Vietnam and India see explosion in direct investment from China as tech suppliers shift production overseas, says Goldman Sachs
- Vietnam sees direct investment capital from China jump by 4.6 times to US$1.56 billion during the first five months of the year
- More than 34 listed companies within the Greater China tech supply chain have set up or are building production capacity in Southeast Asia
Vietnam and India have seen an explosive surge of investment from Chinese companies shifting their production capacity abroad as they try to minimise the affects of the trade war, research by Goldman Sachs has found.
“The trade tariffs between the US and China serve as a pressing driver for companies to have part of their production overseas”, said the investment bank’s report issued last Thursday.
Cheap labour and land costs are the main driving force behind relocation of factories, but the threat of trade tariffs has made the push more keen, the report said.
The landscape of the technology supply chain in the Greater China region is changing as companies that make components for smartphones, computers and other high-tech products increasingly move their manufacturing facilities out of China.
More than 34 listed companies within that supply chain have set up or are building production capacity in Southeast Asia, according to the report, which is based on interviews with companies.