But the desire to look outside China doesn’t mean leaving the country altogether.
Rather than investing more in a Chinese factory, a foreign company may invest more in another country, such as Vietnam, Nick Marro, a Hong Kong-based analyst with The Economist Intelligence Unit, said in a phone interview Friday.
Indeed, a study from the research group found that Vietnam and Malaysia could benefit the most in the long run from a U.S.-China trade war. The two countries have strong infrastructure for supporting distribution, and are well-positioned in the manufacturing of low-end information and technology products and components, the report said.
Thailand also has potential to increase its role as a manufacturing center due to its experience in electronics manufacturing and the government’s efforts to upgrade national infrastructure, the analysis found.
Source: The Economist Intelligence Unit
A spokesperson for the American Chamber of Commerce in Beijing also told CNBC that U.S. companies are staying in China, but they are looking to diversify where their components come from or products are assembled.
Nearly two-thirds of respondents to a survey by the chamber said they are not relocating or considering such a move. Only 13 out of more than 430 companies surveyed are considering leaving China — but rather than choosing the U.S., Southeast Asia is the top destination.
However, companies will likely move slowly. Marro said moving manufacturing operations from China to another country is a process that will realistically take three to five years.
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