Photo: Wang Song / Xinhua / Globallookpress.com
Pandemic coronavirus and problems in the global economy have forced companies to realize the new threat posed by the practice of transferring their factories to China, writes CNBC.
As noted by the Vice-President of Bain Jerry Mattis, due to the stop of the Chinese economy in the early years the supply chain was disrupted, which led to numerous failures.
Therefore, the main issue for international corporations, he predicted, will increase production sustainability. And this includes the search for new countries and regions to open factories.
According to experts, the immediate decline of production in China is not to be expected, but most of the capacity operating in the export, you can withdraw from the country. To keep the economy growing domestic demand, as satisfactory production of China will keep in any case.
Managing Director of consulting company Alvarez & Marsal Jeet lim confirmed that moving production is a continuous process, and China is still a very attractive place to build factories. However, because of the situation with coronavirus and political pressure for efficiency companies may fall by the wayside.
Last week, the first time China has refused to set targets for GDP growth for the current year. In Beijing, admitted that the pandemic coronavirus forced to take into account a number of factors, whose effects are difficult to predict.
In 2019, China’s GDP grew 6.1 percent is the lowest value in 29 years. One of the main problems is a trade confrontation with the United States. In January the parties signed the first part of a comprehensive deal, but in recent weeks media have reported that Beijing may withdraw from the agreement because it did not receive any benefits. The US is also increasing pressure on China, including tightening the conditions of access to us exchanges for Chinese companies.
Video, photo All from Russia.