Bangladesh is a top destination for producers leaving China: HSBC
Bangladesh is one among the three countries that China-based factories are planning to shift their production facilities to, as the manufacture of low-cost products is increasingly becoming pricier in the world's second largest economy, according to an HSBC analysis.
As China loses its edge in the lower end of the product scale, factories are moving to countries like Bangladesh, HSBC's recent look into Asian Economies revealed.
HSBC's find is contrary to the popular belief that many Chinese factories are moving to India and Indonesia, as those are the next biggest markets in Asia where labour is still cheap.
"Well, not quite -- and neither is the Philippines taking market share. Rather, it is Vietnam, Bangladesh and Sri Lanka that are starting to cut into China's traditional stronghold," the analysis said.
HSBC said Chinese firms are making sufficient inroads into pricier areas, like smartphones and solar panels, to keep exports humming, opening up room for others to step in.
"The door has now been opened for China's neighbours to take market share and build sizeable light manufacturing industries of their own. That leaves the frontier markets of Bangladesh, Sri Lanka and Vietnam to pick up the slack."
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