tariffs before they enter the American market.
The authors define illegal transshipment as activities that may include relabeling, repackaging, invoice alteration, minor processing, providing false data on country of origin, or any other actions aimed at ensuring a tariff regime that does not correspond to the true economic origin of the goods.
China is presented in the report as the most prominent historical example of such practices. After the US imposed tariffs on goods from China in 2018, Chinese exporters increasingly began rerouting their products through third countries. The authors note that other nations are now following this 'Chinese model' to avoid American duties.
According to the report, the 'Chinese shadow network' for cargo transshipment covers major American trading partners, numerous Southeast Asian countries, and many small states.
The White House asserts that Chinese exporters prefer to use such countries due to the availability of cheap labor, weak customs control, customs warehouses, specialized assembly capabilities, and preferential access to the American market.
The document indicates that over forty countries with lower customs duties have become starting points and centers of a new system for evading duties. Goods, predominantly produced in China, underwent minimal processing abroad and were then exported to America under new names.
The document classifies countries into three categories based on the nature of the risk. The first group includes major trading partners with diverse industries and significant export volumes to the US, including Canada, the European Union, India, Israel, Japan, Mexico, South Korea, and Taiwan.
The second group consists of countries with substantial transshipment volumes and deep integration into Chinese production chains: Brazil, Indonesia, Malaysia, Thailand, Turkey, and Vietnam.
The third group comprises smaller economies that have smaller volumes but possess certain advantages, such as free zones and relaxed customs control. This group includes 24 countries, among which are Uzbekistan, Argentina, Azerbaijan, Costa Rica, Georgia, Kazakhstan, Kenya, Oman, UAE, and Switzerland.
The report notes that Chinese exporters can use these jurisdictions both for limited manufacturing activities and for organizing logistics routes. As local transport and export networks become increasingly dependent on Chinese capital, resources, and logistics, Beijing could potentially gain additional geopolitical and commercial influence.
Thus, according to the White House, illegal cargo transshipment can strengthen commercial dependence within the 'One Belt, One Road' initiative. The report indicates that ports, railway corridors, industrial parks, logistics platforms, and customs warehouses can be used for both legitimate trade and for rerouting goods related to China.
The study's authors believe that countries in the third group can act as 'particularly useful nodes' in the shadow network of cargo transshipment due to their reliance on trade with China.
Furthermore, the report presents a diagram showing the distribution of countries across the 'functional architecture of the shadow cargo transshipment network.' Uzbekistan, Kazakhstan, Azerbaijan, and Georgia are assigned to the functional cluster 'Belt-and-Road Overland Nodes.' Their primary function is defined as 'rail and land transit, cargo consolidation, and transfer of cargo from land routes to sea.'