Trade and company data analyzed by Bloomberg traces a route where Chinese wafer producers shipped materials to newly built solar-cell factories in Kenya and Nigeria, which then shipped cells to assemblers in Indonesia's Batam island, who exported finished panels to the US without triggering Indonesia-specific tariffs. US imports from those African countries surged to nearly $100 million per month by June, even as recorded Indonesian export data diverged sharply from what US customs recorded as imports.
The scheme exploits a 'substantial transformation' customs rule under which a panel's country of origin is determined by where its solar cells, not final assembly, are made. New tariffs and price floors ordered by Trump, effective December 4, aim to close this loophole by applying minimum import prices and 15% tariffs across all countries rather than country-by-country.
Indonesia's trade ministry said the export-import discrepancies are not significant and doesn't indicate mislabeling or circumvention. Chinese manufacturers, facing near-zero domestic profit margins from overcapacity and price wars, have strong incentives to keep expanding overseas regardless of the new rules.
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