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Fundraising in Vietnam

View of Ho Chi Minh CIty


Fundraising has become increasingly more important for many companies in Vietnam, including everything from non-profits to startups. Being the fastest-growing country in Southeast Asia and with a population of around 98 million, Vietnam is indeed one of the most interesting countries in the region for the purpose of fundraising.

In this article, we review the current state of fundraising in Vietnam, the most common options for fundraising, and success stories in the fundraising market. We review the trends and opportunities, which will give you a better overview of the market.

The Fundraising Landscape in Vietnam

Vietnam has become one of the most promising startup ecosystems in Southeast Asia, with a growing fundraising landscape that continues to attract investors globally. It has almost 3,500 startups as of the moment we write this article, up from just 400 in 2012, which speaks for itself. Thanks to the country’s dynamic and innovative startup scene, a growing number of venture capital firms and angel investors look to invest in promising businesses.

One of the key drivers of the growth is the government’s push to promote entrepreneurship and innovation. Recently, the government has launched several initiatives to support startups, including tax breaks, access to funding, and support for research and development. As a result, we have seen a growing number of incubators and accelerators providing support to early-stage businesses.

Another factor driving the fundraising landscape in Vietnam is the country’s young and tech-savvy population. Vietnam has one of the youngest populations in Southeast Asia, with a median age of just 30 years. This has created a large pool of talent that is well-versed in the latest technologies and trends, making it an attractive destination for investors looking for innovative and forward-thinking startups.

As mentioned, Vietnam’s startup scene has also been boosted by the country’s rapid economic growth. Growing at an average rate of around 6% per year in recent years, and by as much as 8% in 2022, the country has a young and growing middle class that is increasingly looking for new and innovative products and services. This in turn has attracted a growing number of investors looking to capitalize on the trend.

Overall, the fundraising landscape in Vietnam is vibrant and growing, with a range of opportunities available for both startups and investors.

Types of Fundraising in Vietnam

Startups and businesses have access to a handful of fundraising options to secure capital for operations and expansion. The options have unique features that make them suitable for different stages of a company’s growth, and each has its advantages and disadvantages.

Venture Capital

One of the most common fundraising options in Vietnam is venture capital. Venture capital firms provide financing to startups and small businesses in exchange for equity. This option is popular among startups and businesses that are in the early stages of their growth, especially those in the technology sector. Venture capital firms in Vietnam include IDG Ventures, CyberAgent Ventures, and 500 Startups, which have invested in some of Vietnam’s most successful startups, including Tiki, Grab, and VNG.


Another common fundraising option in Vietnam is crowdfunding. Crowdfunding is a method of raising capital through small contributions from a large number of people. This option is ideal for startups and businesses that have a strong community following, such as social enterprises or creative projects. Some popular crowdfunding platforms include Dreamstarter and Fundstart.

Debt Financing

Debt financing is also a popular fundraising option in Vietnam, especially for established businesses with a stable cash flow. In short, this option involves borrowing money from banks or other financial institutions, with an agreement to pay back the loan with interest over an agreed period. While this option can be useful for businesses that need to maintain control over their equity, it also comes with the risk of high interest rates and strict repayment terms.


Initial Public Offerings (IPOs) are another fundraising option in Vietnam, which is suitable for more established companies looking to raise large amounts of capital. In Vietnam, the Ho Chi Minh Stock Exchange and Hanoi Stock Exchange are the two main stock exchanges where companies can list their shares. Some successful companies that have gone public in Vietnam include VietJet Air, Vincom Retail, and Mobile World Group.

Each fundraising option has its unique features that make them suitable for different stages of a company’s growth. For example, venture capital and crowdfunding are popular fundraising options for startups, while debt financing and IPOs are better suited for established businesses. Additionally, each fundraising option has its advantages and disadvantages, and businesses must carefully consider their options before choosing a fundraising strategy that best suits their needs.

Success Stories of Fundraising in Vietnam

Vietnam has been experiencing a remarkable growth in its startup ecosystem, which has led to some inspiring success stories in terms of fundraising. Here are some notable examples of companies that have successfully raised significant capital in Vietnam:

VNG Corporation

VNG Corporation, a leading gaming and messaging company in Vietnam, raised $200 million in its Series B funding round, which was led by a consortium of international investors in 2016. The company, founded in 2004, is one of the pioneers in the Vietnamese startup ecosystem and is now valued at over $1 billion.


Tiki, an online marketplace for books, electronics, and other consumer goods, raised US$275 million in 2021. The company, founded in 2010, has become one of the largest e-commerce players in Vietnam, and the funding round was led by Japanese investment firm, Sumitomo Corporation.


Momo, a leading mobile wallet and payment platform in Vietnam, raised US$200 million in 2021. The funding was led by Warburg Pincus, one of the largest private equity firms in the world. Momo has been instrumental in driving the adoption of mobile payments in Vietnam and is now valued at over $1 billion.


VNPAY, a leading digital payment platform in Vietnam, raised $300 million in a funding round led by SoftBank Vision Fund 2 in 2021. The company has become a key player in Vietnam’s cashless payment ecosystem and has processed over 20 million transactions per month. The funding will be used to expand VNPAY’s services and reach in Vietnam and other Southeast Asian countries.


Sendo, another major e-commerce player in Vietnam, raised US$61 million in its Series C funding round in 2019. Sendo has been growing rapidly since its founding in 2012 and now has over 15 million users in Vietnam.

These success stories demonstrate that Vietnam’s startup ecosystem is capable of attracting significant capital from international investors, and that there are opportunities for growth in a range of sectors, from e-commerce to digital payments. These companies have also contributed to the overall development of Vietnam’s economy, creating jobs and driving innovation.


Fundraising is a growing industry in Vietnam with a range of opportunities available for organizations seeking to secure capital. The country’s thriving startup scene, supported by a government push for entrepreneurship and innovation, is attracting investors globally. With a young and tech-savvy population, a rapidly growing economy, and a conducive environment for startups to thrive, Vietnam has emerged as one of the most promising startup ecosystems in Southeast Asia.

Vietnam’s fundraising landscape offers several options for businesses, including venture capital, crowdfunding, debt financing, and IPOs. Each fundraising option has its unique features that make them suitable for different stages of a company’s growth, and businesses must carefully consider their options before choosing a fundraising strategy that best suits their needs.

Overall, the fundraising landscape in Vietnam presents a wealth of opportunities for organizations looking to raise funds effectively. With the right approach, organizations can leverage Vietnam’s dynamic and innovative startup scene to attract investors and donors and achieve their goals and objectives.

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    How to Find & Verify Suppliers in China

    Shaking hands with a supplier


    Sourcing products in China can be a cost-effective strategy for companies looking to expand their supply chain. However, with the multitude of options available, selecting the right supplier can be a daunting task. In this article, we review the various strategies for identifying suppliers in China, and the importance of evaluating potential suppliers before committing to a partnership.

    Supplier Identification – Options on Hand

    There are a handful of options available when searching for suppliers in China. Below you can find some of the most common options that foreign companies choose.

    Attending trade shows

    Attending trade shows can be successful for manufacturers looking to source products or find new customers in China. They can help you connect with various potential suppliers and provide learning opportunities of industry trends. Additionally, these can help you in establishing personal relationships with suppliers, which can be crucial in business dealings. This is not the case when using online directories unless you visit them on-site.

    On the other hand, attending trade shows in China can also have its disadvantages. These can be expensive to attend, with travel and exhibition costs adding up. Not to forget, the language and cultural barriers can make it challenging to navigate trade shows and communicate effectively with potential suppliers.

    Some examples of trade shows for manufacturers in China include the Canton Fair, the China International Industry Fair, and the China International Machine Tool Show. These trade shows cover a wide range of industries, including electronics, machinery, and textiles. A recommendation is to carefully consider the costs and benefits of attending trade shows in China before deciding to participate.

    Online directories

    B2B online platforms like Alibaba, Made-in-China, and Global Sources have become popular options for companies looking to source products in China. These platforms offer a quick and efficient way to search for products, view supplier profiles, and even place orders online.

    The benefits of using B2B online platforms for sourcing in China include a wide range of suppliers offering diverse products and services, time and cost savings compared to traditional sourcing methods, easy communication between companies and suppliers, and verification and certification of suppliers.

    However, there are also disadvantages of using B2B online platforms for sourcing in China, including limited quality control, language and cultural barriers, competition, lack of personal relationships, and limited customization. You should weigh the pros and cons carefully before deciding to use B2B online platforms for sourcing in China and consider other sourcing strategies.

    Working with sourcing agents

    Companies can find sourcing agents in China through online directories, referrals, or by attending trade shows or networking events. If you decide to work with a sourcing agent, it’s important to conduct due diligence and select a partner that have sufficient experience in your specific industry and product categories offered.

    The benefits of working with sourcing agents in China include their local knowledge and expertise, which can indeed help in navigating the local cultural and business landscape. Additionally, sourcing agents can provide cost savings and efficiencies by leveraging their relationships with suppliers and handling logistics and quality control.

    With that said, there are also disadvantages such as additional costs, reduced control, and potential communication issues if the agent’s English language skills are not strong. You should carefully consider the benefits and disadvantages of working with sourcing agents in China and evaluate whether this approach aligns with their specific needs and requirements.

    Word of mouth

    Word of mouth referrals can also be an effective way to find suppliers in China. Companies can ask their industry contacts, trade associations, or even their competitors for recommendations. Referrals provide valuable insights into the supplier’s reputation, reliability, and quality of products. Companies can also leverage social media platforms, such as LinkedIn, to connect with professionals in the industry who may be able to provide referrals.

    Consulting firms

    Consulting firms can help you to identify suppliers in China by leveraging their experience and expertise locally. By offering end-to-end solutions, they can help with both the supplier identification and evaluation, including:

    Market research: Extensive research on the Chinese market and identify potential suppliers based on their experience and knowledge. This research can include market trends, competitive analysis, supplier capabilities, and pricing information.

    Supplier assessment: Evaluating potential suppliers in terms of their capabilities, quality standards, production capacity, CSR, and other factors that are important to the clients’ businesses. This assessment can help companies make non-biased and informed decisions about which suppliers to work with.

    Supplier verification: Verification of the legitimacy of potential suppliers by conducting site visits, auditing their operations, and verifying their capabilities.

    Negotiation support: Concerning contracts and pricing with suppliers. This can include providing insights into local business practices and cultural nuances that can impact negotiations.

    Supply chain optimization: By identifying opportunities to reduce costs, improve quality, and increase efficiency. This can involve evaluating the entire supply chain from sourcing to delivery and recommending improvements.

    Evaluating the Suppliers

    It’s essential to evaluate the suppliers carefully before committing to a partnership. By conducting a thorough evaluation of potential suppliers, you can ensure that you select a reliable and qualified partner who meet your needs. When evaluating potential suppliers in China, you should consider a range of factors, for example, export experience, quality, corporate social responsibility (CSR), and also soft values.

    Export experience

    Export experience is essential when evaluating suppliers and you should look for suppliers with a solid track record of exporting goods. This will help in demonstrating their knowledge of export procedures, compliance with international trade regulations, and ability to navigate potential language barriers.


    Is another critical consideration when evaluating local suppliers. You should assess the supplier’s quality control measures, including their adherence to industry standards and certifications, such as ISO 9001. It is also essential to inspect the supplier’s facilities and processes to ensure that they meet the company’s quality requirements.

    Corporate social responsibility

    Becomes increasingly important for companies when selecting suppliers in China. Companies should evaluate a supplier’s CSR practices, including their labor conditions, environmental policies, and commitment to ethical sourcing. A supplier with a strong CSR track record is more likely to contribute to a sustainable and ethical supply chain. This becomes increasingly important for end users and governments alike.

    Soft values

    Communication, flexibility, professionalism, and responsiveness are also important to consider when evaluating suppliers. Effective communication is essential for successful collaboration, something that should be confirmed earliest possible.


    In conclusion, sourcing products in China can be a cost-effective strategy for companies looking to expand their supply chain. However, selecting the right supplier can be a daunting task due to the multitude of options available.

    You have several strategies available to identify suppliers in China, including attending trade shows, using online directories, working with sourcing agents, leveraging word of mouth referrals, and by hiring third parties such as consulting firms.

    Once potential suppliers are identified, it’s important to evaluate them thoroughly before committing to a partnership, considering items such as export experience, quality control measures, and corporate social responsibility practices. Ultimately, careful evaluation and selection of suppliers can help companies establish long-term partnerships that contribute to success.

    Overall, identifying and evaluating suppliers in China requires a comprehensive approach, including thorough research, due diligence, and effective communication to overcome the challenges posed by language barriers, cultural differences, and verification processes.

