Trump Administration Develops AI System to Stop Chinese Tariff Evasion

The Trump administration is developing an AI-powered detective border system designed to identify and stop the illegal transshipment of Chinese goods. The initiative follows a report from the White House Office of Trade and Manufacturing Policy which identified a shadow transshipment network involving more than 40 countries, including Canada, Mexico, India, Japan, South Korea, and the European Union.

The proposed AI system will analyze X-ray imaging, production capacities, routing histories, and shipment data to find mismatches in cargo declarations. The White House Office of Trade and Manufacturing Policy stated that effective enforcement requires distinguishing legitimate manufacturing and substantial transformation from pass-through trade and origin shifting.

Data provided by the AI firm Exiger estimates that approximately $75 billion in illegally transshipped goods entered the United States between February 2025 and February 2026. This activity resulted in an estimated loss of tariff revenue between $19 billion and $34 billion.