Background
Overview
This concept is vital for understanding the complexities of international trade, the challenges of enforcing trade policies, and the economic implications of tariff evasion for global supply chains, national revenues, and fair competition. It highlights the unintended consequences of protectionist measures and their impact on bilateral relations.
Transhipment, in the context of international trade, refers to the practice of shipping goods through an intermediate country or port before reaching their final destination. It becomes a method of tariff evasion when goods are rerouted and often marginally altered in a third country to falsely claim a different country of origin, thereby circumventing higher tariffs imposed on goods from their actual country of origin.