    Read more about our sourcing & supply chain experience or other consulting capabilities.


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      Supply Chain Financing in China

      Consultants discussing supply chain financing


      With the impact of the epidemic, the differentiation of the global supply chain has accelerated. As a business owner, no doubt that you have the nonsystematic risk of delayed deliveries and delayed payments. In 2022, the Chinese government raised attention to encouraging enterprises to improve operational efficiency through supply chain financing.

      In this article, we review supply chain financing and why it has become increasingly important in China. The topics covered are:

      • What is supply chain financing?
      • Improving Financial Liquidity with Supply Chain Financing
      • Reducing Operational Costs in the Supply Chain
      • Legal Service Providers in China for Foreign Companies

      What is supply chain financing?

      Supply chain financing, as an innovative financing option, has developed rapidly in China. It has become an important field for banks, financial information service agencies, and enterprises to expand their service offerings and enhance their competitiveness because of the unreplaceable benefits. Examples include more efficient financing process, lower operation costs, and more reliable cooperations between companies and institutions.

      It provides liquidity for companies promptly and helps each company to conduct business smoothly in international trade. The participants include core enterprises (debtors), financial institutions (creditors), upstream suppliers, and downstream buyers of core enterprises. Sometimes, the creditors can also be core enterprises (non-financial institutions) only if it’s a funding provider in the supply chain.

      Diagram explaining supply chain financing

      Small-and-medium sized companies benefit greatly from supply chain financing as this helps them solve their financing difficulties, which is crucial for their survival. Supply chain financing also improves the competitiveness of small and medium-sized enterprises in terms of high capital liquidity, which attracts many long-term cooperation. For example, the Shandong Provincial Department of Finance encourages small, medium, and micro enterprises to improve the efficiency of accounts receivable financing, and rewards supply chain financing innovation projects with a maximum of 5 million yuan.

      Core enterprises can also act as fund providers for other members in their supply chain members, to improve the overall efficiency.
      This is particularly the case when providing funding for small and medium-sized companies, to support with bank credit and long-term accumulated industry expertise and resources. China’s supply chain finance market has benefited from the increase in the volume of accounts receivable and financing markets. Its scale has expanded by 85.3% in four years, from 11.97 trillion in 2015 to 22.18 trillion in 2019.

      Graph showing supply chain finance market scale

      Graph showing supply chain finance participation rate

      Looking at industries, supplier financing is most commonly used in automotive (59.29%), retail (45%), and steel (43.57%). Taking the automobile industry as an example, commercial banks were the main institutions providing supply chain financing services ten years ago, but now the main providers of financial services are gradually diversifying, including Sino-foreign joint ventures, auto finance companies, and other banks and non-bank financial institutions.

      In addition, the upstream and downstream of the automotive industry are closely connected, and core companies often choose supply chain financing to help repay suppliers quicker and promote the long-term and stable development of supply chain relationships.

      Improving Financial Liquidity with Supply Chain Financing

      In recent years, most international payments and settlements are not pay-as-you-go but adopt a transaction model that separates money from goods such as payment in advance or goods in advance. One settlement way called prepayment or sales on credit becomes popular as of its liquidity benefits.

      According to the statistics of SWIFT (Society for Worldwide Interbank Financial Telecommunications), 80% of international payments and settlements are sales on credit that means after the buyer and the seller sign a goods agreement, the buyer can take the goods without payment, but pays on the specified date according to the agreement or pays in installments. Sales on credit start to stimulate the single order quantity of downstream companies, reduce inventory, and enhance seller competitiveness.

      However, with the continuous development of supply chains, in addition to stimulating sales, sales on credit are also widely used by core companies to optimize their own cash flow. In contrast, traditional bank international trade finance focuses on financing products under traditional settlement methods such as telegraphic transfer (T/T), letters of credit (L/C), and bills, and lacks products based on sales on credit, making supply chain SMEs face increasing financing pressure. Supply chain finance compared to traditional finance is better in terms of liquidity.

      Chart comparing traditional and supply chain finance

      Let’s take accounts receivable financing as an example, suppliers of core enterprises can transfer their accounts receivable to commercial banks, which can generally be divided into those with recourse and those without recourse. Since the commercial bank has already conducted a complete credit rating on the core enterprise, the commercial bank can provide timely payment for the supplier based on the credit facility of the core enterprise, to alleviate the shortage of funds in the entire supply chain and improve company’s financial liquidity.

      Reducing Operational Costs in the Supply Chain

      Supply chain financing saves electronic transaction details in the supply chain IT system within enterprises and uses AI technology and cloud computing automation to complete real-time data collection, analysis, and evaluation.

      It improves the capital turnover rate of enterprises, reduces operating costs, builds a developed, interactive, and information-sharing platform for banks, core enterprises, and upstream and downstream, and promotes the improvement of supply chain operation methods.


      In supply chain finance, the level of information sharing among small and medium-sized suppliers has increased, thereby reducing the workload of banks in related credit review processes such as due diligence. Therefore, each bank will appropriately lower loan interest rates in the process of quoting customers, which will reduce supplier’s financing costs. On the other hand, increased liquidity and continuous production of suppliers have prompted manufacturers to increase orders and revenue.

      Core enterprise (manufacturer)

      Compared with the traditional financing model, the supply chain operating under the supply chain finance model is stable, and the manufacturer can increase additional benefits, such as: reducing out-of-stock costs, increasing customer loyalty, and increasing market share, etc.

      Financial Institutions

      For banks, the qualification review tasks for SME suppliers in supply chain finance are mainly completed by core enterprises, and banks only play the role of review. Therefore, the reduction of review costs and the increase in the number of loans make the overall earnings improve.

      Legal Service Providers in China for Foreign Companies

      Due to China’s strong financial regulatory system, foreign banks are mainly able to provide supply chain financing services for foreign companies in China. The reason is that foreign banks can complete due diligence for foreign companies more efficiently than Chinese local banks.

      Supply chain financing providers in China

      We find that in the above ranking list, many service providers implemented 5G and blockchain technology. For example, DBS is helping companies in the Asia-Pacific region access more affordable working capital globally, using its suite of technologies such as APIs, blockchain, and partnerships with Fintech and e-procurement platforms. Its digital solutions have helped companies of all sizes move to paperless transactions, revealing greater efficiencies and cost savings in their supply chains. Bank of America leverages blockchain technology to bring greater efficiency and transparency to previously opaque paper transactions, which in turn gives the bank the confidence to offer a wider range of financing solutions to customers.


      Supply chain financing has grown rapidly in China for the past few years and as an innovative financing option. It offers advantages such as efficient financing process, lower operation cost, and has since become a crucially important financing option for international banks. While the automobile and steel sector dominated the landscape, sectors around logistics and consumer goods have begun to catch up on the supply chain finance trend.

      Core enterprises can promote the transformation of their internal organizational structure and corporate governance through the development of supply chain financial services, and thus promote the improvement of supply chain management. In addition, companies can look forwards to greatly capitalize on benefits such as improving financial liquidity through sales on credit and using supply chain finance’s real-time data collection methodologies for operational cost reduction.

      Lastly, the management of core enterprises should carefully and carefully analyze the risk characteristics of each link in the supply chain, so that the supply chain management and financial management of the enterprise can promote each other and improve the overall operation ability of the enterprise.

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        Fundraising in China: Opportunities & Challenges

        Discussion over charts showing financial data


        China’s economy has been growing at an impressive rate over the past few decades, and its fundraising landscape has gone through significant changes as a result.

        While the government has historically been the major source of funding for companies in China, there has been a shift towards private investors and venture capital firms in recent years. The country’s venture capital market has grown exponentially over the past decade, with tech startups being the main beneficiaries.

        With that said, fundraising in China can be a complex and challenging process due to the country’s strict regulatory environment and cultural differences, which make it more difficult to navigate compared to many other markets.

        In this article, we review the equity fund raising in China, covering the following topics:

        • The Fundraising Landscape in China
        • Challenges with Equity Fundraising in China
        • Opportunities of Equity Fundraising in China
        • Strategies for Fundraising in China
        • Success Stories of Fundraising in China

        The Fundraising Landscape in China

        China’s fundraising landscape has gone through significant changes in recent years, particularly as the government has been the major source of funding previously. In recent years, we’ve seen a shift towards private investors and venture capital firms.

        The country’s VC market has grown exponentially over the past decade, reaching USD 131 Billion in 2021, with tech startups being the main beneficiaries.

        One of the most significant factors shaping the fundraising landscape in China is the government’s policies and regulations. While the government has historically encouraged investment in high-growth sectors like technology and healthcare, recent regulatory changes have made it more challenging for companies to raise funds through equity financing.

        Despite the challenges, there are still many opportunities for investors seeking to support companies in China with equity to expand. There’s been a surge in the number of startups and early-stage companies seeking investment, particularly in sectors such as fintech, e-commerce, and logistics.

        In addition to traditional venture capital firms, we also see increasingly more angel investors, corporate venture capitalists, and government-backed investment funds that are engaging in the market. These investors bring a diverse range of expertise and resources to the table, making them valuable partners for companies looking to raise funds.

        Worth highlighting is also the emergence of new financing models like crowdfunding and peer-to-peer lending, even if these have faced regulatory challenges in recent years. With that said, they remain attractive options for companies looking to raise funds from a broader range of investors.

        Challenges with Equity Fundraising in China

        Fundraising in China can be a complex and challenging process due to the great regulatory and cultural differences, making it more difficult to navigate compared to many other markets.

        One of the biggest challenges is navigating the regulatory environment as China has strict rules and regulations governing foreign investment, IPOs, and fundraising activities. Companies looking to raise capital in China must therefore be prepared to comply with these regulations, which can be both time-consuming and costly.

        Another notable challenge is the process of building relationships with Chinese investors and venture capitalists, many local investors have different expectations and investment criteria compared to Western countries.

        Building trust and credibility indeed takes time and effort, and companies must be willing to invest in building relationships with local investors and partners, which can be a tedious task. Companies must be willing to invest time and resources in building relationships and communicating effectively with local partners.

        Opportunities of Equity Fundraising in China

        China has a range of promising sectors for investors to consider, primarily in technology, healthcare, consumer goods, renewable energy, and financial services. Let’s take a closer look at some of these sectors.


        Technology is a particularly interesting sector in China, with the country becoming a global leader in areas such as e-commerce, fintech, and artificial intelligence. Companies such as Alibaba, Tencent, and Baidu have achieved impressive growth rates in recent years, and there are many other promising technology startups emerging in China’s innovation hubs.

        As the Chinese government continues to invest in technology infrastructure and innovation, the opportunities for investors in this sector are likely to continue to grow.


        Healthcare is another sector that is experiencing strong growth in China, driven by China’s aging population and rising demand for quality healthcare services. The Chinese government has identified healthcare as a priority area for investment and is implementing policies to encourage private sector participation in the industry. This has led to the emergence of a vibrant healthcare startup ecosystem, with companies focused on areas such as medical devices, digital health, and pharmaceuticals.

        Consumer goods

        The consumer goods sector is also interesting for equity fundraising in China, as the country’s middle class continues to expand and demand for high-quality consumer goods increases. This has led to growth in areas such as premium cosmetics, luxury goods, and high-end food and beverage products.

        The growth of China’s equity fundraising market is being driven by a range of factors, including the country’s strong economic growth, its large and growing consumer market, and its increasingly supportive regulatory environment for private sector investment.

        As China continues to innovate and expand, it is likely that the opportunities for investors will continue to grow as well.

        Strategies for Fundraising in China

        There are several strategies for equity fundraising which can be explored. Below you can find some of the most popular options.

        Initial Public Offering (IPO)

        An IPO is the most common strategy for equity fundraising in China, involving sales of company shares, capital raising, and listing on stock exchanges. China’s stock exchanges, such as the Shanghai Stock Exchange and the Shenzhen Stock Exchange, are among the world’s largest, making them attractive for companies looking to go public.

        Private Equity (PE) and Venture Capital (VC)

        PE and VC firms are a popular source of equity funding for local businesses. These firms provide funding to startups and early-stage companies in exchange for an ownership stake, and provide expertise and guidance to help the businesses grow.

        Secondary Market Financing

        This strategy involves selling shares in the secondary market, which includes exchanges like the National Equities Exchange and Quotations (NEEQ) and OTC Markets. The secondary market provides an alternative to the primary market for companies that may not meet the listing requirements of the stock exchanges.

        Corporate Bonds

        Corporate bonds are a debt financing option for companies seeking capital. In China, corporate bonds are regulated by the China Securities Regulatory Commission (CSRC). Companies can issue bonds on the Shanghai and Shenzhen stock exchanges, as well as on the NEEQ.


