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Asia remains integral to world’s manufacturing strategy

Asia remains integral to world’s manufacturing strategy


Asia’s sophisticated electronics supply chain and massive labour pool are two obstacles standing in the way of President-elect Donald Trump’s pledge to make US companies bring manufacturing jobs home.

When Jabil Circuit Inc., the world’s third-largest contract manufacturer by revenue,needed to quickly ramp up production of its electronics components a few years ago,the company was able to add 35,000 workers in China in less than six weeks. Jabil’s experience underscores the integral roles of China’s armies of migrant workers and Asia’s decades-old supply chain in global electronics production. It is an issue Mr Trump will need to address if he wants to bring large-scale production back to a US economy thatWashington, DC think tank Economic Policy Institute estimates has lost more than 5.4million manufacturing jobs and 82,000 factories between 1997 and 2013.

The President-elect has threatened to impose a 45 per cent tariff on Chinese imports to the country. This move could hurt companies manufacturing in China, such as Apple, DellTechnologies, and HP Inc. It would drag down China’s GDP by 4.8 per cent and Chinese exports to the US by 87 per cent in three years, according to Daiwa Capital Markets Hong Kong’s Kevin Lai.