Current world events are causing companies to re-examine their manufacturing strategies. They are rethinking where and how they make and source their goods. Many are moving away from having a single-source manufacturing strategy. Companies want to diversify their supply chains and move manufacturing and assembly operations closer to their end markets.
Some countries which have long been considered as simply low wage assembly points, are now flexing new-found muscle in the manufacturing space.
Vietnam
With a population of 96 million, Vietnam has been an economic success story. Since the turmoil of the 1960s, Vietnam has turned itself into a global success story. Economic reforms enacted in 1986 have taken hold and turned one of the world’s poorest nations into a middle-income economy in a single generation. GDP per capita is increasing, and poverty rates are dropping.
The Regional Comprehensive Economic Partnership, of which Vietnam is a member, has formed the world’s largest trading bloc and has recently agreed to lower cross-border tariffs on exports and imports within 20 years, for member nations.
Goods manufactured in Vietnam will be able to move freely across these borders and reach a significant portion of the world’s population. This opens up a whole world of new markets.
If you are interested in exploring these opportunities a firm like Acclime Vietnam or others will be critical to your success.
Thailand
Supply Chain managers are also looking closely at Thailand. With a population of approximately 70 million people, Thailand has quickly developed into a manufacturing powerhouse.
Thailand has low labour costs and very good infrastructure. Good roads and highways, high-speed internet, low-cost housing, great food and a fascinating culture all contribute to making Thailand a great place to do business.
Thailand is a leader in manufacturing electronics, automobiles, and agricultural goods.
The current Thai government appears to be on a recruiting binge to bring more world-class companies to Thailand, including Google and Microsoft.
Malaysia
Malaysia has consistently had one of Southeast Asia’s best-performing economies.
The country is considered to be more developed than many of its neighbours. Malaysia has a very well-developed roadway system and a comprehensive network of air and sea transportation. There are 6 international airports and 7 fully developed seaports, including two that are among the 20 busiest seaports in the world.
Malaysia has a highly skilled workforce and a very high degree of English proficiency. Nearly 50% of Malaysians are literate in English, particularly the young and urban population.
Malaysia has well-developed manufacturing in the following segments.
- Electrical products and electronics
- Machinery and equipment
- Chemicals and petrochemicals
The country is business friendly and the Malaysian government has simplified legal procedures to help support foreign direct investment.
If you are looking at your supply chain, and want to make it more diverse and resilient, Southeast Asia promises some excellent opportunities.
Cost efficiency, customer satisfaction, risk mitigation competitive advantage, and sustainability are all goals of global management.
If these are of interest to you or your company, explore the world of possibilities available in the Southeast Asia region.
