The Asean region is set to see more capital inflows as companies look to diversify their investments and supply chains amid US-China tensions in a post-pandemic world, a group of panellists said on the first day of the FutureChina Global Forum on Tuesday.
One leading indicator of the supply chain shift lies in China’s machinery exports to Asean countries as the region ramps up its production capacity, said Tommy Xie, head of Greater China research at OCBC and one of the panellists at a roundtable discussion focused on China-Asean partnership.
In 2019, Vietnam was already the largest recipient of China’s machinery, Mr Xie said. He noted that although foreign direct investment in Vietnam and Indonesia fell by about 50 per cent year-on-year (y-o-y) in the first half of 2020 due to the Covid-19 pandemic, China’s machinery exports to the region remains resilient.
China’s machinery exports to Vietnam grew by 22 per cent y-o-y in the first seven months of 2020, which Mr Xie said was a “very strong” number.
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16 September 2020