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COVID19 had a major impact on lives of individuals around the world. The spread was phenomenal and in order to contain the virus, severe restrictions were imposed worldwide on travel and commercial activities.
The initial supply shock was followed by enormous demand of mainly food, pharmaceutical and medical equipment’s. The pandemic revealed the fragility of our current supply chain system which epicenters in China.
Covid-19 has also augmented the current trend of US companies looking to find alternate supply chains, since the Trump government has been in power. The US views of China increasingly became negative amidst Coronavirus outbreak. According to a new Pew Research Center survey of Americans conducted in March. Roughly two-thirds now say they have an unfavorable view of China.
Many business insiders are predicting, China could lose its central position in many global supply networks to Brazil, Mexico and certain emerging markets in South-east Asia as the US-China trade war, clouded by COVID19 are deteriorating.
Many of the Japanese, Korean and Taiwanese companies have already started to adopt China+1 strategy by diversifying their operations and supply chains.
China on the other hand is one of the biggest exporter of consumer electronics, home appliances, personal computers, mobile telephones and, most recently, automobiles, and has a competitive edge of price on majority of other suppliers. The industrial development in China had seen a tremendous shift in last decade, with all big brands having their substantial presence.
The global supply chain is yet to see some major changes with diversification policies of US and EU being the major markets. China on the other hand is developing alternative markets as well as strengthening its manufacturing capabilities.
