The escalation of the U.S.-China trade confrontation brings to the fore the term transshipment, which threatens to become a crucial tool of trade policy. The U.S. administration is pressuring Beijing for "concrete actions" under the bilateral trade agreement, while considering tightening the definition of the term.
Transshipment describes the transportation of products from Country A to Country C via an intermediate Country B. In practice, the U.S. sees it as a means used by China to circumvent tariffs by transferring part of the production or final assembly to third countries. An example is the export of semi-finished steel to Vietnam or Mexico, where processing is completed and then exported to the US with favourable tariffs.
Based on World Trade Organization rules, substantial manufacturing changes the country of origin. However, Washington is considering a new definition that would prioritize the initial stage of production, considering the product Chinese even if the final processing takes place elsewhere.
The aim is on the one hand to exclude Chinese inputs from the supply chains of Western companies, reinforcing the policy of decoupling, and on the other hand to curb Chinese overproduction that is pushing on global prices. Despite the reduction of the US-China deficit by 9 billion euros. In 2024, the shortages with Mexico and Vietnam increased by 13 billion dollars. dollars, suggesting a change of routes in Chinese production.
Internationally, alternative ways of determining the country of origin are being discussed, either on the basis of added value or on the basis of the manufacturer's ownership. Although no method has yet been adopted, the American stance leaves open the possibility of applying non-traditional criteria.
Rapid changes in trade figures
The U.S. trade deficit in goods in 2024 exceeded $1.2 trillion. – a historical record. China remained first with about €295 billion. Down from $418 billion. of 2018. Mexico recorded a deficit of €172 billion. While Vietnam rose to $123 billion, up 18% from 2023.
In the twelve months to June 2025, Mexico reached €521.1 billion. In imports to the U.S. (15% of the total), China fell to $407.9 billion. (11.8%) and Vietnam jumped by 54% to $162.9 billion, often as an intermediate hub for Chinese products.
The U.S. change in the definition of transshipment, based on initial production, value-added or corporate nationality, could cause a restructuring of global supply chains and significantly limit the use of third countries as a "clean room" for Chinese production.
Capital.gr
