Electronics manufacturers are gradually leaving China

Recent events in terms of economic disturbances created by mutual sanctions of the US and the Middle Kingdom,

are forcing manufacturers to explore waysretreat, gradual withdrawal from China, since no one wants to be a hostage to various kinds of political conditions. And the point here is not even about the specific company Huawei, the Americans can easily reduce the pressure, the matter, depending on imports from the Middle Kingdom, will weigh on the country’s leadership, even if personnel in China are radically replaced. At the same time, the media is promoting the theme that manufacturers are urgently planning to leave China, it is not profitable for them, they don’t want it at all, but they have been put in this position. Ordinary people, for the most part, take this at face value. However, the situation is completely different.

China becomes more expensive

ESMChina has published an article thatdescribes the economic situation in China, analyzes the average wages of workers and the total income of the population. So, analysts say that the growth of the Chinese economy has long made the country not very attractive, but the neighbors, on the contrary, look more profitable for building important enterprises. In 2018 alone, neighboring Vietnam has managed to attract more than $ 35 billion in foreign direct investment. In the country, about 40 percent of the economy is in the state or part of the state sector, and 60 percent or more is controlled by private traders, the most successful and ambitious of whom are with foreign capital. A plus to the attractiveness of Vietnam is the agreement of the government with 10 countries, which allows to release almost all trade from duties. This top ten includes not only some neighbors, among them Canada, and also Mexico. Vietnam also has preferential duties on duties with the European Union.


Technology companies that openbusiness in Vietnam is fully exempt from any taxes for four years, while the countdown begins only after the company receives the first profit. But even then there are benefits, for the next 9 years they pay taxes half as much as they should be. All components, all equipment that is not produced in Vietnam, can be imported (imported) without duties. And then, if you compare the average wages, in China (and continental), they are already three times higher than in Vietnam. The land is also much cheaper, and all this together clearly defines all the benefits and economic benefits of transferring or opening a new business in this country.

Profitable neighbors

There are others around China that are more profitable.doing business neighbors. In Malaysia, settled enterprises for tests and packaging of processors and other semiconductor products. The world's chip makers Intel, AMD are working in the camp, bringing their processors to the presentation. Of course, there are some nuances, like compulsory creation of a joint venture and division of shares, so that no more than half will remain with foreigners. But some areas in preferential terms, including the field of electronics. They are allowed to keep their shares for themselves. India is just a new discovery for smartphone manufacturers, and there are a lot of Chinese brands here. Here is the company that produces the iPhone.