Asian Manufacturing

The following is background information on Asian manufacturing in developing economies. This information represents some of the factors that determine where we will manufacture your products.

China is the top manufacturer in the developing world. In 1979, market reforms began in costal regions. Since that time, China has gradually emerged from isolation to become the factory of the world for many products. Although China started with products of low value and quality, it has rapidly improved its infrastructure, manufacturing know-how and skills to become the producer of many high tech products of superior quality and exceptional value.

China’s manufacturing advantages include a large, skilled, disciplined work force, government incentives for both foreign and domestic manufacturing companies, low labor costs and a currency which many consider to be undervalued.
China’s rapid growth has contributed to rising wages and a rising currency. These have reduced some of China’s manufacturing cost advantages. However, China continues to offer considerable cost savings for the manufacture of most products. China entered the World Trade Organization (WTO) in 2001. Since that time, continued market reform and infrastructure improvements have attracted massive foreign investment and improved China’s manufacturing base. China most likely will remain the best place to manufacture many goods for the foreseeable future.

Hong Kong
As Hong Kong becomes more integrated with China, the importance of manufacturing to the Hong Kong economy has decreased. China’s abundant labor attracted a Hong Kong investment boom in south China and beyond and fueled growth in both economies. Production, particularly in labor-intensive industries, has gradually shifted to China. However, Hong Kong has retained some significant light manufacturing in industries such as garments, plastics, electrical and electronic equipment, appliances, metal products, watches, jewelry, and toys.Asian Manufacturing

Hong Kong manufacturers will remain an important bridge to China in the foreseeable future due to their extensive experience in Western business practices, excellent infrastructure and proximity to China.

As its economy has grown and advanced, Taiwan has seen a gradual decline in labor-intensive manufacturing. The mainstay of its manufacturing has shifted to capital and technology-intensive industries, such as chemicals, information technology, electrical equipment, and electronics. Taiwan has become the world’s top manufacturer of many information technology products.

Unlike many of its Asian neighbors, Taiwan’s economy is dominated primarily by small and mid-sized firms. This makes Taiwan very flexible in adapting to market changes.

Although exports have surged in recent years, India’s export-driven manufacturing remains limited in comparison to countries like China due to regulatory, infrastructure and other barriers. Major export products include textiles, jewelry and chemicals. As it works to create a knowledge-based economy, India has become well established in the export of services such as engineering and software.

South Korea
With its rapid economic development and increase in wages, South Korean manufacturing has shifted to high technology and high value-added products. Major export industries now center on electronics, automobiles, machinery, shipbuilding and petrochemicals.

Thailand, Indonesia, Vietnam
Thailand, Indonesia and Vietnam all have emerging manufacturing sectors. Of these Southeast Asian countries, Thailand is the most open to foreign investment and is therefore the most developed with growing exports in clothing, wood products, jewelry, electronics, and consumer appliances.

Indonesia’s major export industries include textiles, food processing, tobacco and timber products with growth in machinery and other sectors.

With its large, low-cost labor force and opening economy, Vietnam has attracted increased foreign investment and has increased its exports, particularly as costs in China rise. Some of Vietnam’s major export products are garments and footwear.

Leave a Reply