A new report by the Asia Business Council, featuring the Asia Manufacturing Diversification Index, assesses the preparedness of ten emerging Asian economies vis-à-vis China in a new world of global trade, as multinational businesses look to adopt “China-plus-one” or even “China-plus-many” strategies in export manufacturing, and intra-Asian trade continues to soar. It offers a strategic roadmap for countries aiming to increase their investment appeal by identifying new growth opportunities and overcoming obstacles in the face of global supply chain shifts and escalating trade tensions.
Asia and the Gulf have deepened their interdependence over the past decade, particularly in energy, trade, investment, and technology. Gulf Cooperation Council (GCC) nations are strengthening ties with Asian countries like China, India, Japan, South Korea, and ASEAN, fostering mutual economic growth. These partnerships are driven by shared goals including economic diversification, energy security, and the advancement of emerging technologies like AI, renewable energy, and electric vehicles. Growing Asian-Gulf ties are strategically important amid global and regional challenges.
Increasingly, new cross-border environmental regulations like the EU’s carbon tax will leave countries such as Bangladesh and Cambodia little choice but to play catch up or risk losing out on global trade. Asian markets can embrace sustainability through artificial intelligence, clean energy investments and more collaboration among industries.
The Philippines, Indonesia, Vietnam, India, and Thailand have benefited from global supply chain diversification and are poised to capitalize on their large labor pool and potential consumer market to reach the next level of development
With Chinese lending to Africa shrinking, the continent must find ways to support its own development. It could do so by increasing internal trade, diversifying tradeable goods away from commodities, and developing its relationship with the U.S.
The US is turning to Vietnam in its attempts to diversify supply chains and curb China’s regional influence, but that is easier said than done. Vietnam’s booming durian exports are just one example of its close economic dependence on China, complicating US ‘friendshoring’ efforts.
Asia’s economic growth and development have been unparalleled over the past 75 years. Poverty has declined continuously and more rapidly than at any time in recorded history, and significant welfare gains have been achieved. These achievements have been driven by Asia’s growing participation in international trade and global value chains, which underpin the globalization process. More broadly, globalization refers to the integration of economies that has been achieved through growing levels of international trade, finance, and investment, and through the mounting exchanges of people, ideas, and data.
