India and Vietnam to benefit from supply chain shifts away from China in 2023, study finds
- A survey of global shipping and supply chain industry professionals found that two-thirds of respondents see India and Vietnam as viable alternatives to China
- The Container xChange survey also found that US companies are expected to move more overseas manufacturing to geopolitical allies
According to a new global survey published this week by Container xChange, companies around the world view India and Vietnam as attractive alternative locations to diversify their supply chains from China this year.
Germany’s container logistics platform surveyed more than 2,600 industry professionals from more than 20 countries on shipping and supply chain trends for 2023, finding that 67 percent of respondents believe India and Vietnam will “become functioning hubs for container transport”.
The research comes amid mounting evidence that the two Asian countries are becoming increasingly popular with companies looking to reduce their reliance on China and diversify their supply chain risks.
India’s exports of Apple iPhones from April to December last year nearly doubled from the entire previous fiscal year, while top Indian conglomerate Tata Group is poised to buy a local factory from a Taiwanese manufacturer that will open the country’s first iPhone factory. homegrown, Bloomberg News reported this week.
Meanwhile, Vietnam’s trade surplus with the United States reached an all-time high in 2022, thanks to strong exports of smartphones and other electronic devices, according to customs data released by the Vietnamese government.
The Container xChange survey also found that U.S. companies are expected to move more overseas manufacturing to geopolitical allies, in a move dubbed “friend shoring.” “The aim is to prevent countries, especially China and Russia, from using their market advantages in key commodities, foods and products,” the study said.
For example, US PC giant Dell Technologies has decided to stop using Chinese-made semiconductors next year and will move about half of its production abroad last week, according to Nikkei Asia and Taiwan media.
In addition to supply chain adjustment, inflation and economic recession are seen by 88 percent of survey respondents as the top barriers to their business this year, followed by war, Covid-19 in China and workers’ strikes.
“Europe is being hit hard by consistently high inflation, China is struggling to cope with the virus and the US continues to witness hinterland transportation challenges and labor unrest,” said Christian Roeloffs, co-founder and CEO of Container xChange. “Most of these challenges will remain in 2023.”