        Crowdfunding is a relatively new method of equity fundraising in China. It involves raising capital from a large number of individuals, usually through online platforms. Crowdfunding is popular among startups and early-stage companies that may not have access to traditional sources of funding.

        Success Stories of Fundraising in China

        Many success stories have emerged from China’s fundraising market, including everything from large tech giants to startups. Below are some examples and you might have heard about some of the cases.

        Alibaba Group

        Alibaba Group, one of China’s largest e-commerce companies, went public on the New York Stock Exchange in 2014, raising a record-breaking USD 25 billion. This IPO was the largest in history at the time and set the stage for other Chinese companies to follow suit.

        Tencent Holdings

        Tencent Holdings, a Chinese tech conglomerate, has also enjoyed success in equity fundraising. The company raised USD 5 billion in a bond sale in 2017 and has also invested in many startups and early-stage companies through its venture capital arm.

        Didi Chuxing

        Didi Chuxing, a Chinese ride-hailing company, raised USD 4 billion in a funding round in 2017. The company has also secured investments from major players such as SoftBank and Apple.

        Xiaomi Corporation

        Xiaomi Corporation, a Chinese electronics company, went public on the Hong Kong Stock Exchange in 2018, raising USD 4.7 billion. The company has since expanded into other markets, including India and Europe.


        Pinduoduo, a Chinese e-commerce platform, raised USD 1.6 billion in a funding round in 2018. The company has seen rapid growth in recent years, becoming one of the largest e-commerce platforms in China.

        These success stories highlight the potential for companies to raise significant amounts of capital through equity fundraising in China. While some of these companies have gone public, others have opted for private equity or venture capital funding. Regardless of the strategy, these companies have been able to secure funding and grow their businesses.


        China’s fundraising landscape has evolved considerably in recent years and government funding has largely been overtaken by private investors and venture capital firms. This has resulted in the VC market growing exponentially over the past decade, reaching USD 131 Billion in 2021.

        The government has played a significant role in shaping the fundraising landscape, with regulatory changes making it more challenging for companies to raise funds through equity financing. However, opportunities remain, especially in sectors such as fintech, e-commerce, logistics, healthcare, consumer goods, and renewable energy.

        The biggest challenge in fundraising in China is navigating the regulatory environment, which is complicated due to strict rules and regulations governing foreign investment, IPOs, and fundraising activities. Building relationships with local investors and venture capitalists can also be challenging, given different expectations and investment criteria compared to Western countries.

        Various strategies exist for fundraising in China, including IPOs, private equity and venture capital, secondary market financing, corporate bonds, and crowdfunding. Many successful stories have emerged from China’s fundraising market, including tech giants and startups. As China continues to innovate and expand, opportunities for investors will continue to grow.

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          Electronics Manufacturing & Sourcing in the Philippines: A Comprehensive Guide

          Soldering in an Electronics factory


          Philippines’ electronics manufacturing industry dates to the 1970s when the country’s stable political environment and affordable, English-speaking workforce started to attract multinationals.

          Starting from the assembly of basic chips, the industry has grown to produce advanced components like microprocessors, CD-ROMs, and computers. It became so vital to the country’s economy that companies in the industry established the Semiconductor and Electronics Industries in the Philippines Foundation, Inc. (SEIPI) in 1983 to support its members and promote the industry.

          In this article, we review the electronics industry in the Philippines, what products that can be produced, and the advantages and challenges of sourcing in the country.

          The Electronics Industry in the Philippines

          Together with Malaysia and Vietnam, the Philippines is one of the leading electronics manufacturers in Southeast Asia. Over the past 40 years, the country has welcomed notable industry players, such as Texas Instruments, Toshiba, and ON Semiconductor Corporation.

          The country’s experience in electronics manufacturing has also spurred the growth of domestic Electronics Manufacturing Services (EMS) companies that provide advanced electronic components to the global market across various sectors, including semiconductors, industrial electronics, consumer electronics, and telecommunication equipment.

          The rising tension between the US and China has made the “China + 1” strategy increasingly important for electronics companies. Due to its robust electronics manufacturing base and close relationship with the US, the Philippines is set to become one of the largest beneficiaries of this trend.

          Products Manufactured in the Philippines

          The Philippines is a top global exporter of electronics, with a particular strength in semiconductors. It also excels in producing telecommunication electronics, industrial electronics, and consumer electronics.


          The Philippines stands to benefit from the US-China tensions as semiconductor manufacturers look for other countries to avoid the impact of new restrictive US regulations such as the CHIPS Act.

          In January 2023, the Semiconductor Industry Association (SIA), which represents 99% of the US semiconductor industry, recognized the Philippines’ role in reducing costs for US manufacturers in basic activities such as assembling, testing, and packaging semiconductors.

          With more than 30-40 years of experience working with notable companies such as IMI, Inari Amertrond, and Cirtek, the Philippines is well-placed to provide these services with expertise and quality.

          Industrial Electronics

          Industrial electronics comprise components like drives, sensors, and industrial robotics used in industrial settings. The Philippines boasts notable industrial electronics producers, such as DAC Industrial Electronics and RS Philippines, which provide simple components such as sensors. More advanced and sophisticated products are also being produced such as industrial robots and automation control equipment.

          Telecommunication Equipment

          Between 2011 and 2021, the Philippines’ telecommunication export value increased by 156% from US$ 529 million to US$ 1.35 billion, according to the United Nations Conference on Trade and Development (UNCTAD).

          Telecommunication equipment includes hardware such as routers, cables, and mobile devices. In January 2023, Nokia announced a major investment in the Philippines’ telecommunication sector to create a nationwide broadband network and a 5G network in Metro Manila.

          Consumer Electronics

          Philippines’ largest EMS manufacturers, including Inari and Cirtek, are particularly active in the consumer electronics sector. IMI, the country’s largest EMS manufacturer, is making consumer electronics for electric vehicles (EVs), which could potentially make the Philippines a leading EMS manufacturer for EV consumer electronics.

          Benefits of Sourcing Electronics in the Philippines

          The Philippines’ 40-year record in the electronics sector, skilled and English-speaking workforce, and relatively liberal foreign investment policies offer various benefits for companies seeking to source electronics.

          Skilled workforce

          The Philippines boasts a skilled workforce proficient in the English language, a critical factor for foreign investors. According to the 2022 EF English Proficiency Index, the Philippines ranks second only to Singapore in terms of English skills. This high level of English proficiency facilitates effective communication between staff and employers, enhancing work productivity.

          Additionally, UNESCO data reveals that the Philippines has the third-highest educational attainment rate in Southeast Asia, behind only Singapore and Malaysia, in terms of years of schooling.

          A large workforce at competitive costs

          With a labor force of nearly 50 million, the Philippines possesses the third-largest labor pool in Southeast Asia, following Indonesia and Vietnam. Moreover, the country’s competitive wages are comparable to those of Vietnam, Cambodia, and Indonesia, while also being about 30% lower than that of Malaysia.

          Strategic location

          The Philippines enjoys a strategic location in the Asia-Pacific region, with easy and rapid movement to the most dynamic economic centers worldwide. Major cities such as Tokyo, Beijing, Ho Chi Minh City, Jakarta, Singapore, and Bangkok are all within 10 hours of flight time. Furthermore, the country is positioned between the strategic Malacca Strait, the busiest shipping lane globally, and the US, the world’s largest economy.

          Free trade agreements

          As a member of the Regional Comprehensive Economic Partnership, a free trade bloc comprising ASEAN member states, Australia, China, Japan, South Korea, and New Zealand, the Philippines benefits from free trade agreements in the Asia-Pacific region.

          However, negotiations for an EU-Philippines FTA remain stalled due to the country’s ongoing drug war and its resultant high civilian casualties. Despite this, the absence of an FTA has not hindered the development of significant economic ties between the two sides, with a 2021 total bilateral trade volume of US$ 15 billion, making the Philippines one of the EU’s top 40 trading partners.

          Investment facilitation policies

          The Philippines has enacted investment facilitation policies that will help to reduce bureaucratic procedures in governmental services, including the 2018 Ease of Doing Business and Efficient Government Service Delivery Act. This Act aims to decrease the time businesses must spend on administrative tasks while increasing transparency within governmental departments and companies.

          Moreover, since 2021, the Philippines has allowed 100% foreign ownership in public services such as telecommunications, airlines, shipping, and railways, making it one of the few countries in the world to do so. However, ownership restrictions still exist in areas such as ports, electricity, and water distribution.

          The Philippines’ relatively lenient foreign ownership policies and efforts to reduce red tape are highly advantageous for foreign investors seeking entry into the country’s electronics market. With a skilled workforce, a large and affordable labor pool, and an advantageous location, the Philippines presents significant investment opportunities.

          Challenges in Sourcing Electronics from the Philippines

          While the Philippines offers many advantages as a sourcing destination for electronics, there are also some challenges that must be taken into account by potential investors. These include issues with infrastructure, corruption, and dependence on China.


          Former President Duterte initiated an ambitious “Build, Build, Build” infrastructure program in 2017. The program has cost about 7.3% of the country’s GDP in 2022 or an average of US$ 32.8 billion every year from 2017 to 2022.

          Despite so massive a program, only 10% of the projects were completed by the end of Duterte’s presidency in 2022. In addition, although the Philippines has an extensive network of seaports, they are small in size. The Philippines’ largest Port of Manila is only ranked 31st by the World Shipping Council, behind countries such as Vietnam, Malaysia, and Indonesia. Furthermore, according to a survey from the World Economic Forum, the Philippines ranks as the third worst in terms of road connectivity in Southeast Asia.

          The low port capacity and road connectivity mean that it will be challenging to move goods from factories to export ports rapidly.


          The Philippines ranks as the fourth most corrupt country in Southeast Asia, according to the Corruption Perception Index by Transparency International. The Bureau of Customs, a crucial governmental organ for many foreign investors, is perceived as one of the most corrupt by the US State Department. High levels of corruption pose a significant challenge for foreign investors in the country.

          Dependence on China

          Despite being one of Southeast Asia’s major manufacturing hubs of electronics, the Philippines still relies heavily on China for sub-components and raw materials such as integrated circuits and petroleum. This trend, however, has not shown any sign of abating, between 2021 and 2022, the Philippines’ electronics imports grew by 14.5%.

          According to a 2019 report by the Electronic Engineering Times, the Philippines’ electronics contain about 80% sourced from abroad. These two factors make the Philippines’ electronics industry highly reliant on Chinese sources.

          Semiconductor and Electronics Companies in the Philippines

          The semiconductor and electronics industry plays a significant part of the country’s economy and is a vital component of the global supply chain. This industry offers a wide range of services, from design to distribution, and has attracted many foreign investors due to its affordable, English-speaking, and qualified workforce.

          In particular, the top EMS companies in the Philippines are highly desirable due to their extensive experience in EMS manufacturing and their willingness to modernize their production systems to meet the growing demand for cutting-edge products like electric vehicles (EVs).


          One of these leading EMS providers is IMI, which has been in operation since 1980 and has manufacturing, engineering, and sales facilities in ten countries worldwide. The company has focused its strategy on developing EV-related products, such as automotive cameras, EV charging stations, and power systems.

          Cirtek Electronics

          Another top player in the Philippine electronics manufacturing sector is Cirtek Electronics, which has been able to adapt to the ever-changing demands of customers since its inception in 1984. The company offers a wide range of products and services, from components for telecommunication devices to assembly, testing, and repair.

          Inari Amertron

          Finally, Inari Amertron, a result of an acquisition by a Malaysian company, has two major plants in the Philippines and is set to become one of the most cutting-edge EMS providers in the industry by leveraging Fourth Industrial Revolution technologies like the Internet of Things and machine learning.


          Despite the advantages of investing in the Philippine electronics industry, there are still significant challenges to consider, such as the country’s reliance on China for sub-components and raw materials, high corruption, and inadequate infrastructure. Addressing these issues will be crucial to fully harness the potential of the country’s electronics manufacturing sector.

          In conclusion, the Philippines has the potential to become a dominant player in the EMS industry. However, to realize this potential, it is essential to focus on improving infrastructure, reducing dependence on China, and addressing corruption to create a more conducive business environment for investors.

          Read more about our sourcing & supply chain experience or our other consulting services.


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            Market Entry & Expansion in Indonesia: Key Insights & Market Trends

            Jakarta at night


            Indonesia, the largest economy in Southeast Asia, has experienced a steady economic growth of around 5% per year for the past decade. The country boasts abundant natural resources, a large domestic market with increasing purchasing power, and a young population.

