Epidemic is difficult to shake China’s “world factory” status

Morgan Asset Management Asia Pacific chief market strategist Xu Zhangtai 21 published an article that, despite the presence of the new coronavirus epidemic and a trade war, but the status of Chinese factory of the world is difficult to shake in Hong Kong, “South China Morning Post” Web site. Article compiled as follows: Moving painful. So, imagine, will have a multi-million dollar equipment factory moved to a different tax policies and other regulations of another country Control Engineering Copyright , what it would be. Discussion of transnational corporations relocate their factories from China has been under way for some time. But in the global economic slowdown last year and early this year, the first phase of the US-China trade agreement signed by the context, some decision makers may hesitate when promoting the relocation plan. In addition, the US president threatened to Trump This fact means that tariffs on goods from many trading partners, in this increasingly strong protectionist world, almost can not find a safe haven.
▲ Trump data plan (Xinhua News Agency issued)
Although the novel coronavirus epidemic makes this discussion even more urgent, but China should continue to play a leading role in the global manufacturing industry. This is because, as people move, like Control Engineering Copyright , companies need to weigh the pros and cons of relocation. Labor and supply chain is an important consideration, but not the only consideration. For example, CONTROL ENGINEERING China Copyright , China’s logistics infrastructure is enterprise can afford a key reason for the timely delivery and low inventory. China Global Logistics Performance Index ranking in the World Bank’s 2018 first 26, much higher than Vietnam (39th), Indonesia (46th) and other countries. Another consideration is the Chinese domestic market. When the Chinese manufacturing industry in 2001 after joining the WTO began to flourish, their goods are shipped to developed economies. But now, Chinese domestic consumer market is also growing.
▲ China “world’s factory” is difficult to shake. The picture shows the February 17, BMW’s largest production base – located in Shenyang’s Tiexi plant BMW Brilliance Automotive Ltd. return to work. (Panyu Long / photo)
Thus, China will continue as an important production location is still wise. To maintain close relations with Chinese customers is a very charged to continue production in ChinaReason points. Nevertheless, Chinese consumers are changing. They began to spend more money on health care, education and financial services and other services, thus promoting the business operations and changes in workers’ preferences. This means that the Control Engineering Copyright , in the long term , China will change and upgrade the manufacturing and production processes. China is unlikely to lose its position as the world’s factory, but may appear a form with us for decades known very different.

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