The Deglobalisation Myth: How Asia’s supply chains are changing
Global supply chains have continued to expand, despite talk of deglobalisation and nearshoring. Analysing bilateral flows of trade in intermediate goods (IG), we find that global IG exports have grown by 6% a year between 2018 and 2022. Outside of some specific cases such as US-Mexico, regional-shoring is not yet present at the global level.
Asia’s supply chains are changing rapidly. We also find evidence of China’s decoupling – but only with US and Japan. In contrast, China has actually became more important for international supply chain in major Group of 7 economies. Outside the top 3 regional players (China, Japan and Korea), several Asian countries are emerging as “hotspots” of supply-chain trade growth. In particular, Vietnam and Indonesia registered double-digit growth in annual intermediate goods exports during this period.
There are more than one winning formula in this regional reconfiguration process. Economic offering matters and we found three archetypes of hotspot countries.
Also, economies don’t have to choose in this China-US decoupling. In fact, Vietnam and Taiwan became a lot more important for supply chains of both the US and China during this period.
The experts behind the research
Our Macro Consulting team are world leaders in quantitative economic analysis, working with clients around the globe and across sectors to build models, forecast markets and evaluate interventions using state-of-the art techniques. Lead consultant on this project was:
Thang Nguyen-Quoc
Lead Economist, Macro Consulting
Tags:
Recent reports on supply chains
The Economic Impact of SHEIN in the United States
Consulting Report The Deglobalisation Myth: How Asia’s supply chains are changing You might be interested in
Find Out More
Which regions are most exposed to the 25% automotive tariffs?
While the automotive tariffs will likely lead to some production being reshored to US plants, they will also raise costs for US manufacturers and households.
Find Out More
Trump tariff turbulence threatens global industrial landscape
Trump has moved swiftly to advance a trade agenda that goes beyond what was promised in the campaign. This will have a major impact on global industrial prospects.
Find Out More
Blanket tariffs from Trump drag down industrial prospects | Industry Forecast Highlights
The impact of global tariffs, a high degree of policy uncertainty, and higher for longer interest rates are expected to hit industry—we have pushed down our 2025 global industrial production growth forecast by 0.5ppts since our Q4 2024 update.
Find Out More