16-Jan-19, HKTDC
As wages in Mainland China have risen, many Hong Kong enterprises with manufacturing facilities there have tried to cut operating costs – one option is to take production lines offshore. The cost-effectiveness of wages in these offshore centres is an important consideration. Emerging economies in Asia – such as Indonesia, India and Vietnam – have become industry hosts.
%20HKTDC.jpg "Made in China moves to Indonesia (c) HKTDC")
Image: HKTDC
This strategy can also mitigate problems brought by Sino-United States trade friction. Hong Kong-based Combine Will produces mainly corporate gifts, toys and consumer goods. It opened its factory in the mainland 30 years ago but rising wages led the firm to seek fresh labour markets to enhance its competitiveness. The enterprise selected Indonesia which, with more than 260 million people, has the fourth-largest population in the world. Their new factory enables them to label their toys "Made in Indonesia".