            With a population of over 275 million, Indonesia represents more than one-third of ASEAN’s population, making it the most populous country in the region. As the largest economy in the region, Indonesia’s economy accounts for more than one third of ASEAN’s gross domestic product (GDP), which is estimated to be around USD 1.18 trillion in 2022. This potential has made Indonesia a likely candidate to become the ASEAN hub in the coming years. PwC projects that Indonesia will become the fourth largest economy in the world in 2050, behind China, India, and the US.

            Public investment in infrastructure and friendly policy measures for a better private investment climate are the key factors driving the country’s economy. The government has implemented some reforms, including liberalizing some trade measures, cutting fuel subsidies, and improving tax compliance to free up funds for infrastructure development.

            Private consumption is one of the main driving forces of Indonesia’s economy, with all economic activities predominantly directed at the domestic market. In 2022, private consumption reached 51.87% of GDP, and historically, the average contribution of private consumption has been 59.1%. In most of 2022, the central bank (Bank Indonesia) maintained low interest rates, which helped maintain a robust growth rate in household consumption.

            Table showing key indicators of the Indonesian economy

            Indonesia’s Consumer Market

            With the fourth largest population globally and a growing middle class, Indonesia is an attractive destination for businesses looking to expand. Major brands in consumer goods have already established their business activities in Indonesia, and the society’s fascination with branded goods has increased business potential in the market. For instance, IKEA established its business in 2014 with one store, and within a year of opening, the company managed to sell 12 million products. Since 2019, the company has opened four more stores in the country.

            The fast-moving consumer goods (FMCG) sector is a significant contributor to Indonesia’s economic growth. The primary growth factors in the industry are growing consumer spending power due to increased personal income and growing urbanization.

            On average, Indonesian families spend about 20% of their entire household spending on FMCG items, with the food segment making a major contribution. The sector was the least impacted during Covid-19, and most major multi-national companies (MNCs) have established their presence directly in the country to take advantage of the benefits offered by the consumer market.

            How the Pandemic Affected Consumer Behaviors

            The pandemic shifted consumer behavior and increased the use of digital technology in daily life. Data traffic, e-learning, digital payments, e-government, and e-commerce have all experienced increased demand. Between 2020 and 2021, the increase in mobile connections was almost in line with the growth of the population, with an additional 27 million internet users covering 73.7% of the country’s population. Covid-19 has accelerated the adaptation of ICT by the large base of dynamic, young, and digitally minded workforce and consumer base.

            Health and hygiene products have seen a surge in demand as people become more conscious of their health and safety. Besides, e-commerce has become the preferred way to shop as consumers prioritize convenience and safety. Not to forget, online grocery channels have seen a significant rise as people avoid crowded places. Finally, with people spending more time at home due to the pandemic, home entertainment has become more popular.

            While some changes have reverted due to the easing of COVID-19 restrictions and the return to normal activities, e-commerce and online grocery channels have maintained their strong position. Indonesia’s e-commerce market is one of the largest in the world, ranked 10th globally, and will rank 4th by 2030. According to the latest study, the compound annual growth rate for e-commerce in Indonesia is projected to be 10.4% during the medium term (2023-2027), with a projected market volume of USD 75.75 billion in 2027.

            Chart showing revenue growth of ecommerce in Indonesia

            The Indonesian B2B Market

            According to the Indonesian Central Statistics Agency (BPS), the manufacturing sector had the highest share of the GDP in 2022, accounting for 18.34%, followed by the mining sector with 12.22%.

            Within the manufacturing industry, subsectors such as food and beverage, chemical, transportation equipment, and metal goods including computers and electrical equipment were deemed important. The retail sector contributed 12.85% of the GDP, while Agriculture, Forestry, and Fisheries made up 12.40%. These sectors are considered vital to the country’s economy.

            In 2018, Indonesia initiated the Making Indonesia 4.0 program, aimed at revitalizing the manufacturing industry through the adoption of Industrial Revolution 4.0. This initiative provides great potential for the country to increase labor productivity, boost global competitiveness, and increase its share of the global export market. The government’s targets include becoming a global top 10 economy by 2030, doubling the productivity-to-cost ratio, pushing net exports to 10% of GDP, and allocating 2% of GDP for research and development.

            To achieve these objectives, the government is developing five major manufacturing industries: food and beverage, textiles and apparel, automotive, electronics, and chemicals, as they are among the most competitive industries in the region. These five industries contribute 60% of the manufacturing GDP, 65% of export-manufacturing, and employ 60% of the manufacturing workforce.

            Some of the steps taken to achieve these targets include reforming the flow of goods and materials, embracing global sustainability trends, empowering SMEs, building nationwide infrastructure, attracting foreign investments, establishing an innovation ecosystem, incentivizing technological investment, and re-optimizing regulations.

            Indonesia’s Net Zero Emission Targets

            With the Net Zero Emission 2060 initiative becoming a long-term program from the government, strategic industries such as power, oil and gas, and mining have intensified their efforts to invest in technology. These industries are also controlled by the government through the presence of state-owned enterprises. Private companies are also seeking suitable technology to meet potential demand when carbon trading is implemented in the near future.

            The country’s greenhouse (GHG) gas emissions reduction target is 29% unconditionally and 41% conditionally (with international support) by 2030, with renewable energy and energy efficiency being the primary measures to achieve these targets. The year 2030 will serve as the baseline for reviewing the country’s progress towards achieving Net Zero Emission by 2060.

            B2B e-commerce has also witnessed remarkable growth in recent years, with the Indonesian B2B e-commerce market valued at USD 51.43 billion in 2021, registering a CAGR of 7% during 2015-2020. The B2B e-commerce market serves as a procurement channel for some companies and a marketing channel for micro, small, and medium enterprises (MSMEs).

            Market Entry Strategy

            To be successful in Indonesia, the presence of a local partner is highly important, it’s imperative to identify a local company that can represent your brand to targeted industries. The understanding of Indonesian culture, applicable regulations, and local consumer preferences are key factors to build the a successful business.

            Market research

            Expanding a business into a new market can be an exciting but challenging endeavor. When entering Indonesia, a local partner is critical to success, as they can represent the brand to the targeted industries and navigate local regulations and consumer preferences. Building a solid understanding of Indonesian culture and conducting thorough market research are essential factors to consider before making any decisions.

            Conducting Market Research

            Pricing, financing, technical skills, and after-sales service are just a few of the critical factors that impact purchasing decisions in Indonesia. Gathering insights on these factors requires a comprehensive market research approach to better understand the target audience, competitors, marketing channels, cultural differences, and potential growth. With the right data, a company can build an effective market entry strategy that considers all relevant aspects of the market.

            Working with Agents and Distributors

            When selecting a local distributor or agent, it’s essential to find a reliable partner that possesses a distributor’s license and has a thorough understanding of doing business in Indonesia. The right distribution partner should be able to provide support in navigating importation procedures and customs clearance, and also help expand sales within the country.

            It’s important to differentiate between agents and distributors, as an agent represents the foreign principal, while a distributor acts for itself in marketing and selling the principal’s goods and services. Once an agreement is made between the foreign principal and the local distributor or agent, the agency/distributorship agreement and a statement letter from the Attaché of Trade of the Indonesian Diplomatic Representation in the principal’s country of origin must be submitted to the Ministry of Trade.

            Selling Online or Offline

            To market and promote products to the right audience, a local agent or distributor is crucial. They must introduce the products to key companies/segments and register them in advance of marketing. Some products, such as food and beverage and healthcare equipment, require registration before promotion and marketing. It is the local partner’s primary responsibility to introduce the brands and obtain initial recognition.

            For B2B markets, e-procurement has been widely accepted to ensure transparency, efficiency, and accountability in the procurement of goods/services through electronic media. A good supply history with companies from similar industries in Indonesia or other ASEAN countries will increase the chance of being considered by targeted companies.

            In recent years, e-commerce has also become an effective way to introduce and market products to a broader consumer class. Indonesia has the largest number of digital consumers in Southeast Asia, and post-pandemic, digital consumer demands have evolved significantly. While online channels are essential for product discovery and promotion, offline channels remain vital for the purchase stage, providing users with a better experience and feel of the products before completing the purchase.

            Setting Up a Company in Indonesia

            Setting up a branch or subsidiary is an effective way to enter the market. However, it is important to note that certain capital needs to be invested to establish a legal presence.

            One of the most effective ways to establish a legal presence in Indonesia is to set up a Foreign Company Representative Office. This method is easier than setting up a limited liability company. However, it is essential to note the main differences between a Foreign Company Representative Office and a Foreign Investment Company.

            Foreign company representative office

            Is only allowed to supervise, liaise, coordinate, manage, and act as an intermediary for the foreign company’s business interests in Indonesia. The representative is not allowed to participate in managing a foreign company’s operations in Indonesia, generate any revenue in the country, and engage in any agreement or transaction for the sale or purchase of goods and services with an Indonesian company or Indonesian national. As such, the main foreign company is the only one through which all transactions can be handled.

            Foreign investment company

            Is described as investing activities to conduct business in the territory of Indonesia carried out by foreign investors, either using fully foreign capital or joint ventures with domestic investors. Foreign investors can only carry out business activities in large businesses, and the investment value should not be less than ± USD 670,000 (equals to IDR 10 Billion).

            Market Entry Barriers

            The Omnibus law bill established in 2020 aims to improve a conducive and attractive business climate for investors in Indonesia. However, some challenges still exist, such as labor relations, intellectual property protection, transparent rules setting and implementation, standards and certification, and pricing.

            A study by TMF Group in 2021 mentioned that Indonesia was in the 6th position of Global Business Complexity Index. However, it has improved from the result in 2019 when the country ranked number 1. Thus, it is essential to conduct thorough market research before entering the Indonesian market

            Product Standards and Labeling Requirements in Indonesia

            In Indonesia, product standards and labeling requirements are in place to ensure the safety and quality of goods sold in the country. It’s important to understand these regulations before entering the Indonesian market.

            Product Standards

            Indonesia National Standard (Sertifikat Nasional Indonesia/SNI) is the only product standard required for 119 product categories. The list of products can be found here. The list has expanded much recently, and it’s advised to consult with a third-party for up-to-date information.

            Labeling Requirements

            All products sold in Indonesia are required to follow the latest labeling requirements. Every business actor use or complete Indonesian language labels on goods traded domestically. Certain products, such as food, beverages, and cosmetics, have higher labeling requirements since they need to be registered first in the Drug and Food Supervisory Body (Badan Pengawas Obat dan Makanan).

            1. Labels must be in clear, easy-to-read, and easy-to-understand Indonesian language (Bahasa Indonesia).
            2. If the language is not available or its equivalent cannot be created, Arabic numerals and Latin letters may be used.
            3. The identities of business actors, including at least the names and addresses of producers (for goods of domestic origin), importers (for goods of imported origin), packagers (for goods of domestic origin or of import which are packaged in Indonesia), or collecting traders must be included if they acquire and trade goods produced by micro and small businesses.
            4. The label must contain information on the name of goods, origin of goods, and the identity of the seller, at least containing the name and address of the producer (for goods produced in the country), importer (for goods of imported origin), packers (for goods produced domestically or of imported origin packaged in Indonesia), or collecting traders if obtaining and trading goods produced by micro and small businesses.
            5. Other information according to the characteristics of the goods must be included.
            6. Information or explanation in accordance with the laws and regulations must be provided.
            7. Goods related to the safety, security, and health of consumers and the environment must contain clear and easy-to-understand instructions for use and hazard symbols and/or warning signs.
            8. For goods that have mandatory Indonesia National Standard, the affixation of Indonesian language label shall follow the marking which is determined in Indonesia National Standard.

            Import Tariffs

            All taxable goods imported into Indonesia are subject to a 7.5% import duty and a 10% value-added tax. Due to the latest regulation in the country, importers now only have to pay 17.5% (previously, 27%) for taxable items. In the past, importers also needed to pay income tax of 10%.

            Indonesia is taking part in various Free Trade Agreements. Here’s the list:

            1. ASEAN Trade In Goods Agreement(ATIGA)
            2. ASEAN-China Free Trade Area(ACFTA)
            3. ASEAN-Korea Free Trade Area(AKFTA)
            4. Indonesia-Japan Economic Partnership Agreement(IJEPA)
            5. ASEAN-India Free Trade Area(AIFTA)
            6. ASEAN-Australia-New Zealand Free Trade Area(AANZFTA)
            7. Indonesia-Pakistan Preferential Trade Agreement(IPPTA)
            8. ASEAN-Japan Comprehensive Economic Partnership(AJCEP)

            Challenges of doing business in Indonesia

            Indonesia’s government sees investment as a crucial driver of the country’s development. The Positive Investment List, issued in 2021, now enlists sectors open to 100% foreign investment, replacing the Negative Investment List that previously identified closed or restricted fields. The law now categorizes business lines into four types of foreign investment allowance:

            1. Priority sectors
            2. Fields with some restrictions
            3. Fields that require a partnership with Micro, Small, and Medium-sized Enterprises (MSMEs), and
            4. Fields completely closed to foreign investment.

