Benjamin King’s Post

Excellent and insightful article from South China Morning Post SCMP on the challenges of #Vietnam as a China +1 #manufacturing destination. #supplychain https://shorturl.at/MFi3t

Southeast Asia is becoming a go-to hub as companies diversify supply chains to manage U.S.-China trade tensions. With increased investments, countries like Vietnam and Thailand are well-positioned to gain from this shift.

Global Trade: For every action, there is an equal and opposite reaction - Newton. 🚘 BEVs vs. Pigs 🐖 While Newton was talking about physics, the same can often be said for Global Trade. No country wants to be unilaterally punished for products they sell and will often fight back by enacting new regulations on products that they buy. This isn't a new phenomenon; it's as old as trade itself. As political relations with China and the West continue to deteriorate, it's logical and common for politicians to use trade to punish their adversaries. It's complicated because at the base level, economics is the most direct form of punishment. However, there could be other very valid reasons for tariffs beyond economics, such as concerns over technology transfer, jobs, and strategic interests. Still, the fact remains that in addition to being a huge maker of things (a manufacturer), China is also a huge buyer of things (a consumer). What China buys most is things to support its massive population of 1.4 billion people, including basics such as food and oil. In this example, China purchases $6.45 billion worth of pork from the EU. The complexity of trade is that the equal and opposite reactions can have unintended consequences. For example, a country may retaliate by buying oil from a country that is an enemy of the EU or purchasing food from other countries, hurting the EU farmers who are the current source. Additionally, as the US is also imposing restrictions on electric vehicles, it could have an impact on its own push towards more electric vehicles. So while it seems incongruous that China launches an anti-dumping probe on the EU for pork in retaliation for increasing tariffs on electric cars, it's actually consistent with the nature of trade. Countries often trade products that are abundant in their area in exchange for products that are not. Often, this is a win-win for both parties; however, not if it's true and/or perceived to be true that there are greater issues at stake than in this example of simply BEVs Vs. Pigs. In conclusion, it's often believed that countries who trade with each other are less likely to be openly hostile to one another. However, as trade tensions continue to rise, it's crucial to consider the potential spillover effects into other areas of international relations. Policymakers must navigate these complex issues carefully to avoid escalating tensions beyond the realm of trade. #Trade #globaleconomics #china #EU #US #Supplychain

Mielenkiintoista pohdiskelua Nikkei Asian uutiskirjeessä USA:n rajuista tuontitullien korotuksista useille kiinalaisille tuotteille - onko loppupeleissä kyse lähinnä presidenttipelistä, jossa Kiina on yksi Bidenin kampanjan pääteemoista: "Washington cited concerns that dumping of cheap Chinese goods could harm the U.S. job market and industries. But a closer look reveals that the seemingly drastic tariff hikes may be little more than paper tigers.  ...Similarly, with electric vehicles, Chinese brands have a minimal presence in the U.S. In short, the tariff hikes seem largely symbolic and unlikely to cause much disruption to U.S.-China trade. ...Supply chain executives increasingly use the term "China for China," indicating a shift towards self-sufficiency and preferring local consumption. This trend, along with similar movements by other governments, reinforces the feeling that the world is moving toward a more bipolar economic landscape." #kriittisetmateriaalit #akkumateriaalit #sähköautot #yhdysvallat #tuontitullit #kiina #geopolitiikka #paperitiikerit #ChinaForChina https://lnkd.in/dfMx7dGJ

Interesting update on the China +1 strategy where Vietnam is becoming less attractive to Chinese manufacturers due to rising costs and logistical challenges. Companies face higher raw material and operational expenses, offsetting savings from US tariff avoidance. Vietnam's supply chain maturity and regional policy variations add to the complexity. Despite these hurdles, it remains a strategic option for tariff bypassing. However, future expansions are uncertain.

Really informative article on the continued emergence of Mexico within the global supply chain, specifically its impact on the U.S. amid China/U.S. trade tensions. With the upcoming election and so much speculation and uncertainty around trade policy, I can’t help but feel for shippers trying to navigate and develop long-term strategies right now! 😵 https://lnkd.in/gnEvMRuN

Global Manufacturing Shifts: How Small Businesses Are Navigating the New Landscape - Amid rising tariffs and trade uncertainties, U.S. small businesses are rethinking their reliance on China for manufacturing. Countries like Mexico, Vietnam, and Kenya are becoming attractive alternatives, but the shift is complex. High minimum orders, quality concerns, and tight profit margins challenge these transitions. Some businesses are taking bold steps to diversify supply chains and even bring production back to the U.S., despite higher costs. This could significantly reshape import patterns and manufacturing strategies. As global trade evolves, adaptability is key for businesses of all sizes. What strategies do you think will define the future of global manufacturing? I'm curious to hear everyone's thoughts. #GlobalTrade #SupplyChain #Manufacturing #Tariffs #BusinessStrategy #SmallBusiness #GlobalEconomy #TradePolicy #Logistics #Nearshoring #Reshoring #EconomicTrends #InternationalBusiness #TradeUncertainty Pat Huffine

▶ TRADE BARRIERS WON'T PROTECT US The government should assess the competitiveness of domestic industries rather than imposing trade barriers on imported products. That is not to say there is never a good reason for trade barriers. There are all sorts of good reasons, including an influx of products from another country if there is credible evidence of unfair subsidies or dumping. But let us be honest here. Many of our manufacturers are not competitive and would fail to hold their own against Chinese rivals even under the fairest of circumstances. Import duties can buy us time, but we must use that time to build up domestic capacity by improving logistics, manpower and supply chains, and also by making sure our manufacturers can import what they need to grow strong. Read more: https://lnkd.in/g6mY4mfW #business #economic #trade #barrier #competitiveness #manufacture #indonesia #editorial #opinion #thejakartapost

Vietnam: A Rising Star in Global Manufacturing Amid Trade Shifts As global manufacturers navigate the impacts of U.S. tariffs on China, Vietnam is emerging as a major beneficiary. With its strategic location, competitive labor costs, and growing infrastructure, Vietnam, Thai Lan and some other Southeast Asia countries are becoming go-to destinations for industries relocating production from China. This shift is strengthening Southeast Asian countries’ role in global supply chains, creating opportunities for new investments, and boosting economic growth. The country’s agility in attracting diverse sectors, from electronics to textiles, underscores its resilience and strategic advantage in today’s economy. #VietnamEconomy #Manufacturing #SupplyChain #Investment

Donald Trump's proposed rollback of the CHIPS Act and his threat of 60% tariffs on Chinese goods signal a potential escalation in US-China tensions. While these measures aim to strengthen US manufacturing and trade positions, they risk destabilising global supply chains and triggering severe economic and geopolitical consequences. China, better prepared than during the 2018 trade war, could respond with targeted export controls and currency devaluation, sparking further uncertainty in global markets. What do these policies mean for global stability and the future of tech and trade relations? I look forward to discussing the Geopolitical Chessboard post US elections at The Tech Capital in Jakarta 20-21 November 2024. https://lnkd.in/dqn-zbaY #Technology #Economy #Innovation #Management #Economics https://lnkd.in/gwdv9emw