Market is the most effective means of resource allocation. "Decoupling" and "manufacturing relocation" go against market rules.
The reshuffle of the global supply chain will not lead to decoupling from China, but under market forces, it will become more vertically integrated, more diversified and resilient.
The #covid19 pandemic has driven the restructuring, not only the relocation of the global supply chains. Relocation will inevitably incur new investment costs, but no one has the intent to invest in a recession-clouded world.
The pandemic will urge businesses to attach greater importance to digital infrastructure development, including cloud and remote services, as well as Internet of things (IoT).
For #China to gain competitive edges in the #GVC restructuring, it should: optimize its supply chain by improving the weak links; boost domestic demand, and encourage export-oriented businesses to explore the domestic market;
boost digitalization; attach more importance to the value of online market and give full play to cross-border e-commerce; and expand import.
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