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As for Japan, it allocated $ 2.2 billion in early April to help its companies transfer manufacturing operations from China. About $ 2 billion has been allocated to companies that will return production to Japan, with the rest going to companies that will move it to another location.
This came after Japanese Prime Minister Shinzo Abe called in March to return “more complex” production operations to Japan and distribute other production operations in Southeast Asia.
Iris Ohamahama, a manufacturer of consumer goods, will become the first company to receive support when it begins to produce medical masks, including necessary raw materials, in Japan.
Similar plans have yet to be announced in the United States, but Larry Kudlow, a senior economic adviser to the President Donald Trump administration, has announced his support for such a move, in an interview with Fox Business.
“When it comes to the policies of repatriation companies, we can do a lot of things,” he said, suggesting that the United States pay the full cost of companies moving factories, equipment and intellectual property from China to the United States.
It is reported that breaking China’s dependence on the production sector will not be easy, because reorganizing supply chains will be very expensive and because China’s industrial infrastructure is well advanced.
But even before the Corona epidemic appeared, many multinationals were transferring their manufacturing operations from China, due to the continued rise in costs in China.
And the trade war between the United States and China complicates matters for those who export from China to the US consumer market.
However, a large-scale change by companies to move manufacturing operations to their “home” is unlikely. And the “Quartz” website indicated that companies may transfer the production of important products or goods related to national health and security.
But for other products, companies can move them to other less expensive places in Asia or countries close to their main markets.
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In February, closing orders in China climaxed, meaning that many international companies found themselves without factories to produce their products, such as clothing, electronics and others, highlighting China’s global dependence on the field of manufacturing, and the need to take steps to prevent a recurrence of such a scenario in The Future, according to a report by the specialized website Quartz.
To make matters worse, when the “Covid-19” epidemic hit several countries around the world, major countries found themselves in big trouble, when they discovered that they could not manufacture medical equipment and masks locally, because they supported those operations for China long ago. , What has happened. With the United States
To ensure that similar pressure does not drop again, some countries have started offering financial incentives to companies to move manufacturing operations out of China and build more flexible supply chains.
In India, the Prime Minister’s Office is working on a plan that would provide capital-related benefits for manufacturers of electronic and medical devices, so that production moves out of China, either by returning to India or on a basis manufacturing more diversified, taking place in different places.
A government official, who was not identified, told the Indian Economic Times: “Many countries are now interested in having their sectors diversify manufacturing operations sites … There will be a change.”
The Indian government has already started its efforts, as it has contacted more than 100 companies, and is also looking to expand the offer to other sectors, according to the “Quartz” site.
As for Japan, it allocated $ 2.2 billion in early April to help its companies transfer manufacturing operations from China. About $ 2 billion has been allocated to companies that will return production to Japan, with the rest going to companies that will move it to another location.
This came after Japanese Prime Minister Shinzo Abe called in March to return “more complex” production operations to Japan and distribute other production operations in Southeast Asia.
Iris Ohamahama, a manufacturer of consumer goods, will become the first company to receive support when it begins to produce medical masks, including necessary raw materials, in Japan.
Similar plans have yet to be announced in the United States, but Larry Kudlow, a senior economic adviser to the President Donald Trump administration, has announced his support for such a move, in an interview with Fox Business.
“When it comes to the policies of repatriation companies, we can do a lot of things,” he said, suggesting that the United States pay the full cost of companies moving factories, equipment and intellectual property from China to the United States.
It is reported that breaking China’s dependence on the production sector will not be easy, because reorganizing supply chains will be very expensive and because China’s industrial infrastructure is well advanced.
But even before the Corona epidemic appeared, many multinationals were transferring their manufacturing operations from China, due to the continued rise in costs in China.
And the trade war between the United States and China complicates matters for those who export from China to the US consumer market.
However, a large-scale change by companies to move manufacturing operations to their “home” is unlikely. And the “Quartz” website indicated that companies may transfer the production of important products or goods related to national health and security.
But for other products, companies can move them to other less expensive places in Asia or countries close to their main markets.
