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Which ASEAN Country Will Become The World's Next Manufacturing Hub?

Hi there,



My analysis is based on 2012-2013 IMD World Competitive yearbook, a report that is produced annually by the Institute for Management and Development in Switzerland, and presents the competitiveness rankings of 59 eocnomies, including regional economies. In this particuarl ranking schema, the Philippines has ranked highly on par and on year to year basis since 2008. In fact the Philippines ranks highly in labor market at #1, at #11 in fiscal policy and #17 in prices. In fact with growth 6.6-7% this year, the Philippine economy is one of the fastest growing economies in East / Southeast Asia, according to the World Bank. In fact to relegate this importance , Fitsch Ratings had upgraded the Philippines credit rating to BBB+, giving the country its first ever investment grade.

In regards to human potential. The Philippines is blessed with an educated, multi-cultural, bilingual and skilled labor force. The country ranks third among business process outsourcing destinations in terms of annual tertiary graduates as well as graduates in finance and accounting or business and information technology. The fast learning curves, stronger customer service and loyalty and one of the reasons why the Philippines continues to attract foreign investments as a source for manufacturing and processing.

This is why I say that #1 will be Philippines. #2 will be shared between Indonesia and Vietnam.


Regards,
Dr. @Nihonjin1051 , Ph.D, HRM, L.P.
your analysis largely based on human index; labor productivity, and large population. im not saying you wrong however you seem forget other factors are important too as the article points out ; infrastructure, labor cost, accessibility, ease of doing business and govermental.
 
your analysis largely based on human index; labor productivity, and large population. im not saying you wrong however you seem forget other factors are important too as the article points out ; infrastructure, labor cost, accessibility, ease of doing business and govermental.

Predictions are predictions, my friend. Let us agree to disagree, but let us agree on one thing; the top 3 performing countries in ASEAN will be Philippines, Vietnam and Indonesia.

Regards,
 
The world's fourth-largest population at 250 million people, growth in Indonesia's manufacturing sector continues to outstrip the rest of the economy. With the largest population in ASEAN, Indonesia offers competitive labour costs and has the most attractive hourly wage.

Indonesia becomes Isuzu’s third global hub | The Jakarta Post

Indonesia, ASEAN’s largest economy -- is projected to double its consuming class (comprised of middle-class and affluent users) to more than 140 million people by 2020.

Indonesia's current strategy plan to boost Infrastructure development will create an environment where Indonesia can not only emerge as a manufacturing hub, but the abundant natural resources of the Indonesian archipelago can be more efficiently utilised and Indonesia’s cost competitiveness will improve significantly.
 
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Predictions are predictions, my friend. Let us agree to disagree, but let us agree on one thing; the top 3 performing countries in ASEAN will be Philippines, Vietnam and Indonesia.

Regards,
i never predict anything. it article prediction. so there is really nothing for me to agree or disagree witn you. i only points out some of stuffs in article.
 
Productivity%20and%20Labor%20Costs_0.JPG

Filipinas, Filipinas, Filipinas all the way !

Tayo na, Filipina ! Tayo na ! ;)

@Cossack25A1 @Zero_wing @Dakila @WuMaoCleverbot

Hmmm...ang ganda ang Pilipinas, at galing and Pilipino? ;)
 
What do you guys think from this article?

How China's Exclusion From The TPP Could Hurt Its Economic Growth - Fortune

With my opinion, I think China should start running around yelling for help.

"Second, China may become more active in the negotiation of the Regional Comprehensive Economic Partnership (RCEP) within the ASEAN+6 framework, which includes ASEAN, Australia, China, India, Japan, New Zealand and South Korea. Thus far, commentators have been skeptical of this initiative – due in large part to the slow pace of development within ASEAN. Nevertheless, if China considers the RCEP an important instrument to counterbalance the TPP, it may exert greater pressure on its neighbors, or even offer attractive concessions, to ensure the completion of the RCEP negotiations"
 
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1. Thailand
2. Indonesia
3. Vietnam
4. Malaysia

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Alternative answer:
ASEAN don't stand a chance.
China will just move the manufacturing hub to its inland regions.

Sudden factory closures raise fears for Pearl River Delta's electronics manufacturing sector

HE HUIFENGhuifeng.he@scmp.com

PUBLISHED : Tuesday, 13 October, 2015, 11:41pm

33e283fc8ce83fffa02d75eb76020fea.jpg

Protesters outside Kinpo Electronics in Dongguan. Photo: SCMP Pictures

The sudden closures of several factories in the Pearl River Delta after the "golden week" national holiday have fuelled concerns the region's electronics manufacturers are losing out to foreign rivals.

The shutdowns come amid a drop in foreign demand for electronic information products. In addition to the slump in exports, rising costs at factories in Guangdong are prompting companies from Hong Kong, Taiwan and overseas to withdraw from the province and relocate their operations to neighbouring countries.

