{"id":1796,"date":"2021-08-18T20:21:23","date_gmt":"2021-08-18T13:21:23","guid":{"rendered":"http:\/\/bangkokagenda.com\/?p=1796"},"modified":"2021-08-19T13:10:33","modified_gmt":"2021-08-19T06:10:33","slug":"surge-in-asia-pacifics-largest-manufacturing-centres-driven-by-global-demand","status":"publish","type":"post","link":"http:\/\/bangkokagenda.com\/?p=1796","title":{"rendered":"Surge in Asia Pacific\u2019s largest manufacturing centres driven by global demand"},"content":{"rendered":"

China strengthens its leading position as the most attractive manufacturing hub globally; Thailand sees improvement in cost profile.<\/strong><\/p>\n

Asia Pacific\u2019s largest manufacturing centres have rebounded strongly as economies across the globe have reopened and driven demand for key products, according to Cushman & Wakefield\u2019s 2021 Global Manufacturing Risk Index, which assesses the most advantageous locations for global manufacturing among 47 countries in Europe, the Americas and Asia Pacific.<\/p>\n

 <\/p>\n

Dr. Dominic Brown, Head of Insight & Analysis, Asia Pacific at Cushman & Wakefield, said,<\/strong> \u201cAs the virus is brought under control, manufacturing centres have surged. China has been able to fill the void left by US and European manufacturers, who were enduring their own lockdowns, to capture a larger share of global exports, from approximately 13% in 2019 to 15% in 2020. Furthermore, exports from China in Q1 2021 were about 27% higher than Q2 2019, or the equivalent of US$150 billion.\u201d<\/p>\n

\u201cOther markets also capitalized on heightened demand for key products such as micro-processors, computer chips and pharmaceuticals. South Korea has benefited from the soaring value of semiconductors, stemming from strong demand and a global shortage of product with Information and Communication Technology (ICT) manufacturing up 16.8% year over year in January 2021. However, apparel producers around the region continue to struggle with low levels of demand impacting markets such as India and Indonesia, which have also been managing significant second and third waves of the virus,\u201d noted\u00a0Dr. Brown.\u00a0<\/strong><\/p>\n

Within mainland China, two clear trends have been underway: (i) manufacturers moving up the value chain following large-scale investment into robotics, artificial intelligence and blockchain; and (ii) manufacturing of lower order goods moving outside of the country, predominantly into Southeast Asia. There has been a 5% increase in Jakarta\u2019s industrial stock in the last year alone. There has also been increasing interest in India, especially given the country\u2019s proven success in meeting outsourcing requirements.<\/p>\n

Furthermore, Vietnam has become an increasing focus for manufacturers due to its regional centrality, sublime market integration, and favourable production costs \u2013 with Samsung, Apple, Nintendo, LG, Panasonic and Intel all locating in the country. Vietnam is also moving up the value chain, positioning itself as very attractive for mid-tech with its electronics sector.<\/p>\n

 <\/p>\n

On this year’s baseline rankings, Thailand rates favourably on cost competitiveness. The country\u2019s cost profile improved, moving Thailand to fifth place from the eighth and ahead of Malaysia, which has seen ongoing wage increases, the report noted.<\/p>\n

Gareth Michael Powell, Senior Director at Cushman & Wakefield, Thailand, said,<\/strong>\u00a0\u201cThe Thai manufacturing sector has expanded in 2021 on improved domestic demand, a rapidly growing e-commerce sector, recovery of world trade volumes, and government-driven growth from budget disbursements and economic stimulus measures. We are optimistic about Thailand\u2019s industrial property market outlook, given the upturn in external goods demand and exports remaining a key pillar of economic strength.\u201d<\/p>\n

2021 Manufacturing Risk Index Rankings \u2013 Key takeaways\u00a0<\/strong><\/p>\n

Cushman & Wakefield\u2019s annual Global Manufacturing Risk Index (MRI) scores each country against 20 variables that make up the three final weighted rankings which cover conditions, cost, and risk. The data underpinning the MRI comes from a variety of reliable sources, including the World Bank, United Nations, World Economic Forum and Moody\u2019s Analytics.<\/p>\n

Based on the analysis, China took the number one spot across all the four rankings, strengthening its leading position as the most attractive manufacturing hub globally.<\/p>\n