Tougher U.S. trade penalties on goods originating in one country being re-shipped from another are not expected to immediately follow new U.S. tariffs, three people in Southeast Asia with knowledge of the matter said, easing a major cause of concern.
Southeast Asian countries including Vietnam and Thailand have been explicitly targeted by White House officials for their alleged role in facilitating the so-called transshipment to America of Chinese goods, which would face higher tariffs if shipped directly from China.
The Trump administration imposed tariffs on goods from dozens of countries from Thursday, and in an executive order said products determined to have been illegally rerouted to conceal their country of origin would face additional duties of 40%. But it
did not clarify what constitutes transshipment.
U.S. imports from Southeast Asia’s biggest economies, which rely heavily on exports, are now subject to tariff rates of about 19%, most of those significantly reduced from earlier threatened rates.
Existing U.S. customs guidance states goods from countries with no free trade agreements with Washington, such as Southeast Asian nations, can be labelled as made in the country where they undergo a “substantial transformation” of components, even…