READ MORE: Manufacturers step up search for low cost alternative to China

A mobile phone factory belonging to Jingchi Plastics in the Fenggang township of Dongguan appears to be the latest victim. On Saturday it announced it was shutting down, leaving debts of 30 million yuan (HK$37 million) to hundreds of suppliers and 80 workers, the Southern Metropolitan Daily reported.

f025ca478c9e7f5811ccf81fb9752fdd.jpg
.
The closing Jingchi Plastics factory. Photo: SCMP Pictures

The owner said he first set up business in Guanlan in Shenzhen before expanding to a factory in Dongguan in 2013 with more than 1,000 workers. "Orders have suddenly gone because of the worsening economic situation. Medium and small enterprises of our kind are finding it very hard to survive," he said.

That closure came just a day after more than 4,000 workers and suppliers turned out in front of the Longgang district government building in Shenzhen to protest against the abrupt closure of Fu Chang Electronic Technology, an electronic parts supplier to domestic telecommunication giants such as Huawei and ZTE.

Founded in 1997, Fu Chang had once been promoted by the local government as an environmentally friendly and innovative factory for precision plastic moulds and injection products.

On October 5, hundreds of workers at Kinpo Electronics, a Taiwanese-invested factory producing printers, clashed with police in the Changan township of Dongguan when their public protest blocked the main road in front of the factory.

Thousands protest in Shenzhen over the closure of FuChang Electronic Technology. Photo: SCMP Pictures


Last month, another plastic hardware supplier in Shenzhen - Hongkaixing - also went out of business.

Orders have suddenly gone because of the worsening economic situation

JINGCHI PLASTICS FACTORY OWNER

Wu Jenn Chang, the chairman of the Enterprises Association of Guangzhou, said at least 30 per cent of Taiwan-invested companies had left Guangdong and moved to neighbouring countries in the past couple of years. The trend was likely to accelerate in the next two years, he warned.

In December, Taiwanese touch screen maker Wintek closed its factories in Dongguan and laid off 7,000 employees.

In February, Japan's Citizen closed its watch parts factory in Guangzhou and let go more than 1,000 workers. Microsoft is to shut its Nokia mobile phone factories in Beijing and Dongguan by the end of the month, laying off about 9,000 employees as it switches its phone manufacturing base to Hanoi, Vietnam.

Sudden factory closures raise fears for Pearl River Delta's electronics manufacturing sector | South China Morning Post

Predictions are predictions, my friend. Let us agree to disagree, but let us agree on one thing; the top 3 performing countries in ASEAN will be Philippines, Vietnam and Indonesia.


Regards,


FDI-Value.jpg
 
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What do you guys think from this article?

How China's Exclusion From The TPP Could Hurt Its Economic Growth - Fortune

With my opinion, I think China should start running around yelling for help.

"Second, China may become more active in the negotiation of the Regional Comprehensive Economic Partnership (RCEP) within the ASEAN+6 framework, which includes ASEAN, Australia, China, India, Japan, New Zealand and South Korea. Thus far, commentators have been skeptical of this initiative – due in large part to the slow pace of development within ASEAN. Nevertheless, if China considers the RCEP an important instrument to counterbalance the TPP, it may exert greater pressure on its neighbors, or even offer attractive concessions, to ensure the completion of the RCEP negotiations"

Is the RCEP still even alive? I barely hear any news on it, just a few sideline talks here and there. Seems like no one is really interested in getting the RCEP finalized.
 
Depend on what you mean by world manufacturing hub and depending on nation.

For example, US foreign investment is mainly in Canada, Mexico and South American nations with very little in East/Southeast Asia. A lot of these countries have much higher wages than both East Asia and Southeast Asia, but US factory tends to go to these places because political inclinations.

Similarly, Chinese fixed capital investment (thus the primary manufacturing assets) are 95% domestic and large portion of the remaining 5% is from Hongkong or Taiwan. So vast majority of Chinese manufacturing will move in land instead outward to other nations.

So ASEAN nations are a lot more likely to receive manufacturing investment from EU and Japan than from China or US, but since the latter two accounts for vast majority of the manufacturing on the planet, the term world manufacturing hub is rather misleading.

Of course when talking about Japan and EU, we also need to take into consideration of domestic retention of businesses. A lot of time the government will give its core business groups rather substantial amount of subsidiaries to retain the business so domestic employment doesn't become an issue.

A common misconception is that the rise of major manufacturing hubs are the result of foreign investment in the area. Sure, if the nation's economy is small enough, then foreign investment can accounts for quite a large share of the pie. However, if we are talking about THE world manufacturing hub, it is pretty much automatically means a very large economy. For these economies, the businesses generating these capacity will instead be largely domestic simply because it isn't enough foreign investment in the world to support that kind of large economy. This is the case with both US and Japan in the past and it is the same case with China now. Also, foreign capitals are notoriously volatile as demonstrated in the 97 financial crisis. It is rather contradictory to world manufacturing hub which implies large term stability in the nation.

