It’s actually not at all simple to move out higher value and higher tech manufacturing out of China. For example, Apple tried doing that for iPhone casings and ended up with a 50% rejection rate in India. China has a very highly skilled workforce which is the byproduct of its education system, and it has incredibly sophisticated supply chains. Trying to move high tech manufacturing anywhere else is a losing proposition because the workforce and infrastructure to do that simply don’t exist.
Now, consider this problem from capitalist perspective. If you run a company and you move your production out of China then you’ve just increased your costs significantly. This is putting you in a less competitive position relative to your competition and such a move simply can’t be justified to the shareholders. The only way this could happen is if all western companies were collectively forced to move production out of China by their governments. That’s obviously not going to happen since these companies have huge influence over the governments.
All this talk of moving production to Vietnam or India is akin to greenwash solutions to climate change like the talk of carbon capture. These are token moves intended to make it look like companies are diversifying their production while vast majority of it will continue to happen in China.
Finally, moving stuff out of China into a country like Vietnam or India doesn’t actually solve the problem. India is a perfect example given that the west was courting it as a counter to China, and now India’s policy is increasingly diverging from the west. The only way to ensure your supply chains are secure is to create them domestically. That of course is largely impossible under financial capitalism which is the reason production was moved out of the west in the first place. This article does a great job explaining the dynamics.
On the other hand, China is in a position to cut out western tech and reliance precisely because it’s a manufacturing power. The government has been promoting dual circulation to ensure that there is a robust domestic economy independent of the trade with the west, while internationally China is pursuing projects such as BRI and BRICS that leverage markets in the developing world. China is actively cutting its reliance on the west as an export market, and western pressure is accelerating this trend.
China is already the main trading partner for most countries, and this makes it very difficult for the west to cut China off from trade for the commodities it needs. And as you correctly point out, Russia is a huge country with an incredible amount of natural resources that’s now been pushed firmly into Chinese orbit. But this goes beyond Russia, because there’s now a whole North-South trading corridor via Russia through Syria all the way to Iran that’s completely outside of western control.
What’s actually happening is that it’s the west that’s being gradually cut out of the core world economy that’s centred on China. The west doesn’t produce much of anything nowadays having shifted to being a financialized economy. For example, manufacturing in US is only 11% of the economy, and it’s on a scale comparable to Russia. US is by far the biggest western manufacturing power, and the only other major manufacturing power was Germany whose economy has now been devastated by rising energy prices.
This is an excellent response to the above comment which raised some fairly widespread and reasonable concerns. In addition to what you said about such a shift away from China not being as easy as many people think, the thing to remember is this:
One of the great things about multipolarity is that it doesn’t need to be China alone that sucks up the West’s manufacturing and industrial economy. This task can now be distributed across the global south as a whole and places like India and Vietnam becoming more industrially developed as a result. In fact i believe China welcomes this as it dovetails perfectly with their overarching geopolitical and geoeconomic policy (as exemplified by the flagship BRI project) to lift up the global south as a whole, helping it develop its productive capabilities and thus enabling it to assert more independence from the western neo-colonial hegemony. The US may think that it is playing a smart game by shifting to other countries that they believe they can manipulate against China, but in doing this they are sowing the seeds of their own demise as the more that these countries develop the less leverage the US will have over them.
The point isn’t for China to become the new center of the world around which everything revolves, i don’t think China wants that role or that responsibility, rather it is to distribute power (economic, geopolitical, and other forms) more equally and democratically in the world. And due to the simple fact that the West only makes up a minority proportion of the world they should and will only have a minority of the power once the rest of the world escapes the neo-colonial underdevelopment shackles that have been holding them back and keeping them from catching up. This in turn will make it impossible for the Western imperialist bourgeoisie to crush nascent workers’ states and revolutions the way they have in the past when they enjoyed unipolar or near-unipolar (during the latter half of the cold war) global hegemony.
