Featured 24. August 2020 in



What’s the impact on business as relations between the United States and China fray and tensions mount?

Maren Schweizer
Schweizer World Pte Ltd

Tearing Chinese and American corporate worlds apart would hurt everyone. Arguably, deglobalisation has been underway for more than a decade. Covid-19 has accelerated the process by providing a justification for re-shoring.

As de-coupling accelerates, two hostile economic blocs are emerging, one centred around China and the other around the United States.

Moving manufacturing operations to China’s neighbouring countries might not be sufficient. History has shown that proximity is one key parameter in predicting which countries become members of which economic blocs, even against their will.

Businesses need to consider the possibility that large parts of the world may no longer be viable host countries for their supply chains. Restructuring and relocating to (geographically speaking) ”safer” countries come at an extra cash burden and resources at the wrong time. For certain industries this is not a viable option at all, especially if there is no remaining local supply side to start within the ”safer” countries.

We have to avoid blocs and find a way to work together.