Because of the Sino-American war ... the next iPhone was made in Vietnam

It seems that the winds are coming this time as the ships desire, as the giants of technology are turning to small countries such as Vietnam, Thailand, India and Indonesia to be new technological centers in the Asian continent after the raging economic war between the United States of America and China.

Why are tech companies fleeing China?

It is no secret that technology companies are striving to move their factories outside China, such as HP, Lenovo, Dell, Microsoft, Amazon, Sony, Google, the Korean giant Samsung and Apple, and this is all because of the exorbitant tariffs imposed by the Trump government on products coming from China and vice versa, as the Chinese government imposed a high tariff on products. American.

Many technology companies believed that India was the best option and that it would grab a large portion of the pie. Apple asked the iPhone assemblers Foxconn, Pegatron Corp. and Western Corp to make low-priced iPhones, and Samsung opened the largest smartphone manufacturing facility in India.

But after India seemed to be the only winner, some obstacles appeared that made the matter difficult, as there is a law in Indian legislation that provides for compulsion Companies By using 30% of local materials to be able to open retail stores in the country, perhaps making technology companies set their sights apart on other countries such as Indonesia, Thailand, and most importantly, Vietnam.

According For The New York TimesThe manufacturing companies in Vietnam are in talks with the technology giants and promise to increase their capacity to manufacture and produce materials because there are challenges that technology companies will face there due to higher material prices compared to China, for example, plastic is 5-10% more expensive in Vietnam compared to China, but If Vietnamese manufacturers produce more of these materials, prices will drop.

The United States and China will hold another round of negotiations in Shanghai soon, but many expect that the effects of the trade war between the two countries will remain for a long time. Therefore, technology companies intend to gradually move their factories and operations outside of China, in addition to the efforts made by Vietnam to develop infrastructure to be the best alternative for China. .

Tech companies that switched to Vietnam

And the companies that switched to Vietnam include Nintendo, which moved its console production plants to Vietnam, and Foxconn, which is the main complex for iPhone devices, managed to obtain land use rights in Vietnam and pumped $ 200 million into an Indian company so that there is a diversification in its production process as companies seek Taiwanese and Chinese to increase its operations and factories in Vietnam, and there is Samsung, which now has a presence in Vietnam and manufactures and assembles its phones there.

Vietnam, which has a population of about 100 million people, cannot be said that it will replace China as a manufacturing center overnight, the land may be very expensive and there is a shortage of factories and warehouses ready for use and hiring enough skilled workers and well-trained managers is another challenge. .

However, Vietnam is one of the giants of the production of shoes, clothes and other types of labor-intensive goods. It has factories for international companies such as Adidas and Nike. The Vietnamese government also intends to improve roads, ports and power stations and has signed agreements with many governments to reduce tariffs, the latest of which is the European Union, and all of this will Attracts more technology companies in the world.

Source:

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