It’s actually not at all simple to move out higher value and higher tech manufacturing out of China. For example, Apple tried doing that for iPhone casings and ended up with a 50% rejection rate in India. China has a very highly skilled workforce which is the byproduct of its education system, and it has incredibly sophisticated supply chains. Trying to move high tech manufacturing anywhere else is a losing proposition because the workforce and infrastructure to do that simply don’t exist.
Now, consider this problem from capitalist perspective. If you run a company and you move your production out of China then you’ve just increased your costs significantly. This is putting you in a less competitive position relative to your competition and such a move simply can’t be justified to the shareholders. The only way this could happen is if all western companies were collectively forced to move production out of China by their governments. That’s obviously not going to happen since these companies have huge influence over the governments.
All this talk of moving production to Vietnam or India is akin to greenwash solutions to climate change like the talk of carbon capture. These are token moves intended to make it look like companies are diversifying their production while vast majority of it will continue to happen in China.
Finally, moving stuff out of China into a country like Vietnam or India doesn’t actually solve the problem. India is a perfect example given that the west was courting it as a counter to China, and now India’s policy is increasingly diverging from the west. The only way to ensure your supply chains are secure is to create them domestically. That of course is largely impossible under financial capitalism which is the reason production was moved out of the west in the first place. This article does a great job explaining the dynamics.
On the other hand, China is in a position to cut out western tech and reliance precisely because it’s a manufacturing power. The government has been promoting dual circulation to ensure that there is a robust domestic economy independent of the trade with the west, while internationally China is pursuing projects such as BRI and BRICS that leverage markets in the developing world. China is actively cutting its reliance on the west as an export market, and western pressure is accelerating this trend.
China is already the main trading partner for most countries, and this makes it very difficult for the west to cut China off from trade for the commodities it needs. And as you correctly point out, Russia is a huge country with an incredible amount of natural resources that’s now been pushed firmly into Chinese orbit. But this goes beyond Russia, because there’s now a whole North-South trading corridor via Russia through Syria all the way to Iran that’s completely outside of western control.
What’s actually happening is that it’s the west that’s being gradually cut out of the core world economy that’s centred on China. The west doesn’t produce much of anything nowadays having shifted to being a financialized economy. For example, manufacturing in US is only 11% of the economy, and it’s on a scale comparable to Russia. US is by far the biggest western manufacturing power, and the only other major manufacturing power was Germany whose economy has now been devastated by rising energy prices.
This is an excellent response to the above comment which raised some fairly widespread and reasonable concerns. In addition to what you said about such a shift away from China not being as easy as many people think, the thing to remember is this:
One of the great things about multipolarity is that it doesn’t need to be China alone that sucks up the West’s manufacturing and industrial economy. This task can now be distributed across the global south as a whole and places like India and Vietnam becoming more industrially developed as a result. In fact i believe China welcomes this as it dovetails perfectly with their overarching geopolitical and geoeconomic policy (as exemplified by the flagship BRI project) to lift up the global south as a whole, helping it develop its productive capabilities and thus enabling it to assert more independence from the western neo-colonial hegemony. The US may think that it is playing a smart game by shifting to other countries that they believe they can manipulate against China, but in doing this they are sowing the seeds of their own demise as the more that these countries develop the less leverage the US will have over them.
The point isn’t for China to become the new center of the world around which everything revolves, i don’t think China wants that role or that responsibility, rather it is to distribute power (economic, geopolitical, and other forms) more equally and democratically in the world. And due to the simple fact that the West only makes up a minority proportion of the world they should and will only have a minority of the power once the rest of the world escapes the neo-colonial underdevelopment shackles that have been holding them back and keeping them from catching up. This in turn will make it impossible for the Western imperialist bourgeoisie to crush nascent workers’ states and revolutions the way they have in the past when they enjoyed unipolar or near-unipolar (during the latter half of the cold war) global hegemony.
Completely agree with that.