Electronics manufacturing in Taiwan and Vietnam is going up because of trade war with China

The trade war has had a beneficial effect on some of China’s neighbors, as local manufacturers looked to outsource production and investigate supply chains further afield: according to SC-IQ, Taiwan now has the highest electronics manufacturing growth in the region, averaging 15 per cent in the first three months of the year.

“Looking at US imports of electronic equipment in the first quarter of 2019 versus a year ago gives an indication of the trends,” Bill Jewell, founder of SC-IQ, wrote in a blog post.

“Overall US imports of electronic equipment were $58.8 billion in 1Q 2019, down $2bn or 3.4 per cent from 1Q 2018. Imports from China were down $3.7bn, or 11 per cent. Imports from Mexico held steady at $10.9bn. Vietnam has emerged as the third largest source of US electronics imports, with $4.4bn in 1Q 2019, up $2.2bn or 95 per cent from a year ago.”

Jewell noted several real-world examples of the way the trade dispute has accelerated the growth of electronics production in Vietnam: LG recently moved some of its manufacturing from South Korea to Vietnam; China’s TCL – the world’s third largest producer of TVs – is building a factory in Vietnam; contract manufacturer Key Tronic is set to open a new manufacturing facility in the country in July.

In related news, White House economic adviser Larry Kudlow went on TV on Sunday to state that it was incorrect to claim the the tariffs will be paid by China. He suggested that most of the cost associated with imports into the US will be passed on to American consumers, at least in the short term.

And yet, the Trump administration is working to impose further 25 per cent tariffs on all Chinese goods that haven’t been affected yet – that’s some $300 billion worth of products.

www.theregister.co.uk/2019/05/15/us_china_trade_war/

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