            Despite Indonesia’s attractive market potential, businesses must navigate certain challenges to effectively operate within the country. One of the most significant challenges is meeting the Local Content Requirements (LCR), which originated in the oil and gas sector but now applies to a broad range of economic sectors. Foreign companies must now source more than 75% of inputs for projects locally, presenting potential obstacles to their operations. However, those who see this requirement as an opportunity to promote their business will enjoy preferential treatment in tenders, particularly those initiated by state-owned enterprises.

            Another key consideration for businesses supplying certain products, such as food and beverages, pharmaceuticals, cosmetics, chemical products, genetically modified products, biological products, etc., is obtaining a Halal certificate. This is necessary to ensure that products meet the religious standards of Indonesia’s predominantly Muslim population.

            To effectively operate in Indonesia, companies must also address language and cultural barriers that can hinder effective communication and understanding of targeted industries. Though the business landscape can be complex, Asia Perspective offers expert assistance in navigating the terrain to help companies enter the market with their key solutions.


            Indonesia boasts the largest population in Southeast Asia and boasts stable economic growth, making it a highly attractive market for international companies looking to expand their operations. The country’s growing economy, demographic bonus, rising middle class, and strong manufacturing capabilities all make it an attractive proposition for businesses looking to tap into its potential.

            However, it’s important to note that doing business in Indonesia can come with its own set of challenges. One of the initial barriers is the language and cultural differences, which can make it difficult to understand the country and targeted industries.

            As mentioned, there are several challenges and barriers that companies may face, which should be carefully considered. Navigating the entire landscape can be both capital and time-intensive, and assistance from a third-party is often required.

            Read more about our market entry & expansion experience or other consulting capabilities.


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              Sourcing & Manufacturing in India: An Introduction

              Machinist working in Indian factory

              Companies are increasingly shifting their focus from China to other Asian markets for sourcing and manufacturing of products. India gets some of the most attention and will play an important role in acting as a complement to Chinese manufacturing in the future.

              In this article, we take a deeper look into the Indian manufacturing landscape, covering topics such as the advantages of choosing India, the disadvantages, what products that can be manufactured, and more.

              India Overview:

              • Population: Around 1.4 billion
              • Capital: New Delhi
              • Bordering countries: Afghanistan, Bangladesh, Bhutan, China, Maldives, Myanmar, Nepal, Pakistan, Sri Lanka
              • Major cities: New Delhi, Mumbai, Bangalore, Kolkata, Chennai, Hyderabad, Ahmedabad

              Advantages of Manufacturing in India

              India has many advantages for sourcing, particularly as companies increasingly adopt China plus-one strategies to diversify manufacturing. This is something that Southeast Asia will benefit from greatly as well. Let’s review some of the greatest advantages of choosing India as a sourcing market.

              Young and English-speaking workforce

              Approximately 65% of the population in India is below the age of 35. At the same time, the share of the young working population in the total population is increasing.

              This abundant young workforce can boost Indian manufacturing over the next two to three decades, fostering India to achieve its full manufacturing potential.

              Furthermore, India has long been claimed as the world’s second-largest English-speaking country, making communication easier compared to countries like China and Vietnam.

              Low labor costs

              India has significantly lower labor costs compared to China. This enables businesses to gain access to a large pool of talent at highly competitive costs.

              India also has a cost advantage for manufacturing wages, particularly for trained blue-collar workers, according to Asia Perspective’s research and database from 2021-2022. As shown in the chart below, India has an edge over the Southeast Asian countries of Malaysia, Thailand, Indonesia, and Vietnam.

              Graph showing Manufacturing gross salaries in Asian countries

              Manufacturing capabilities

              One of the biggest advantages of choosing India is its design and manufacturing capabilities, which makes it more appealing for companies looking for an end-to-end manufacturing solution. Rather than countries who only focuses on midstream manufacturing activities.

              A wide range of products can be produced in a multitude of industries, with some of the more notable industries being:

              Chemicals: including bulk chemicals, specialty chemicals, petrochemicals, agrochemicals, polymers, and fertilizers

              Pharmaceuticals: such as OTC medicines, Generics, APIs, Vaccines, and Biosimilars

              Automotive: including spare parts and components

              Electronics: including mobile phones, IT hardware such as laptops and tablets, consumer electronics TV and audio, industrial electronics, and automotive electronics

              Industrial machinery: including equipment for heating, ventilation, air conditioning, and machine tools

              Textiles: from the production of raw materials to the delivery of finished products

              Another notable advantage of manufacturing in India is the abundance of high-quality equipment.

              Improved economic environment

              The Indian government’s policies have been increasingly supportive of businesses that want to source in India, presenting them with a greater sourcing opportunity.

              In 2021 and 2022, we saw significantly more support from Indian authorities aiming at the country’s manufacturing sector, especially in key manufacturing industries such as automotive, chemicals, and electronic components.

              For example, through the Production-Linked Incentive (PLI) scheme, the Indian government intends to build global manufacturing champions across 13 industries and has earmarked US$ 27.13 billion for five years starting from 2022. Regarding the semiconductor manufacturing industry, the PLI is set at $9.71 billion, with the goal of putting India as a prominent manufacturer of this critical component.

              Besides that, the Indian government authorized a PLI scheme worth US$ 2.47 billion in May 2021 for the development of advanced chemical cell (ACC) batteries, which is anticipated to attract US$ 6.18 billion in investments, increase capacity in core component technologies, and position India as a global clean energy powerhouse. In September 2021, the government approved a PLI scheme worth US$ 3.53 billion for the automotive & drone industry.

              Some notable government initiatives encouraging the manufacturing and industrial sectors are listed in the table below:

              Table showing India's industrial and manufacturing initiatives

              Increased domestic demand

              India has a growing middle class, which makes it a desirable consumer market. The Indian middle class is expected to account for 17% of global spending by 2030, ranking second globally, which speaks for itself.

              The Indian market for appliances and consumer electronics (ACE) is predicted to increase to US$ 21.18 billion by 2025, up from US$ 10.93 billion in 2019.

              According to a report published by NITI Aayog and RMI India, India’s electric vehicle financing sector is expected to reach US$ 50 billion by 2030.

              Disadvantages of Manufacturing in India

              Despite India’s manufacturing-related advantages, the country faces many challenges, particularly as it seeks to become a global manufacturing hub and capitalize on China-plus-one strategies.

              Inadequate infrastructure

              Despite improvements, India’s ill-adapted infrastructure, including roads, railroads, airports, seaports, electricity grids, and telecommunications, poses obstacles to the country’s expanding economic status and ability to perform public services.

              Telecom communication facilities are primarily concentrated in major cities. Most of the State Electricity Boards are losing money and are in disrepair.

              Despite being surrounded by water and having manufacturing centers both close to the coast and in the hinterlands, India’s manufacturing is impeded by weak marine infrastructure. Few Indian cities have established facilities for swift entry and exit, while trucks continue to queue at the border of Mumbai, India’s largest port. Even in Kolkata, India’s largest metropolis and one of the world’s largest cities, traffic limitations on a small stretch of road exert a negative impact on port operations.

              The transportation challenges do not end with the ports. Because most overbridges and flyovers are designed to accommodate passengers, the practicality of double-stacked containers and cargo transit along rivers should also be called into question.

              Many causes, such as significant population expansion, expanding urbanization, and rising wages put pressure on the government to invest in the country’s infrastructure. As a result, the government is allocating significant funds to infrastructure initiatives. This paints a hopeful picture of a new India with better-equipped infrastructure.

              Complex regulations & laws

              The manufacturing sector in India is subject to a plethora of complex laws, related to licensing, tenders, and audits, which can be burdensome for enterprises and stifle their growth.

              Cumbersome manufacturing-related legislations in India are the labor laws. The laws are extremely intricate since they vary depending on the number of workers.

              For instance, the Industrial Disputes Act (ID Act), which specifically states that an employer is generally required to retrench the worker who was the last individual to be employed in a specific category when dismissing workers. Furthermore, additional requirements apply to factories such as a factory with a headcount of more than 100 must obtain prior permission from the appropriate authorities before laying off workers. Besides, and these workers must be granted a three months’ notice (or pay in lieu of notice) as well as Retrenchment Compensation.

              As a result, investors are generally hesitant to invest in this area. Consequently, many Indian firms remain relatively small.

              Labor is on the concurrent list, and the subject is governed by more than 40 central laws and more than 100 state laws. Fortunately, the central government is eager to unify the central law codes governing wages, industrial relations, social security and welfare, and occupational safety, health, and working conditions. This probably results in reforms to ensure the ease of doing business.

              Reliance on imports

              India is still dependent on imports for transport equipment, machinery (electrical and non-electrical), iron and steel, paper, chemicals and fertilizers, and plastic materials.

              As an example, consider the pharmaceutical business, which is one of the most vital and lucrative industries in India. Being a major producer of pharmaceutical products, India relies significantly on China for active pharmaceutical ingredients (APIs), the material that creates the desired effect of the medicine. It is also overly reliant on China for key starting materials (KSMs), which are the raw components used to manufacture APIs.

              Energy requirements are another example of India’s heavy reliance on imports. Currently, around 86% of India’s crude oil requirements must be imported, with nearly a quarter of this supply coming from Russia.

              What products can be manufactured in India?

              India has several industries that generate a wide range of products. The three industries listed below are commonly regarded as India’s top three manufacturing ones.


              Electronic device demand is predicted to grow steadily and remain a significant economic driver internationally. The Indian electronics industry is one of the world’s fastest-growing ones, making the country appealing as a sourcing site for electronics items. India pioneered the Local Goes Global movement.

              In the electronics export industry, India is focusing on increasing its global value chain share, establishing export hubs in many states, constructing a high-quality and seamless supply chain, and raising its overall market share.

              Graph showing India's electronics exports

              The Government of India aspires to make India a prominent manufacturing and design base for electronics as part of its Aatmanirbhar Bharat plan. India’s market share in the global electronics manufacturing industry increased from 1.3% in 2012 to 3.6% in 2020. The Indian electronics industry is on an upward trajectory, and the government has set short- and long-term goals to make India a center for electronics exports and manufacturing.

              Smartphone manufacturing is an outstanding category of Indian electronics manufacturing because India is one of the world’s largest mobile handset manufacturing countries and the world’s second-largest smartphone market.

              Furthermore, consumer electronics should be highlighted because of the many major factors for the market’s rise, which include greater access, increased awareness, changing lifestyles, lower unit pricing, and increased disposable income.


              India’s chemicals industry is extraordinarily diverse, with over 80,000 commercial products that can broadly be classified as bulk chemicals, specialty chemicals, agrochemicals, petrochemicals, polymers, and fertilizers.

              The Indian chemicals industry was valued at US$ 178 billion in 2019 and is expected to be valued at US$ 304 billion by 2025, with an annual growth of 9.3%. Chemical consumption is predicted to grow at a 9% annual rate by 2025. The chemical industry is considered a major economic driver, with the chemicals sector being expected to contribute 300 billion to the country’s GDP by 2025, accounting for 25% of the industrial sector’s GDP.

              Graph showing India's chemicals market size

              On a global basis, India has a strong position in chemical exports, ranking 14th in exports (excluding pharmaceuticals). Organic and inorganic chemical exports increased 38.67% year-on-year to US$ 24,313.88 million between April 2021 and March 2022.

              During the Covid-19 outbreak, the Indian chemicals sector benefited from a slew of opportunities resulting from supply chain disruptions in China, the trade disputes between China and the US, and anti-pollution policies in China. In addition, India’s proximity to the Middle East, the world’s largest supplier of petrochemical feedstock, allows it to capitalize on economies of scale.

              Several measures have been taken by the Indian government to prevent the dumping of inferior and cheaper chemicals, including the implementation of a BIS-Certification system for imported chemicals. Several fiscal incentives, such as tax rebates and special incentives, are available to encourage the development of downstream units in Petroleum, Chemicals, and Petrochemicals Investment Regions (PCPIRs) or Special Economic Zones (SEZs).

              As a result of these incentives, the industry is expected to be able to increase production and develop in an efficient manner. The PCPIRs policy is expected to attract $276.46 billion in investment in dedicated integrated manufacturing clusters by 2035.


              Like the leather industry, the textile industry in India is one of the country’s oldest, stretching back several centuries. The textile business is immensely diverse, with hand-spun and hand-woven textiles at one end of the spectrum and capital-intensive modern mills at the other.

