China’s growing concerns about the resilience of its supply chains and its role in global manufacturing have become more pronounced, reports the South China Morning Post.
In an opinion piece published in the People’s Daily on December 20, China’s Minister of Commerce Wang Wentao wrote that the global supply chain has become fragmented because of the pandemic and Russia’s war in Ukraine, and that a number of countries are trying to “politicize and weaponize” the world economy to push for a decoupling.
Chinese companies must therefore strive to become adept in high-value-added production to stay resilient amid disruptions, Wang said.
U.S. consumer electronics giant Apple is moving to diversify production away from the country amid COVID-19 disruptions and geopolitical tensions. While Wang’s article did not directly mention Apple or any Chinese companies, his call comes as China faces the risk of losing its central role in global supply chains due to the impact of Beijing’s three-year zero-COVID policy, which was only relaxed earlier in December.
The world’s largest iPhone factory, run by Foxconn Technology Group in the central Chinese city of Zhengzhou, has been struggling to keep up with production targets since late October.
Foxconn is planning to move 10 to 30 per cent of its capacity from China to countries including India, Vietnam and Brazil, according to research firm Counterpoint’s analysts Bai Shenghao and Ivan Lam, while its rival Pegatron has also been investing in relatively advanced manufacturing and personnel training in India.
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