China’s authorities are not sitting idly. They have found a way to bypass US tariffs. According to the Financial Times (FT), Chinese exporters are now shipping goods to the US through third countries. In doing so, they are essentially “laundering” their exports. No doubt, such measures were prompted by the import tariffs imposed by US President Donald Trump.

To conceal the true origin of the goods, Chinese companies label them as being produced in other countries. As a result, firms have emerged in China that offer product re-registration services. They assist exporters by routing goods through third countries, such as Malaysia, where the products receive a new certificate of origin before being sent to the US. Other countries, such as South Korea, have also become transit hubs.

“Recently, there has been a sharp increase in the number of cases where our country is used as a transit route for goods. This is done to circumvent various restrictions due to changes in US trade policy. Many cases have been discovered where Chinese goods were falsely labeled as South Korean in origin,” South Korea’s Customs Agency stated.

In addition, the massive influx of goods from China has caused concern in neighboring countries, which fear becoming re-export hubs. In response, Vietnam’s Ministry of Industry and Trade has called for stricter control over the origin of commodities and components. Vietnam’s authorities aim to prevent the issuance of fake certificates of origin.

Currently, the total US tariffs on imports from China have reached a staggering 145%. In return, China imposed retaliatory tariffs of 125%, while also eliminating duties on some imported goods. In this situation, China has urged its trade partners not to succumb to the pressure from President Trump, aimed at isolating Beijing amid the ongoing confrontation with Washington.