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Apple Suppliers Forced to Go Abroad

Caijing Magazine May 29, 2023

By NewsChina Updated Aug.1

To win orders from Apple over the past five years, Chinese suppliers estimate more than 150 firms have started manufacturing abroad. Vietnam, with its cheap and abundant labor and lower land prices, is favored. However, with Vietnam’s growing ambition to be an export and manufacturing center, the low cost has gone and foreign manufacturers must spend at least 30 percent of their manufacturing costs in the local market, including labor and components. Compared to Vietnam, India is more stringent with Chinese investors such as smartphone manufacturers like Xiaomi, Vivo and Oppo. The country is mulling setting a maximum share of 49 percent ownership for Chinese manufacturers who establish joint ventures in India. Chinese enterprises, though being pushed, have to be prudent before going abroad. Nevertheless, China remains Apple’s major supplier, accounting for 94 percent of its production.