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Monday, 5 August 2019

Why is the US suddenly seeing an influx of ‘Made in Vietnam’ goods?

Why is the US suddenly seeing an influx of ‘Made in Vietnam’ goods? They’re not always Vietnamese. Vietnamese tech exports to the US increased by over 70% between May 2018 and May 2019, but many of these goods actually came from China, the Wall Street Journal says (watch, runtime: 04:27). As businesses struggle with the fallout of the US-China trade dispute, an increasing number are resorting to a process called transshipment to bypass hefty tariffs on Chinese exports. This involves moving goods — including electronics, steel and furniture — from China to countries such as Vietnam, Malaysia and Thailand, swapping the “country of origin” label, and then shipping the products to the US.

Uh, isn’t that illegal? In some cases, the companies make minimal concessions to legality by making small changes to the goods (wrapping Chinese steel in a protective zinc layer in Vietnam, for instance) or gathering the components of an electronic device domestically and then outsourcing its assembly. But what they are doing is essentially illegal, and carries increasingly hefty penalties, including fines and even jail time.

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