Basically, if any ASEAN nation wishes to become a major world manufacturing hub, low-wage and foreign investment are not sufficient to do it because it says nothing about the domestic strength of the nation's economy. Worse still, if the domestic industries are not sufficient developed, sudden in-rush of foreign competitors can be devastating.

At the end of the day, if you want to be best, you have to be strong yourself instead of relying on the mercy of others.
 
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Sudden factory closures raise fears for Pearl River Delta's electronics manufacturing sector

HE HUIFENGhuifeng.he@scmp.com

PUBLISHED : Tuesday, 13 October, 2015, 11:41pm

33e283fc8ce83fffa02d75eb76020fea.jpg

Protesters outside Kinpo Electronics in Dongguan. Photo: SCMP Pictures

The sudden closures of several factories in the Pearl River Delta after the "golden week" national holiday have fuelled concerns the region's electronics manufacturers are losing out to foreign rivals.

The shutdowns come amid a drop in foreign demand for electronic information products. In addition to the slump in exports, rising costs at factories in Guangdong are prompting companies from Hong Kong, Taiwan and overseas to withdraw from the province and relocate their operations to neighbouring countries.

READ MORE: Manufacturers step up search for low cost alternative to China

A mobile phone factory belonging to Jingchi Plastics in the Fenggang township of Dongguan appears to be the latest victim. On Saturday it announced it was shutting down, leaving debts of 30 million yuan (HK$37 million) to hundreds of suppliers and 80 workers, the Southern Metropolitan Daily reported.

f025ca478c9e7f5811ccf81fb9752fdd.jpg
.
The closing Jingchi Plastics factory. Photo: SCMP Pictures

The owner said he first set up business in Guanlan in Shenzhen before expanding to a factory in Dongguan in 2013 with more than 1,000 workers. "Orders have suddenly gone because of the worsening economic situation. Medium and small enterprises of our kind are finding it very hard to survive," he said.

That closure came just a day after more than 4,000 workers and suppliers turned out in front of the Longgang district government building in Shenzhen to protest against the abrupt closure of Fu Chang Electronic Technology, an electronic parts supplier to domestic telecommunication giants such as Huawei and ZTE.

Founded in 1997, Fu Chang had once been promoted by the local government as an environmentally friendly and innovative factory for precision plastic moulds and injection products.

On October 5, hundreds of workers at Kinpo Electronics, a Taiwanese-invested factory producing printers, clashed with police in the Changan township of Dongguan when their public protest blocked the main road in front of the factory.

Thousands protest in Shenzhen over the closure of FuChang Electronic Technology. Photo: SCMP Pictures


Last month, another plastic hardware supplier in Shenzhen - Hongkaixing - also went out of business.

Orders have suddenly gone because of the worsening economic situation

JINGCHI PLASTICS FACTORY OWNER

Wu Jenn Chang, the chairman of the Enterprises Association of Guangzhou, said at least 30 per cent of Taiwan-invested companies had left Guangdong and moved to neighbouring countries in the past couple of years. The trend was likely to accelerate in the next two years, he warned.

In December, Taiwanese touch screen maker Wintek closed its factories in Dongguan and laid off 7,000 employees.

In February, Japan's Citizen closed its watch parts factory in Guangzhou and let go more than 1,000 workers. Microsoft is to shut its Nokia mobile phone factories in Beijing and Dongguan by the end of the month, laying off about 9,000 employees as it switches its phone manufacturing base to Hanoi, Vietnam.

Sudden factory closures raise fears for Pearl River Delta's electronics manufacturing sector | South China Morning Post




FDI-Value.jpg
This sad why no chinese posts this.
 
This sad why no chinese posts this.
CN still have a chance to survive in TPP, they should sell all techs they learned from the West to VN and help VN to establish mutinationals corps.

When VN multis are strong enough, then we will hire those Cnese jobless worker and help them to survive :)
 
Wuhan isnt in west China!!!!
And salary cant be lower than Chengdu and Chongqing,especially Chongqing!!Ya,salary in Dongguan and Yiwu must be highest.(*'Is Shenzhen.much more higher than Shanghai.The statistic in this thread is absolutely wrong. Even Guangzhou is higner than Shanghai.)
And how did the author ignore Tianjin while including Qingdao and Dalian?Where is Wenzhou and Zhuhai?

Why not post pics including 六盘水 and 攀枝花,u will feel happier.
This sad why no chinese posts this.
China is in lack of workers now.
 
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CN still have a chance to survive in TPP, they should sell all techs they learned from the West to VN and help VN to establish mutinationals corps.

When VN multis are strong enough, then we will hire those Cnese jobless worker and help them to survive :)

Hmmm, bro, better to hire the Cambodians first !

This sad why no chinese posts this.

Is the RCEP still even alive? I barely hear any news on it, just a few sideline talks here and there. Seems like no one is really interested in getting the RCEP finalized.

Looks like RCEP has been swept under the rug.
 

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