MII: FDI Manufacturers Will Continue to Leave China

Sina Tech, 2/20/08

The MII's new Public Report on 2007 Electronics and Information Industry Economy and Operations predicts that the trend of foreign-invested manufacturing plants moving to Vietnam, the Philippines and other countries with low operating costs will grow throughout 2008.

Changes at the macroeconomic level in 2007 led to the emergence of this trend: the appreciation of the renminbi; the implementation of the new Labor Law, unification of domestic and foreign enterprise tax policies; adjustments to export tariffs; increased management of processing trade. In 2008, owing to tight currency policy and limitations on land supply, and the progressive weakening of cost advantages for processing and manufacturing will all continue to contribute to the shift of foreign enterprises.

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