US tariffs target China's trade circumvention via Southeast Asia

The United States imposed significant retaliatory tariffs on Vietnam and Cambodia, targeting goods suspected of being re-routed from China to avoid existing tariffs. This action aims to curb the practice of "country of origin laundering." These new tariffs, 46% on Vietnamese goods and 49% on Cambodian goods, are part of a broader strategy to counter China's trade practices. Several Southeast Asian nations, including Malaysia, are responding by tightening regulations to prevent the transshipment of Chinese goods through their countries. This follows a pattern where companies used the "China Plus One" strategy, setting up operations in Southeast Asia to circumvent tariffs. South Korea is also increasing scrutiny of imports from China to prevent similar practices.