China allegedly relabeling with ‘Made in Vietnam’ to avoid U.S. tariffs

Workers load goods for export onto a crane at a port in Lianyungang . REUTERS/Stringer

Vietnam has said it will crackdown on goods of Chinese  origin illegally relabelled “Made in Vietnam” by exporters seeking to avoid U.S. President Donald Trump’s tariffs on Chinese imports. 

Vietnamese customs have found scores of such cases amid the ongoing U.S.-China trade dispute, the department said in a statement posted to a government website on Sunday.

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“The faking of origin and the illegal transshipment of goods happens most often in the sectors of textiles, seafood, agricultural products, tiles, honey, steel and iron, aluminum and timber products,” the department said in the statement.

Some importers had been illegally re-packing goods from China in “Made in Vietnam” packaging and then applying for a Vietnamese certificate of origin with which to export to the United States, Europe and Japan, Vietnam customs said.

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In one such example, which the statement said was uncovered by U.S. customs, a Vietnam-based manufacturer of timber products was found to have been importing Chinese timber which it then relabelled and exported to the United States.

Vietnam‘s customs department is developing a process to better identify and impose penalties on businesses which carry out such violations, the statement said.

Vietnam has emerged as one of the largest beneficiaries of the trade war between Beijing and Washington as some businesses are shifting their supply chains away from China in order to avoid tariffs. An analysis of trade data by Japan’s Nomura Holdings Inc earlier this month showed Vietnam had easily benefited more than other countries.

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The Southeast Asian country relies heavily on China for materials and equipment for its labor-intensive manufacturing. Meanwhile, the United States is its largest export market.

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Foreign minister Pham Binh Minh said in a speech to Vietnam‘s national assembly last week that the government has created a steering committee in response to the trade war.