TRADE & DEVELOPMENT
Photo: alekseyliss – Adobe Stock
Carlo Pietrobelli
Nicolò Geri
Photo: Courtesy of Carlo Pietrobelli
Photo: Courtesy of Nicolò Geri
Michele Delera
For consumers, there are benefits too. The label on our next laptop, charger or T-shirt might change, but prices will remain broadly stable – at least before tariffs kick in. In this sense, globalization will not disappear. But it will take on a different geographical shape. developing economies that invest in production capabilities... will be best placed to harness opportunities.” “As economic uncertainty and technology reshape global value chains,
Photo: Courtesy of Michele Delera
investments add value locally, support skills development and avoid social or environmental harm. For consumers worldwide, friendshoring offers a more benign outlook than reshoring or tariffs. Goods may simply be made in different countries, with prices remaining broadly stable. Who could gain? So far, East and Southeast Asia – including Viet Nam, Thailand, Malaysia and Indonesia – have captured the largest share of these friendshoring opportunities, particularly in high-tech sectors like computers. Their exports to China have also risen, reinforcing their central role in Asian manufacturing networks. But whether this momentum continues will depend on tariffs, production costs and the pace of automation. Other beneficiaries could include Latin America and Caribbean nations, led by
Mexico. Here, the automotive sector dominates export growth. South Asia could also benefit, with India expanding in both high- and low-tech products, as well as Bangladesh at the lower-tech end. In contrast, Africa and Western Asia remain largely absent from the emerging friendshoring landscape. The risk to these countries of large- scale reshoring remains limited for now but cannot be ignored amid shifting global trade and investment patterns. But friendshoring could offset or even exceed potential losses, offering new pathways for industrialization. As economic uncertainty and technology reshape global value chains, developing economies that invest in production capabilities – and implement smart industrial policies – will be best placed to harness opportunities. In some cases, friendshoring may even allow them to leapfrog into more sophisticated
• This article is republished from The Conversation under a Creative Commons license:
https://theconversation.com/amid- rising-tensions-friendshoring-might- keep-global-trade-alive-276343
activities faster than traditional development paths would allow.
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