              The strong manufacturing base of a diverse range of fiber/yarns such as cotton, jute, silk, and wool, as well as synthetic/man-made fibers such as polyester, viscose, nylon, and acrylic, is the major foundation of India’s textile sector. Another important element of the Indian textile industry is the dominance of the decentralized power looms/hosiery and knitting sector. The textile industry stands out from the rest of the country due to its tight ties to agriculture (for raw materials such as cotton) and the country’s ancient textile culture and customs.

              India is the world’s largest cotton producer, with cotton production expected to reach 7.2 million tons by 2030 due to rising consumer demand.

              From 2019 to 2025-26, the Indian textile and clothing sector is expected to grow at an annual rate of 10%, reaching US$ 190 billion. In terms of the textile and clothing trade, India represents 4% of the global market.

              Graph showing India's textile exports

              Can India replace China as a manufacturing hub?

              In the short-to-medium term, India cannot dethrone China as the world’s manufacturing power due to some of the shortcomings mentioned.

              First, India’s workforce and infrastructural availability lag well below China’s. Not to add that many Indians who grow up in the slums spend their entire lives without having their names registered in official records. As a result, India’s labor-skills deficit with China is likely to be worse than official figures indicate.

              Manufacturing necessitates capital, particularly infrastructure, in addition to labor. Few developing countries, including India, can compete with China in this respect. Despite increased infrastructural investment in recent years, India is still not at the same level as China.

              Although India has little to no chance of replacing China as the world’s factory, it’s expected to become a sourcing destination that complements China, particularly due to companies’ shift in implementing China-plus-one strategies.

              With that said and looking into the future, India has the potential to become a global manufacturing hub, contributing more than $500 billion to the global economy yearly by 2030.


              When it comes to choosing a sourcing location, India will surely be a top-of-mind option not only in Asia but worldwide. This is especially visible in the light of companies’ China-plus-one strategies, and where many corporations have been migrating out of China in search of new sourcing destinations.

              Looking at optimal sourcing locations, India has numerous characteristics that set it apart. Aside from having a young, competent workforce in large numbers and at a low cost, India also has other manufacturing advantages such as all-around manufacturing competence, a favorable economic environment aided by government efforts, and a giant domestic market.

              Bright as it may seem, Indian manufacturing still has many disadvantages. Poor infrastructure conditions, complex legal systems, and a significant reliance on imports are the most visible drawbacks that multinational firms should be mindful of when producing in India.

              Although replacing China as the world’s manufacturing powerhouse appears to be an impossible task in the short-to-medium term, India is unquestionably the brightest star in the sky among additional sourcing destinations to include in the China-plus-one plan.

              Read more about our sourcing & supply chain expertise or our other consulting services.


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                Electronics Manufacturing & Sourcing in Malaysia: An Introduction

                Semiconductor production line


                The Malaysian electronics manufacturing industry began in the 1970s with simple components and semiconductor parts assembly. Throughout the years, the industry matured to complete assembly of computer equipment, TV, electric vehicles, and smart electronics.

                Malaysia is ambitious in moving the sector further in the value chain to create advanced autonomous units such as autonomous vehicles, robots, and intelligent machines. In this article, we review Malaysia’s electronics industry, where you can find most suppliers, what electronics products that are produced, the benefits of choosing Malaysia, and more.

                Where are electronics produced in Malaysia?

                Malaysia is divided into two main islands, Western Malaysia, also known as Peninsular Malaysia, and Eastern Malaysia. Most of the manufacturing can be found in Western Malaysia.

                Western Malaysia

                Most of Malaysia’s electronics manufacturing facilities are in the Western parts. Within this region, the most critical states for electronics manufacturing are Penang, Selangor, and Johor.


                The state has the most manufacturing facilities in Malaysia. These facilities focus on the production of integrated circuits (IC), packaging, design, and semiconductor manufacturing, both backend and frontend. Furthermore, the state is also the central location in Malaysia for EMS.


                The state that has the second-most manufacturing facilities in Malaysia. Like Penang, Selangor is strong in IC packaging, design, and semiconductor manufacturing. However, Selangor also has facilities for producing consumer and industrial electronics.


                The state that has the third-most manufacturing facilities in Malaysia. Johor focuses mainly on EMS, but the state also has facilities for backend semiconductor manufacturing and a facility of Panasonic for consumer and industrial electronics.

                Eastern Malaysia

                In contrast, Eastern Malaysia has only a few electronics manufacturing facilities, all in Sarawak. Eastern Malaysia’s facilities focus on EMS and frontend semiconductor manufacturing.

                What electronics products are manufactured in Malaysia?

                As a major exporter of electronics, Malaysia is particularly strong in four sectors: semiconductors, industrial electronics, telecommunication electronics, and consumer electronics.


                Malaysia produces 5% – 7% of the semiconductors globally. Besides, it also accounts for about 13% of the semiconductor testing and assembly. The country is particularly strong in designing, engineering, and in packaging integrated circuits (IC).

                Semiconductor manufacturing is also the most important of Malaysia’s electronics manufacturing sector, with much production capacity spread across the country, primarily concentrated in Penang, Johor, and Selangor.

                As the US introduced a ban on the imports and exports on semiconductors from China, Malaysia is poised to benefit as manufacturers move to other countries to comply with US regulations. Yet, the transition period is anticipated to be slow in the first years.

                Industrial electronics

                Industrial electronics production is clustered in Negeri Sembilan, Johor, Selangor, Kedah, and Melaka, with the heaviest concentration in Penang and Kulim, Kedah. Industrial electronics products can include transmitters, routers, and embedded systems.

                Malaysia’s industrial electronics sector is prioritizing high-technology applications to help advance the entire electronics manufacturing industry to a higher value chain.

                Telecommunication equipment

                According to the United Nations Conference on Trade and Development (UNCTAD), between 2011 and 2021, Malaysia’s telecommunication exports value rose by 35.3% from US$5.7 billion in 2011 to US$7.8 billion in 2021. Examples of telecommunication equipment include hardware such as routers, cables, and mobile devices.

                As a sign of Malaysia’s growing importance in telecommunication equipment production, Ericsson chose the country in 2022 to become the company’s Asia-Pacific hub for manufacturing and distributing 5G telecom equipment. With China-produced telecommunication equipment banned in the US, Ericsson’s investments will elevate Malaysia as a viable alternative for manufacturing telecommunication equipment.

                Consumer electronics

                Similar to industrial electronics production, consumer electronics production concentrates in four states: Negeri Sembilan, Johor, Selangor, Kedah, and Melaka. Examples of consumer electronics products include audio-visual devices such as televisions and cameras.

                Malaysia’s largest EMS manufacturers, such as VS Industry and SKP Resources, are particularly active in this sector. With the easing of global supply chain disruptions, these companies achieved strong sales growth in 2022. Nevertheless, the post-2022 period will be more challenging as demands for consumer electronics can slow or decline altogether.

                Benefits of Sourcing Electronics in Malaysia

                Malaysia offers companies with long experience in the sector, good infrastructure, a skilled workforce, governmental incentives, and other benefits.

                Strong record of foreign investments and export

                Malaysia has a robust foreign investment presence in the electronics manufacturing sector, pointing to the country’s experience and ability to absorb foreign investments effectively. Foreign sources account for about 98.8% of the total investments in electronics manufacturing in 2021.

                These investments, in turn, have allowed Malaysia’s electronics industry to contribute nearly 40% to the country’s total exports. This figure also demonstrates Malaysia’s deep experience in exporting electronics products.

                Skilled workforce

                As the electronics manufacturing field is highly technical, the rate of science, technology, engineering, and mathematics (STEM) education attainment is also vital. In this metric, data from UNESCO shows that Malaysia ranks first in Southeast Asia, with 38.9% of graduates in 2020.

                The high rate of STEM education attainment demonstrates that Malaysia’s workforce can perform effectively as electronics manufacturing workers.


                In port capacity, Malaysia is behind only Singapore in Southeast Asia and ahead of neighbors such as Thailand, Vietnam, and Indonesia. The country’s Port Klang and Port Tanjung Pelepas are among the top 20 busiest ports in the world, according to data from World Shipping Council.

                In addition to port capacity, Malaysia has a denser road network than Thailand and Vietnam. The country is about twice that of Vietnam and 70% more than Thailand in terms of road coverage per inhabitant. Malaysia’s robust port and road capacity enables the country to move goods from factories to export ports quickly.

                Strategic location

                Malaysia is in the Strait of Malacca, the busiest shipping lane in the world. Furthermore, the country also lies in the center of Southeast Asia, with easy access to the region’s economic centers, such as Jakarta, Singapore, Ho Chi Minh City, Manila, and Bangkok.

                Malaysia is also within a six-hour flight time to India and China. Overall, sourcing from Malaysia enables close access to the largest markets for electronic products in the economic centers of the Indo-Pacific, the engine of global economic growth.

                Free trade agreements

                As an individual country and a part of the ASEAN Free Trade Area, Malaysia has signed and ratified 16 free trade agreements (FTA). Apart from Chile and Turkey, Malaysia’s FTAs are primarily within the Indo-Pacific region, with countries such as China, India, Japan, and South Korea.

                Though active in regional FTAs, Malaysia has not entered any free trade agreement with the European Union (EU). Though the EU and Malaysia have conducted several negotiations since 2010, the effort stalled after the seventh round in 2012.

                Despite the absence of an FTA, the EU is still Malaysia’s fifth largest trading partner, with an estimated trading volume of US$42.9 billion in 2020.

                Investment facilitation policies

                To attract new investments, especially in the high-tech manufacturing sector, the Malaysian Government has instituted a generous package of incentives. The package includes tax exemptions of up to 100% of the statutory income and qualifying capital expenditure for 10 years.

                Challenges of Sourcing Electronics in Malaysia

                Despite the many advantages, Malaysia has a more expansive and smaller labor force and a continued dependence on China for components and raw materials.

                Labor costs and labor shortages

                Malaysia’s average wage is comparable to that of China and higher than many of its Southeast Asian neighbors. For instance, the average salaries in Vietnam and the Philippines are only one-third of Malaysia’s. At the same time, Indonesia’s labor cost is only one-fifth.

                Furthermore, Malaysia’s small population of 33.6 million in 2021 means the country’s labor pool is limited compared with China and many of its neighbors. For example, the labor force of Malaysia is only about 40% of that of Thailand and 30% of Vietnam.

                Reliance on china for electrical and electronic sub-components

                Despite being a major exporter of electronics, Malaysia still relies heavily on China for raw materials and sub-components. This type of product is Malaysia’s most significant import from China. Malaysia has been unable to address the issue. In the first seven months of 2022 alone, Malaysia’s imports from China grew by 19.8%, while exports only increased by 13.2%, indicating a growing trade deficit.

                Electronics Manufacturing Services (EMS) Companies

                Malaysian EMS manufacturers are sought after because of their long experience. The companies also offer a wide range of services from design to distribution and a developed network of partnerships with the most prominent global companies.

                Let’s review some of the most prominent companies.

                VS Industry

                Founded in 1982, VS is the leading EMS provider in Southeast Asia and is the largest in Malaysia in terms of revenue. The company’s headquarter is in the state of Johor. However, the company also has manufacturing facilities in China, Indonesia, and Vietnam. In total, the company has about 12,000 employees across four countries.

                VS is moving toward vertical integration, as it can now offer full service to customers, including mould design to supply chain management. VS has a customer base of prominent global companies, such as Toshiba, Sharp, Sony, and Dyson. The enterprise’s range of products encompasses many industries, including audio, telecommunication, automotive, and many others.

                ATA IMS

                Founded in 1972, ATA IMS ranks as the world’s 23rd-largest and Malaysia’s second-largest EMS provider in terms of revenue. The company’s headquarter is also in the state of Johor, along with various manufacturing, retailing, and designing facilities in Malaysia and India.

                Similar to VS, ATA IMS is also moving toward vertical integration with a full range of services from product design to supply chain management. ATA IMS’ range of products focuses mainly on consumer electronics, medical devices, and LED lighting solutions.

                SKP Resources

                Founded in 1974, SKP has grown from a humble facility in Johor Bahru to a major EMS provider with about 2,500 employees. Now, SKP ranks as Malaysia’s third-largest EMS provider based on revenue. The company’s headquarter is also in Johor, but unlike VS and ATA IMS, SKP does not have operations overseas, and all of the company’s facilities are in Malaysia.

                Like the other two companies, SKP offers a wide range of services, from product design to mould design to supply chain management. SKP’s products include IT, audio/visual, medical, and computer peripherals. The company’s clientele comprises prominent customers such as Fujitsu, Dyson, Panasonic, Sony, and Sharp.


