Rethinking of Supply Chains in ASPAC A Report By KPMG

Emerging economies in the ASPAC region hold the potential to become viable supply chain alternates: KPMG’s Report

INDIA: Select KPMG member firms from the ASPAC region have come together to present an industry point of view on the potential supply chain realignment opportunities with a view to fortify the region’s attractiveness as a viable investment destination. The report aims at providing a country-by-country analysis on its supply chain competitiveness across select sectors basis defined economic and business parameters. The shortlisted countries include Hong Kong SAR, India, Malaysia, Singapore, Taiwan, Thailand, and Vietnam.

Key highlights:

• —   Governments across these economies are actively pursuing the opportunity to attract manufacturers by offering land, tax benefits and other incentives. This has resulted in cumulative FDI inflow of USD270 billion in 2020.
• —   Hong Kong’s ease of doing business, free port status and business appeal to international and domestic companies have driven growth, thereby providing a conducive environment for manufacturing companies.
• —   India is fast emerging as the global hub for chemicals and electronics manufacturing. Strong focus on ‘Make in India’, ‘Aatmanirbhar Bharat’, investor friendly policies such as Production-Linked Incentive Schemes and a large workforce comprising of engineers and factory workers are propelling India’s attractiveness as a manufacturing hub.
• —   Malaysia has emerged as a cost effective manufacturing destination owing to its strategic location, government initiatives to boost infrastructure and efforts to drive the country towards becoming an Industry 4.0 hub in ASPAC. In 2020, the government of Malaysia approved 1,049 projects in the manufacturing sector
• —   Thailand’s deep expertise in manufacturing products, export competitiveness and strategies such as Thailand 4.0 make it one of the most important manufacturing hubs in the ASEAN region. The country’s automotive manufacturing industry was the largest in ASEAN region and 5^th largest in Asia in 2020, with efforts underway to drive Thailand to become an electric vehicle manufacturing hub.
• —   Vietnam’s attractive manufacturing costs alongside factors such as infrastructure, trade policies, economic growth and response to the pandemic makes it one of the most preferred destinations for companies looking to diversify or relocate supply chains. The country was the 8^th largest electronics exporter in the world in 2020, and recorded FDI of USD13.6 billion in manufacturing in 2020

Arun M. Kumar, Chairman, and CEO, KPMG in India says,

“High performing countries in the ASPAC region are fast emerging as attractive alternate supply chain destinations by creating additional capacities and attracting fresh investments. This leverages the region’s well-developed infrastructure, accelerated 5G development and deployment, and growing skilled labor force which comes together to make an attractive investment story.”

Neeraj Bansal, Chief Operating Officer,  India Global;  National  Leader, Supply Chain  Re-alignment, KPMG in India says,

“The region’s potential to become a global manufacturing hub for electronics and semiconductors is being fueled by high performing emerging economies like Taiwan, Vietnam, India, Malaysia, Singapore, amongst others. The growing manufacturing clusters in these countries, increased adoption of Industry 4.0 and host of tax and regulatory incentives offered by governments are helping MNCs’ drive scale and move up the global value chain at the same time.”

source https://nrinews24x7.com/rethinking-of-supply-chains-in-aspac-a-report-by-kpmg/

October 28, 2021