China says U.S. transshipment report disregards facts
China's Commerce Ministry has rejected a U.S. report alleging that Chinese goods are being transshipped through third countries to evade tariffs. Beijing also condemned new U.S. tariffs on Chinese drones, labeling the move as a distortion of facts and an overreach of national security concerns.
Why it matters
This escalation highlights the deepening trade tensions between the U.S. and China, specifically regarding supply chain transparency and the strategic drone industry.
China’s Commerce Ministry said on Thursday (August 20, 2026) that it strongly opposed a U.S. report about transshipment and urged Washington to cease its “irresponsible accusations”.
The report, released last week, said that the U.S. is losing annual tariff revenue of about $19 billion to $26 billion on goods, largely from China, that are transshipped through third countries to avoid U.S. import duties.
The report “disregards facts and distorts right and wrong,” and is aimed at suppressing and blocking Chinese products, He Yadong, a spokesperson for the Ministry, said at a regular press briefing.
China also said it “firmly opposes” new U.S. tariffs on imports of unmanned drones and their components, after President Trump announced duties of up to 100% last week.
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