Geopolitical factors, rather than purely commercial considerations, are now the primary drivers of supply-chain shifts, with government pressure likely to intensify over the decade.
China’s emergence as the global manufacturing hub began with its accession to the World Trade Organization (WTO) in 2001. China then quickly improved its supply chains and productivity to manufacture higher value products at a low production cost.
Key Takeaways
- China’s rising production costs have prompted the shift of supply chains to Southeast Asia, particularly for labor-intensive goods.
- The Sino-US trade war and the COVID-19 pandemic have accelerated the relocation of manufacturing bases from China to countries like Indonesia, Thailand, and Vietnam.
- Southeast Asia’s increasing investment in…