                The electronics manufacturing sector remains a prominent part of the Malaysian economy and an essential component of the global supply chain. With a highly qualified workforce, adequate infrastructure, strategic location, conducive incentives from the Government, and experienced EMS providers, Malaysia will maintain its status as a global hub for EMS.

                As electronics manufacturers depart China due to rising US-China tension, Malaysia, with its advantages in experience, workforce, infrastructure, location, and incentives, will benefit. Nevertheless, Kuala Lumpur’s continued trade dependence on Beijing and high labor costs can prevent the country from fully taking advantage of this development.

                As the electronics industry is undergoing tremendous technological changes, Malaysia’s ambition to advance in the supply chain will require innovation from the Government and its leading EMS providers.

                Read more about our market entry & expansion experience or other consulting capabilities.


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                  Setting Up a Company in China: A Complete Guide

                  Meeting to discuss company setup

                  China has been active in lifting restrictions on foreign investments in the past years, with a goal to make the market more attractive.

                  One example is the Negative List, a list of industry sectors that prohibit foreign investments, which had 117 items in 2022, down from 151 items in 2018. The government also removed restrictions on foreign ownership in automotive manufacturing in 2022, as well as on foreign shareholding ratios of securities/investment fund companies in 2021.

                  Even if we’ve seen easing of restrictions, setting up or divesting a company in China is often challenging, considering red tape and local regulations. In this article, we review the company types available in China, the registration processes, and explain common pitfalls.

                  Company Types in China

                  Foreigners can set up three company types in China, including Wholly Foreign-Owned Enterprises (WFOE), Sino-Foreign Cooperative Joint Venture (JV), and Representative Offices (RO).

                  The following table summarizes the three options:

                  Table showing types of company that can be set up by foreigners

                  Let’s review the options in greater detail below.

                  Wholly Foreign Owned Enterprise (WFOE)

                  WFOE refers to a limited liability company that is 100% invested, owned by foreign investors, and independently operated. Almost 60% of foreign-owned companies are WFOEs, making it the most adopted business type. Famous multinational companies such as Apple, Amazon, Oracle, and General Electric are all examples of WFOEs.

                  Setting up a WFOE can bring more risks compared to the other company types due to the higher investment requirements, and if foreign companies lack knowledge of the Chinese market. With that said, there’s also a reason why this is the most popular option among foreigners.

                  Foreign companies can maintain complete ownership of the companies, convert RMB income into USD, and remit profits to parent companies overseas. As WFOEs give foreign enterprises total ownership, there are also no restrictions relating to the company’s internal operating structure.

                  Worth mentioning is also that WFOEs must have a board of directors with three to thirteen members.

                  Sino-Foreign Cooperative Joint Ventures (JV)

                  A JV refers to an enterprise in which a Chinese partner and a foreign partner jointly invest and share company stakes in proportion to the investment. JV is another common business type for foreign companies, with over 35% of the one million foreign enterprises in China operating as JVs.

                  SAIC Volkswagen, SAIC General Motors, and BMW Brilliance are household names that have local JVs in China.

                  JV, in common terms, would have no mandatory registered capital requirements for foreign investors. However, foreign investors’ general capital investment ratio should be at least 25% of the total investment.

                  This company formation type has many preferential treatments depending on the different regions in China. For example, foreign JVs headquartered in Shandong’s designated development zones can all have 15% reductions on corporate income taxes.

                  Other benefits can be gained with the help of your Chinese partner as they provide more marketing channels and utilize business connections, build a stronger brand image, and offer investment support.

                  Common pitfalls with JVs in China

                  Conflict of interests and imbalances of contribution are potential issues when foreign companies set up JVs with local Chinese partners. You should also fully evaluate the local laws as JVs are scrutinized harder and with more reporting obligations.

                  Additional reporting obligations can be related to annual capital contribution ratios, the structure of the board of directors, and methods of hiring/firing the company’s top management. You must maintain a positive relationship with your Chinese partner to fulfill all the reporting obligations and have smooth business operations.

                  As a result, it’s crucial to carefully screen your potential Chinese partner before signing a full-on JV agreement.

                  When the JV is established, a board of directors must be set up to manage and oversee the operations. Representatives from both the foreign and Chinese parties can serve as the board’s chairperson, where the chairperson would then become the legal representative of the JV. The chairman is also responsible for selecting managing directors for the JV’s operation and management.

                  Representative Office (RO)

                  An RO is a liaison agency representing the parent company established by a foreign-invested enterprise in China. Since ROs are not recognized as independent legal entities, they cannot conduct standard business operations, generate profits, and send money abroad. Non-direct business activities, including liaison work, product promotion, market research, and setting up bank accounts, are all permitted.

                  You can consider RO as a market-entry option with fewer initial risks. Foreign enterprises commonly use ROs to study the Chinese market and build business connections, to “test the water” and before entering the market with full force. This is possible as enterprises have no capital limits when investing in and registering ROs in China.

                  Enterprises should beware that ROs can only recruit employees through government-recognized HR agencies and can only set up offices in a foreign-related office building (buildings designated by the government that can have foreign enterprises as tenants).

                  The current RO’s license period is three years, yet ROs can extend their license unlimited times.

                  Foreign Invested Commercial Enterprise (FICE)

                  FICE is also called trading WOFE which allows foreign companies to import and export franchise brands, sell products, open an E-commerce store, get export tax refunds, and deliver related consultation services in China. A FICE can also operate storage, warehousing, inventory management, repair maintenance, training, and delivery services.

                  Apart from the FICE (trading WOFE), you can also choose other types of WOFE according to your business scope, such as technology WFOE, food & beverage WFOE, and manufacturing WFOE that the company can manufacture industrial products in China, etc. There are some limitations that you should know about FICE. You can only do trading business, and VAT(Fapiao) issues can be complex. Also, you must apply for separate licenses before any import-export activities.

                  Before setting up a FICE, you should confirm three things during document preparation: company name, business scope, and registered address. The company must have a lease agreement of at least 12 months for the registered address and cannot share with other companies. Online pre-approval application with the provincial bureau of the Ministry of Commerce (MOFCOM) and the Administrative Committee of Economic and Technological Developments Zones (for FICE set up in economic and technological development zones) is necessary for the license, and you should upload identification documents of the registered personnel.

                  Once approved, you can proceed with the procedures to obtain your Import-Export License Record with the Customs Bureau, State Administration of Foreign Exchange (SAFE), and the local MOFCOM and required Import-Export license depending on your business scopes, such as Foreign Trade Operator Filing Record, Customs Registration Certificate, China E-port IC Card Application, and Goods Trade Foreign Exchange Administration Service Activation. For business owners who think FICE is the most suitable legal entity type, the processing time is around six months, and there is no minimum capital requirement.

                  National Enterprise Credit Information Publicity System

                  The Chinese government has an online platform where you can find information related to business credit information, abnormal/illegal operations, and other company information.

                  The platform is handy for companies that want to know more about potential Chinese business partners. You can receive information regarding untrustworthy business activities, which often result from delayed or missing payments from previous business activities. Simply input the company name, company registration number, or the Unified Social Credit Code of the company.

                  Companies should carefully look for reporting deadlines required by the government. Late reporting on information such as company equity transfer, outbound investment activities, and change of company address have all resulted in serious consequences in the past.

                  Wrongful reporting activities may likely appear in the company’s information page under the National Enterprise System, which would seriously hurt the company image, particularly for new entrants in the Chinese market.

                  The Importance of Stamps and Business Licenses in China

                  Business licenses and stamps might have less importance in other countries, yet they have entirely different levels of power in China.

                  Business license and copies

                  The government issues the original business license, and enterprises can print copies of them. However, the original and copies of the business license have the same legal power. The original must be hung in a noticeable place in your office. In contrast, the copies are generally used for activities such as opening bank accounts and signing contracts requiring traveling.

                  Company stamp

                  The company stamp is the most important stamp of an enterprise, as it is the stamp used for internal and external business activities. The stamp is often controlled by the legal person and can be used to verify documents, contracts, certificates, and other materials.

                  Financial stamp

                  Used only for accounting and bank settlement purposes.

                  Contract stamp

                  Contract stamps are mainly used to sign contracts with clients, which can also be replaced by using the company stamp.

                  The importance of stamps and business licenses must be recognized as stamps are more important than signatures. It’s better to have a standardized process in case of any misconducted risks, including the dedicated person is responsible for the stamp custody and the strict approval process for using the stamps

                  Application documents notarization

                  Sometimes, the authenticity of the foreign applicants’ documents may not be identified by the Industry and Commerce Bureau, which can waste much time during the application process. In one previous case, we helped a client who encountered a problem as the Industry and Commerce Bureau could not identify his passport without China travel records.

                  The passport therefore had to be sent back, which resulted in the client losing weeks of time. Before you submit your documents, it’s therefore recommended to notarize them locally in advance.

                  Time coordination

                  Foreigners must often ship documents several times due to issues with failed identifications. For example, that you can not travel freely while the authorities use your passport during the application process.

                  As a result, it’s important to understand the process in advance and effectively coordinate the shipping of documents, including passports.

                  How Asia Perspective Helped a European Client in Setting Up a Company in China

                  A large Finnish company that specializes in the food industry needed help with a market entry in China, a project where Asia Perspective also helped with the legal entity setup.

                  During the project, we assisted the client with research on local regulatory requirements, preparation of application materials, materials translation, format alignment, and more. The client also benefitted much from our local presence, as we were able to visit related agencies on-site.

                  Asia Perspective ultimately helped the client to complete the establishment of a Chinese legal entity by developing a thorough company analysis, evaluating local regulatory requirements, and efficiently submitting required documentation.


                  Before setting up a company in China, it’s crucial to understand the regional and provincial benefits across China. You should also carefully review the Catalogue for the Guidance of Foreign Investment Industries. Chinese economic zones, preferential policies on foreign-owned entities from provincial and regional levels, and industry-specific incentives can be identified and leveraged through initial research.

                  In this article, we have reviewed the process of setting up a company in China in brief. However, it’s recommended to seek company formation consultancy services, to save time and costs. Without adequate knowledge of the company types and setup processes, the processing time can take months, with additional work such as visiting local registration offices, as well as document verifications.

                  With different regional benefits on provincial and district levels, as well as economic zones’, foreign companies can enjoy tax discounts, financial awards, and foreign employee benefits.

                  Read more about our market entry & market expansion experience or other consulting capabilities.


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                    Vietnam’s Supply Chain: A Comprehensive Overview

                    Vietnam cargo port

                    Vietnam’s supply market gets increasingly more attention as companies seek to diversify manufacturing, and as its manufacturing capabilities increase. It has also introduced various free trade agreements, and the government has eased foreign ownership regulations in the past years.

                    Yet, many companies have little insights into the country’s supply chain capabilities and infrastructure, and how this will change in the coming years. We have therefore written this article and where we will review the following topics:

                    • Vietnam’s economic zones
                    • Vietnam’s supply chain infrastructure
                    • Supply chain issues in Vietnam
                    • Vietnam’s role in the global supply chain
                    • Supply chain cooperation in South & Southeast Asia

                    Vietnam’s Economic Zones

                    Manufacturing is highly concentrated in key economic regions as these are more developed and have received the most investments in infrastructure, logistics, and facilities. Besides, the availability to labor and special financial incentives also play an important role. Let’s start and review the key economic zones of Northern, Central, and Southern Vietnam.

                    Northern Vietnam

                    The North Key Economic Zone covers the provinces of Hanoi and Bac Ninh, as well as Hung Yen, Vinh Phuc, Hai Duong, Hai Phong, and Quang Ninh. Most of the manufacturing activities in the North can be found in the Red River Delta, which consists of two municipalities (Hanoi and Hai Phong) and eight provinces, comprising the above-mentioned provinces except for Quang Ninh.

                    Vietnam’s Northern Key Economic Region is well-positioned as a hub for China-plus-one manufacturing activities – when existing manufacturing in China is complemented by one or more low-cost markets like Vietnam. Many companies have invested in Northern Vietnam to profit from the lower labor costs compared to China while remaining close to Chinese suppliers.

                    Furthermore, the North Key Economic Zone has well-developed transportation networks and prime industrial land on the back of extensive infrastructure development. Particularly, the region’s industrial parks and economic zones are well connected to the sea via Hai Phong port (in Hai Phong city), which is the country’s largest port in the North. Moreover, the Ha Noi-Hai Phong-Quang Ninh (adjacent to Hai Phong) development triangle geographically connects to other economic areas in the country and abroad.

                    Heavy manufacturing dominates the Northern Key Economic Region, which is partly a result of China-plus-one expansion programs. Investors in heavy industries such as automotive utilize the concentration of infrastructure and talent that works to their benefit. Worth highlighting is also that we find many electronics manufacturing clustered in the North, particularly in the Red River Delta region.

