Technology Adoption Contributes To China Securing Top Spot In Index Of Global Manufacturing Locations

• Cushman & Wakefield’s Manufacturing Risk Index report shows formerly low-cost locations such as China and India are moving up the value production chain through country-sponsored support of technological adoption
• Growing concern for intellectual property protection, combined with skilled labour availability, keeps United States top when the index is weighted to minimise geopolitical risk
• Low-cost locations in South East Asia still highly attractive for labour-intensive manufacturing
• European production lines, and the free flow of goods, potentially threatened by ‘no-deal’ Brexit

Dr. Dominic Brown, Head of Research for Asia Pacific said, “Low-cost locations in Asia Pacific are still attractive for labour intensive manufacturing and will continue to be sought-after given its cost competitiveness. We are seeing this play out with the China+ manufacturing strategy, which is helping to drive growth in the industrial sector in South East Asia. Developed markets with robust regulatory frameworks such as Australia, Singapore and Japan offer companies a reasonable level of protection from geo-political and loss of intellectual property (IP) risks.”

The rankings also reflect an element of protectionism and nationalism putting global and regional and supply chains at risk. In Europe, the outcome of the ongoing Brexit negotiations will redefine regional production lines as well as reshape domestic and international flow of goods.

Countries which invest in platforms that facilitate flows in and out of production lines will succeed. China’s seamless supply chain connections have resulted in substantial investment in infrastructure and multi-modal transport, including the New Silk Road rail and maritime projects, in addition to incentives. These factors are off-setting concerns regarding intellectual property.