International Law

The politics of manufacturing: China loses its luster

By Andy Scott

By Andy Scott 

Jan. 10 - This past year was China?s year, 2008 may be it again, what with the Beijing Olympics in August, but there is no denying that 2007 was the year of China. Unfortunately, for much of the world, that meant story after story about defective and contaminated products ? from toys and tires to food and medicine. This resulted in increased pressure on multi-national corporations to step up quality control on products sourced in China, set off a giant ?Made in China? scare before the holidays, and, especially in the United States, led to calls for increased diligence and pressure on corporations to justify their China policies. Now, rising prices in China and a politically-charged atmosphere are driving many manufacturers out of China and into places like India and Vietnam.

Last July, Vietnam passed China to become the most attractive destination for foreign direct investment, with FDI topping US$19 billion in 2007, much of that investment coming from the manufacturing and high-tech sectors. U.S., EU and Tawanese manufactures are moving in, with the U.S.-based Jabil Circuit constructing a US$100 million circuit plant in Ho Chi Minh City, the Foxconn group of Taiwan building two plants with a combined capital of US$80 million in Bac Ninh province, Piaggio investing US$45 million in a Vespa motor plant, and Taiwan?s Intelligent Universal dumping US$500 million into a laptop plant in northern Vinh Phuc according to figures released by the Ministry of Planning and Investment. (more…)

Full post as published by China Briefing Blog on January 10, 2008 (boomark / email).