President Xi Jinping’s to Vietnam, a rare 2023 trip outside his country, showcased how he isn’t standing idly by while Washington attempts to diminish China’s role in supply chains that end in American consumption.
On the surface, US friend-shoring moves appear to be having an impact, with Chinese goods making up a diminishing share of American imports, direct investment in China on the wane and investment in other emerging markets soaring.
A closer look also shows that Chinese exports to nations that are rising in the ranks of US import sources—like Mexico—are climbing. This suggests China is simply re-routing a chunk of its shipments. And back home, Xi’s government is doubling down on investing in high-value-added manufacturing to replace the lower-end production that’s shifting abroad.
When Western capitals realize their friend-shoring project is being undermined, the risk is a new wave of protectionist backlash. Just a thought.
No comments:
Post a Comment