Wednesday, April 30, 2025

30: Trade

Donald Trump's Approval Rating Suffers Quadruple Blow
U.S. economy shrinks 0.3% in first quarter as Trump trade wars disrupt business
US ready to sign Ukraine minerals deal ‘this afternoon’, as Kyiv sends minister to Washington
Readers give their verdict on Trump’s 100 days: ‘Extraordinary destruction’
The big decision that could shape AOC’s future Faced with the stresses of President Donald Trump’s second term, Democratic voters are yearning for younger and more assertive leadership. Many see exactly what they are looking for in Ocasio-Cortez, 35, who has traveled the country in recent months, packing rally after rally with Sen. Bernie Sanders (I-Vt.) and fueling speculation about a potential White House run. ........ many members see her as the perfect fit for the Oversight job — a skill requiring media savvy, quick thinking and a political killer instinct. .......... But others off Capitol Hill think she’s better off seeking a bigger stage and continuing to build a national platform to reshape the future of the Democratic Party. Instead of chasing a mid-level House job, some suggest she’s better off preparing a run for Senate or even the presidency in 2028. .............. “I think the work being done in Oversight by the minority party is way less important than the work being done in communities and across America painting a different path, a different vision for the Democratic Party,” said Corbin Trent, a former Ocasio-Cortez aide. ......... “I think we really are in the midst of defining what the next political era could be and defining what the Democratic Party should be,” added an ally of Ocasio-Cortez granted anonymity to speak candidly. “And I think she has a much bigger role to play in that conversation than she does in the kind of nitty-gritty of gaining power within the House.”

Deepfake porn is destroying real lives in South Korea

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30: Trump

Trump’s Trade War
Peace For Taiwan Is Possible
The Last Age of War, The First Age of Peace: Lord Kalki, Prophecies, and the Path to Global Redemption
AOC 2028: : The Future of American Progressivism

Trump’s Trade War
Peace For Taiwan Is Possible
The Last Age of War, The First Age of Peace: Lord Kalki, Prophecies, and the Path to Global Redemption
AOC 2028: : The Future of American Progressivism

Trump’s Trade War
Peace For Taiwan Is Possible
The Last Age of War, The First Age of Peace: Lord Kalki, Prophecies, and the Path to Global Redemption
AOC 2028: : The Future of American Progressivism

Trump’s Trade War
Peace For Taiwan Is Possible
The Last Age of War, The First Age of Peace: Lord Kalki, Prophecies, and the Path to Global Redemption
AOC 2028: : The Future of American Progressivism

Trump’s Trade War
Peace For Taiwan Is Possible
The Last Age of War, The First Age of Peace: Lord Kalki, Prophecies, and the Path to Global Redemption
AOC 2028: : The Future of American Progressivism

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Methods of Rerouting Exports

China has been rerouting its exports since the U.S.-China trade war began in 2018, primarily to evade high tariffs and maintain access to global markets, especially the U.S. Rerouting involves redirecting goods through third countries or restructuring supply chains to obscure the origin of Chinese products. Here’s how China has been doing it, based on available evidence:

Methods of Rerouting Exports
  1. Transshipment Through Third Countries:
    • Chinese goods are shipped to intermediate countries (e.g., Vietnam, Malaysia, Thailand, Cambodia, Indonesia, or Mexico), where they are minimally processed, relabeled as originating from that country, or simply repackaged before being exported to the U.S. This allows Chinese exporters to bypass U.S. tariffs on Chinese goods, which have escalated to 145% in 2025, while third countries face lower or no tariffs (e.g., 10% for some nations).
    • For example, during the 2018–2019 trade war, 16.5% of Vietnamese exports to the U.S. at the product level were estimated to be rerouted Chinese goods, though only 1.7% at the firm level, indicating significant transshipment activity.
    • Vietnam has been a key hub, with Chinese exports to Vietnam surging 19% in March 2025, reflecting increased rerouting to leverage Vietnam’s lower tariffs.
  2. Setting Up Manufacturing in Third Countries:
    • Chinese firms have invested heavily in Southeast Asia and other regions to establish production facilities. This allows them to produce goods outside China, qualifying for lower tariffs under trade agreements or less stringent U.S. policies. For instance, Chinese solar panel manufacturers shifted assembly to Malaysia, Thailand, and Vietnam to evade U.S. tariffs imposed in 2018.
    • This strategy also helps Chinese companies maintain access to U.S. markets by integrating into local supply chains, as seen with tech giants like Tencent and Douyin launching programs to reroute exports through new production bases.
  3. Exploiting Supply Chain Complexity:
    • Chinese firms use global supply chains to obscure the origin of components. For example, U.S. imports of solar panels from Southeast Asia often contain Chinese-made components, indirectly sustaining Chinese exports despite tariffs.
    • This is facilitated by China’s role as a supplier of critical inputs (e.g., rare earths, semiconductors), which are incorporated into products assembled elsewhere, making it harder for U.S. authorities to trace and tariff them.
  4. Frontloading Shipments:
    • In anticipation of tariff hikes, Chinese exporters have rushed shipments to the U.S. or third countries before new duties take effect. In March 2025, China’s exports surged 12.4% year-on-year, driven by businesses frontloading to avoid U.S. tariffs that rose to 145%. This temporary boost reflects strategic timing to reroute goods through less-tariffed routes before restrictions tighten.
  5. Diversifying Export Markets:
    • China has redirected exports to non-U.S. markets, particularly in Southeast Asia and the EU, to offset losses from U.S. tariffs. Exports to ASEAN countries grew 11.6% in March 2025, and China has expanded trade ties with the EU to absorb excess production. This reduces reliance on the U.S., which now accounts for only 10% of China’s total trade.
    • This shift is part of a broader strategy to build alternative markets, including through initiatives like the “Digital Silk Road,” where tech firms pivot to regions less affected by U.S. tariffs.
  6. Offshore Trade Models:
    • China is experimenting with models where goods are bought and sold globally without entering Chinese territory, reducing exposure to U.S. tariffs. This involves using overseas warehouses or trading hubs to manage exports, as highlighted in posts on X discussing China’s new trade strategies.
Evidence and Impact
  • Scale of Rerouting: Studies from the 2018–2019 trade war show significant rerouting, with a 47.2% increase in product-level rerouting through Vietnam for a 12.48% tariff hike on Chinese goods. Recent data suggests this trend has intensified, with a 90–94% collapse in direct U.S.-bound Chinese container traffic in 2025, indicating heavy reliance on indirect routes.
  • Economic Drivers: High U.S. tariffs (145% in 2025) and China’s 125% retaliatory tariffs make direct trade unfeasible, pushing Chinese firms to reroute to maintain competitiveness.
  • Challenges: Rerouting is not seamless. It increases costs (e.g., shipping, relabeling, or setting up new facilities), disrupts supply chains, and risks U.S. scrutiny. The Trump administration has accused countries like Vietnam of rebranding Chinese goods, threatening higher tariffs (e.g., 46% on Vietnam, paused for 90 days).
Critical Perspective
While rerouting helps China mitigate tariff impacts, it’s a symptom of deeper trade distortions. The U.S. claims China’s practices (e.g., subsidies, IP theft) justify tariffs, but rerouting undermines tariff effectiveness, potentially flooding other markets with cheap Chinese goods and harming local industries. Conversely, China argues it’s adapting to “unilateral bullying” by the U.S., using rerouting to protect its economic interests. Both sides are entrenched, with rerouting fueling a cycle of escalation rather than resolution.

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