Southeast Asia which is a small continent emerged as the main choice for the world's giant companies. It follows the activity of large-scale sanctions due to the trade war conflict between the US and China that is escalating.
Strategically positioned Southeast Asia has benefited significantly from the China Plus One phenomenon as the Asian giant diversifies its supply chain and product operations.
The 'China Plus One' strategy aims to reduce the risk associated with a complete blockade by the market as well as support the development of manufacturing operations for companies that remain with Chinese goods.
This situation gives a big investment boost for countries in the Asean region. Foreign direct investment into the economies of Indonesia, Malaysia, the Philippines, Thailand, Singapore and Vietnam increased to $236 billion in 2023 compared to the annual average between 2020 and 2022 of around $190 billion.
Inflows mostly come from the United States, Japan, Europe, China and Hong Kong.
Vietnam is now Apple's main manufacturing location as the US tech company seeks to diversify its product assembly beyond China. iPhone worker unrest in China has previously disrupted production operations.
Now, Vietnam is an active country producing Macbook, iPad and Apple Watch.
Malaysia is the main supplier of semiconductors for digital companies such as Intel, GlobalFoundries and Infineon. The industry has grown in recent years amid US-China tensions.
In addition, Indonesia, which is rich in natural resources such as copper, nickel, cobalt and bauxite, is an important ingredient in the manufacture of electric vehicle batteries.
Not to be forgotten, Singapore has been a leading destination for many years as an important site for giant companies such as Bytedance and Shein. Its status as a trusted hub in financial and regulatory infrastructure remains a draw for investors to Asia.
