(Source: Kankan News 2020-04-13)
Larry Kudlow, director of the White House National Economic Council, publicly suggested this past weekend that the U.S. government should fully reimburse the moving expenses of American companies relocating from China.
Almost at the same time, Japan’s Ministry of Economy, w88 and Industry launched an “anti-epidemic economic rescue plan” totaling 108 trillion yen (approximately RMB 7 trillion), of which 243.5 billion yen (approximately RMB 15.8 billion) was specifically used to fund Japanese manufacturing companies to leave China and return to their homeland, or transfer to Southeast Asian countries.
Many people are worried about this. If many companies in the United States and Japan withdraw, will it have an impact on China?
Tu Xinquan, Dean of the China WTO Research Institute at the w88 casinobelieves that although judging from the current situation, it is impossible for the United States and Japan to complete the evacuation of a large number of local companies in the short term, the outbreak of the new coronavirus epidemic is putting the global supply chain through an unprecedented test. As the countries where the epidemic occurred have more or less implemented blockade and isolation measures, it has caused difficulties in the transportation and supply of intermediate products and final products, and companies' access to parts and labor from all over the world has also been severely damaged.
Taking the production of auto parts as an example, according to Japan's "Asahi Shimbun" report, the production of Japanese cars in China dropped sharply in February. The production volume of Nissan Motor and Toyota Motor in China decreased by 87.9% and 77.4% respectively, while the production volume of Honda Motor Company, which has a factory in Wuhan City, Hubei Province, dropped significantly by 92%. Not only Japan, but also automobile manufacturers in many countries, including the United States and Europe, have been affected due to the suspension of parts supply from Wuhan.
Tu XinquanTell Knews that in the past, it was believed that globalized decentralized supply would reduce costs and improve efficiency. However, one risk that decentralized supply may cause is that when extreme situations like this epidemic occur in certain countries, the security of the supply chain will be damaged. Nowadays, in view of the weaknesses of decentralized supply in the global supply chain exposed by the epidemic, I believe that many countries, including Chinese companies, are rethinking their supply chain layout. The most important point is to consider the "resilience" of the supply chain, which is the w88-off between supply chain security and efficiency.
In fact, this is not the first time that American and Japanese companies have withdrawn production lines from China.
In recent years, some manufacturing companies around the world have adopted the new Asia investment strategy of "China + 1". Although the reasons for these companies' decisions vary, the result is the same: They would rather avoid China's rapidly growing economy and locate factories elsewhere in Asia to avoid risks and not put their "eggs in the same basket."
“Instead of saying ‘evacuate’, it is more appropriate to use ‘copy’.” Tu Xinquan believes that before the global epidemic has settled, multinational companies have taken into account the dispersed distribution of the supply chain in the production process. The United States and Japan will at most withdraw some companies to Southeast Asian countries, and will not withdraw all investments from China. This in itself is a business consideration to avoid risks and is a reasonable adjustment of the industrial chain layout.
Tu XinquanEmphasize that judging from the current situation in China, there is no need to be overly worried and panic about the so-called "foreign capital withdrawal from China".
China is currently one of the largest recipients of foreign direct investment in the world. With the upgrading of China's technological level and manufacturing industry, China, as the "world's factory", has an efficient industrial chain, and China's talent and market space continue to increase. On the other hand, stabilizing foreign investment has been one of my country's important measures to stabilize growth for some time. Especially after the outbreak of the COVID-19 epidemic, the large-scale "combination" of policies to stabilize foreign investment and foreign w88 will become the "anchor" for stabilizing foreign investment. It can be said that in the short term, it will be difficult for the global industrial chain to find other solutions to replace China.
However, we must also take precautions to reduce the global industrial chain's dependence on China. Especially as the epidemic develops and continues, some countries may take advantage of the epidemic to exaggerate the so-called "de-Chinaization", which still requires vigilance.
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http://www.kankanews.com/a/2020-04-13/0039216260.shtml