                    Investors in other sectors that are not labor-intensive or in heavy manufacturing such as IT may not select the North as the benefits of the infrastructure networks here may not be of significant value due to the nature of these sectors.

                    Southern Vietnam

                    The Southern Key Economic Zone includes the provinces of Ho Chi Minh City and neighboring provinces such as Ba Ria-Vung Tau, Binh Duong, Dong Nai, Binh Phuoc, Tay Ninh, and Long An. The locations of these cities and provinces, excluding Long An province, forms the Southeast region of Vietnam. This region has virtually always led the country in terms of exports, FDI, and GDP growth.

                    In comparison to the Northern Key Economic Zone, the Southern Key Economic Zone has a broader spectrum of manufacturing and services, with stronger economic diversification. As a result, enterprises in more specialized or niche industries may find that the South offers a more conducive environment for investments. This is especially true for small and medium-sized businesses (SMEs), and Ho Chi Minh City has recently been a magnet for startups and tech entrepreneurs.

                    Consumption is another key benefit of the Southern region. Investors seeking to establish a brand identity with Vietnamese customers may discover opportunities in the South, which is home to Ho Chi Minh City, the country’s largest city in terms of population and financial contribution. As a result, Ho Chi Minh City is a favored location for manufacturers of some specific industries such as pharmaceuticals and luxury goods. Furthermore, manufacturing in the South benefits from its proximity to Ho Chi Minh City, Tan Son Nhat International Airport, and various seaports, including Saigon Port and Cat Lai Port.

                    In stark contrast to the North, Vietnam’s Southern Key Economic Region innately lacks proximity to China. Therefore, it takes more time for investors who want to explore a China-plus-one expansion strategy to transfer components between factories in China and assembly facilities in the South of Vietnam. This suggests that investors with time-sensitive manufacturing chains would be best served by selecting locations in Northern Vietnam.

                    Central Vietnam

                    The Central Key Economic Zone is made up of five cities/provinces – Thua Thien Hue, Da Nang, Quang Nam, Quang Ngai, and Binh Dinh.

                    Textiles, building materials, and paper and forest products are the primary industries in this region. Besides, businesses like shipbuilding, logistics, and other high-tech industries are anticipated to grow significantly in the near future.

                    Investors in Central Vietnam’s industrial zones could benefit greatly from infrastructure and facilities designed to meet the needs of the country’s rapidly expanding sectors, such as textiles and electronics.  Da Nang, the economic hub of the Central region, delivers a consistent supply of skilled personnel to the Central Key Economic Zone and offers high-quality factories for rent in prominent locations. Besides, manufacturing in Da Nang also enjoys a higher level of urban planning and development than many other cities in Vietnam. This probably leads to the provision of cascading benefits for a diverse range of investors within the region.

                    Seeming to have a superior organizational structure than other areas of Vietnam, Da Nang is still confined by its population, making retail scalability here a nerve-racking challenge. In other words, there are unlikely to be any ripe opportunities in the Central Key Economic Zone for investors desiring to build a long-term brand identity here.

                    Vietnam’s Supply Chain Infrastructure

                    While other ASEAN nations spend an average of 2.3% of their GDP on infrastructure, Vietnam currently allocates around 6% of its GDP. This significant difference puts Vietnam as the leading country in respect of infrastructure investment in ASEAN. Positive as it may sound, a gap seems to remain between Vietnam’s current infrastructure and its ambition of being a fast-growing economy.

                    According to the Global Infrastructure Hub, Vietnam’s infrastructure requires an average of US$ 25-30 billion annually to secure economic growth. However, the national budget only has room for US$ 15-18 billion (7% of GDP).

                    As a result, the remaining US$ 10-15 billion must be raised from private investors. During 2022-2027, Vietnam’s infrastructure is expected to grow at an annual rate of around 4%.

                    Transportation infrastructure

                    Only 20% of the roads in Vietnam are paved with medium to low-quality materials, leading to cracks and bumpy surfaces. The country is therefore in a desperate need for road quality improvements, given that road transports is the backbone of the country’s logistics and transport industry.

                    In 2021, the government announced the Decision No. 1454/QD-TTg, which promotes the development of a new road system for 2021 – 2030, with a vision stretching to 2050. It intends to expand the current national roadways of 1,290 kilometers to as much as 5,000 kilometers by 2030. This includes the upgrading of road surfaces and expanding access to key ports, airports, and railway stations.

                    In addition to road systems, Vietnam also has 22 civil airports, 12 of which are international and 10 are domestic. In 2025, the Long Thanh International airport in Dong Nai, which would eventually replace Ho Chi Minh City’s Tan Son Nhat International Airport, is planned to be finished in the first phase. Looking ahead, the number of airports is planned to increase to 26 by 2030 and 30 by 2050 by the Vietnamese government.

                    Port infrastructure

                    There are 320 ports in Vietnam with a combined capacity of up to 470-500 million tons of cargo per year. This can be compared to the Port of Shanghai, which handled 542 million tons of goods in 2019, while the port of Singapore handled more than 600 million tons of goods that same year.

                    Specifically speaking of seaport infrastructure, Vietnam currently has 45 seaports – 2 international seaports; 12 regional seaports; 18 local seaports; and 13 oil & gas seaports. Vietnamese port infrastructure is the subject of large-scale investments by many companies globally. However, this infrastructure continues to face hurdles because its current capacity has not been able to match the surging demand for imports and exports. This signals the need for more investment.

                    Manufacturing infrastructure

                    When evaluating and searching the most favorable manufacturing locations, which are typically industrial parks, the technical infrastructure is often regarded as the most important. Transportation infrastructure, which consists of two fundamental aspects – the internal transportation system and the surrounding transportation system – is the most crucial element of technical infrastructure in industrial parks, being frequently examined by investors.

                    Apart from transportation infrastructure, the most relevant technical infrastructure elements in industrial parks are also electricity supply, water supply, and other aspects such as waste treatment systems. It’s crucial to confirm that a factory has all utilities available for companies being able to run operations.

                    Access to roads and seaports

                    Overall, the transportation infrastructure – the combination of the internal transportation system and the surrounding transportation system – is adequate and meets fundamental standards, with considerable variation among regions.

                    First, in terms of the internal transportation system, most industrial parks have a basic infrastructural design. This involves, for example, the deployment of a chessboard pattern or by combining four main road lanes and two side road lanes, which make internal transportation easier.

                    Looking at surrounding transportation systems, we also see differences between industrial parks located in the North, Central, and South. Northern industrial parks are remote from seaports but more than 91% are close to highways, with 11% being right adjacent to highways.

                    In contrast to the North, the Central’s industrial parks include only national roads and provincial roads, with the former accounting for more than 88%. In contrast to the North, the Central region is bordered by the sea, thus the industrial parks here are close to the seaport (57.75% of Central’s total industrial parks), which is suitable for export-import and trade goods.

                    Nearly 60% of industrial parks in the South are adjacent to national roadways, and around 50% are near a seaport, making the South superior in terms of logistics.

                    Electricity supply

                    More than 70% of Vietnam’s industrial parks get electricity from the national power grid, which has a capacity of 22/110 kV. With that said, many industrial parks have increasingly focused on renewable energy as supplements, or even alternatives to coal-fired power. Solar power, in particular, is used in approximately 8% of the industrial parks. Renewable energy plants are also being erected at a growing rate, and an increasing number of factories are installing rooftop photovoltaic panels.

                    Worth highlighting is also the increased interest in eco-industrial parks, which grows in popularity. This concept, which helps mitigate emissions effectively and efficiently, has been experimented with in around five industrial parks so far. Some investors in large industrial parks are progressively integrating the eco-industrial park mode.

                    Water supply

                    More than one-third of Vietnam’s industrial parks have access to a water supply system with a capacity of 10,000 – 20,000 cubic meters per day. Similarly, more than one-third of the industrial parks install wastewater treatment systems that have a capacity of less than 5,000 cubic meters per day. However, industrial parks located near major economic centers usually require substantial water waste treatment capacity, as these generally attract more manufacturing, necessitating more treatment of wastewater.

                    For instance, roughly 45% of the South’s industrial parks that are located within a radius of 30 km from Ho Chi Minh City are equipped with a wastewater treatment system with a daily capacity ranging from 5,000 to 10,000 cubic meters.

                    Unfortunately, most industrial parks have paid scant attention to solid waste treatment. This is evident because more than 90% of Vietnam’s industrial parks lack their own solid waste treatment plants. More specifically, only about 20% of the North’s industrial parks within a 30-kilometer radius have their own solid waste treatment facilities. In general, local service providers will be outsourced to handle most of the garbage treatment.

                    Supply Chain Issues in Vietnam

                    Like most Asian countries, Vietnam is still highly dependent imports of raw materials from China. Consequently, Vietnam’s supply chain has been hampered by raw material shortages due to China’s long-lasting geopolitical tensions and previously strict zero-covid strategy.

                    The country also relies heavily on Chinese imports of intermediate commodities such as semi-processed goods and capital goods, resulting in large trade deficits with its neighbor. In consequence, this leads to longer production lead times and increased logistics costs. Although Vietnam is primarily strong in midstream supply chain activities, it has yet to be a top-of-mind destination for upstream activities, including the design and production of sub-components, as well as downstream activities involving sales and distribution.

                    The uneven manufacturing capabilities across different stages reinforce Vietnam’s fear of remaining an “assembly platform”, and it has a long battle to climb up the global value chain.

                    For Vietnam to move up the global value chain, it must focus more on educating its workforce. This will enable foreign companies to relocate more upstream manufacturing activities such as the production of sub-components in Vietnam, making the country less reliant on imports of such components from China.

                    This will also result in an important shift and allow Vietnam to take full advantage of free trade agreements, like the EU-Vietnam free-trade agreement, for products being considered “made-in-Vietnam”.

                    Vietnam’s Role in the Global Supply Chain

                    Amid the growing manufacturing exodus out of China, Vietnam is one of the largest beneficiaries on the back of many positive characteristics. First, Vietnam has strategic proximity to China – the “factory of the world”. Second, Vietnam’s labor force is abundant at a competitive cost that ranges from one-third to one-half of that in China and lower than most other countries in Southeast Asia. This has resulted in much manufacturing moving from China to Vietnam.

                    Importantly, Vietnam also enjoys a slew of favorable bilateral and regional free trade agreements (FTAs) including the EU-Vietnam FTA, the UK-Vietnam FTA, the Regional Comprehensive Economic Partnership (RCEP), and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Last, the Vietnamese government and authorities actively support the manufacturing sector through a plethora of incentives from tax reductions or exemptions to related paperwork and process streamlines.

                    These perks have provided a big fillip to Vietnam’s position as a promising manufacturing hub and a sourcing market, especially in Asia.

                    Supply Chain Cooperation in South & Southeast Asia

                    Countries in the South and Southeast Asian regions can benefit from the many fruitful trade agreements in the regions, including:

                    • ASEAN-Australia-New Zealand Free Trade Area
                    • ASEAN-China Free Trade Area
                    • ASEAN-India Free Trade Area
                    • ASEAN-Japan Comprehensive Economic Partnership
                    • Regional Comprehensive Economic Partnership

                    Looking at supply chains in South & Southeast Asia, there’s still much room for increased collaboration between the countries, which could reduce their undue reliance on China for the import of raw materials and sub-components.

                    For example, Vietnam could switch to importing more raw materials from other Asian countries that have high availability of certain raw materials, like Indonesia and India. Besides, the countries can also enhance the legal corridor by providing special trade incentives to one another, enhancing and promoting the supply chains linking the countries.

                    These proactive efforts being put in a coherent manner could mitigate supply chain vulnerabilities in South & Southeast countries by gradually cutting China out of the picture, which helps build greater supply chain resilience and strengthen economic self-reliance.


                    Most of Vietnam’s manufacturing is concentrated in key economic zones, thanks to the comparatively developed infrastructure, availability to labor, financial incentives, and governmental support.

                    Although Vietnam’s infrastructure still has room and need for further development, the advantages are notable. This is particularly true as the Vietnamese government has actively invested in the country’s infrastructure more than many other Asian countries in recent years. This leads to considerable expected growth in Vietnam’s infrastructure sector for years to come, which bodes well for the country’s logistics and supply chain.

                    Possessing various strengths, Vietnam stands to benefit from its emergence as an important hub in the global supply chain. This is especially true considering foreigners efforts in decoupling from China. However, there are still critical supply chain issues that must be resolved long-term, related to both infrastructure, efficiency, and production capabilities. One resolution to help address these issues is establishing cross-border supply chain cooperation, especially with South & Southeast Asian countries.

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