(Author GIANG LE and translated by TranHoaiDuc.com)
The latest report by manufacturing consultancy Kearney shows that the US-China trade war and the Covid-19 epidemic are putting pressure on Asian supply chains, setting a new balance for production distribution maps in the next period of time.
Kearney relied on imports of US manufactured goods from 14 Asian countries and US domestic production to calculate the production import ratio (MIR). For the first time since 2011, MIR has decreased from 13.1 in 2018 to 12.1 in 2019.
The reason for the decrease in MIR originated from the import of manufactured goods from 14 Asian countries, which decreased by 7%, from US $ 816 billion in 2018 to US $ 757 billion in 2019. According to Kearney, this situation is mainly caused by the volume of goods sold. Imports from China decreased by about 17% because of the US-China trade rate.
Kearney also calculates the manufacturing allocation index (CDI) in China to track the movement of goods made in China to the US. Although China is still the largest producer, the country's CDI has declined five times in the past six years.
In 2013, China's CDI was 67%, but by the fourth quarter of 2019, the figure dropped to 56%. Among the US $ 31 billion of US imports moved out of China, 46% was absorbed by Vietnam. Vietnam has exported an additional US $ 14 billion of manufactured goods to the US in 2019 compared to 2018.
However, it should be noted that what Vietnam gained in exporting to the US does not really represent that the supply chain is shifting to an S-shaped country. To avoid tax, many Chinese manufacturers have chosen to switch. goods to Vietnam, then export the goods (at this time may have been slightly modified) to the US.
An example is the amount of electronic goods from China to Vietnam increased 78% between May 2018 and 2019, from US $ 2.7 billion to US $ 5 billion. Meanwhile, the volume of Vietnamese electronic goods exported to the US has increased by 72%, from 1 billion to 1.8 billion USD. Vietnam and the US are currently tightening transhipment policies, so over time this form of trade deal may disappear.
Three decades ago, American companies began manufacturing and outsourcing in China for one reason: low cost. The start of the US-China trade war has indicated the second dimension businesses need to consider: the risk of supply chain disruptions due to taxes and sanctions. The Covid-19 translation offers a third dimension: the ability to predict and adapt to unforeseen system shocks.
Facing a series of obstacles due to trade wars and pandemics, US businesses will have little incentive to outsource, but they will still want to put their eggs in the most competitive basket.
The US-China trade war is being "forgotten" when the 2020 Covid-19 pandemic breaks out around the world, closing the door to Western economies and creating a foreign nightmare for China.
Many US companies were unable to access supply in February and early March when a series of factories in China were closed. By the time China started to contain the epidemic and continue to operate its production, the US economy in turn became a victim when the number of infections in the country escalated and quickly became the largest outbreak in the world.
"The economic and social impact of the pandemic has yet to be determined. But whatever the outcome is, and although China and the US can resolve their trade disputes, Chinese trade It is impossible to return to the previous state, "Kearney said in the report.
Going back to the MIR index, does a drop in the share of US manufacturing imports mean that the nation's manufacturing industry will "gain momentum"? The answer is very difficult, as the range of skilled labor force restrictions as well as the promise of automating production lines in the United States have yet to be fully realized.
Facing a series of obstacles due to trade wars and pandemics, US businesses will have little incentive to outsource, but they will still want to put their eggs in the most competitive basket, Kearney points out.
The global manufacturing consultancy also predicts that the Asian supply chain will soon establish a new equilibrium, with the order of production chains in low-cost countries closest to the distribution in 2019. , instead of before the 2016 war
(Source: forbesvietnam.com.vn)
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