Wed. May 22nd, 2024
Employees work on the production line of a factory manufacturing fashion accessories in Sihong county, Jiangsu province, China March 27, 2019. Picture taken March 27, 2019. REUTERS/Stringer

Have a strategy they believe will help their business grow overseas. In particular, Yudhoyono, who foresaw that the global commodity boom was about to end, started to develop a strategy to move away from the export of raw minerals and bring in manufacturing investments to turn such minerals into value-added products. This was essentially because the global commodity boom did increase Indonesia’s GDP, but according to many experts in the country, these economic benefits did not reach the broader population and did not translate into poverty alleviation. Part of the reason the environmental and social impacts of Chinese investment have become so prominent in Indonesia is also connected to the macro dynamics of IMIP and other industrial parks.

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Poland is the leading country in terms of the percentage of its population employed in manufacturing (see Table 2). A total of 20.2 percent is employed there, followed by Germany (19 percent), Italy (18.5 percent), Turkey (18.1 percent), South Korea (16.9 percent), China (16.9 percent), and Japan (16.9 percent). About 10.5 percent of the American workforce is employed in manufacturing. The top ranked nations in overall manufacturing environment were the United Kingdom and Switzerland (both with 78 points out of 100), followed by the United States (77 points), Japan (74 points), and Canada (74 points). We found these nations performed well due to their policies, cost considerations, workforce investments, and infrastructure. IMIP’s Chinese employees often take on supervisory, technical, or managerial roles, while Indonesian employees make up the main workforce. According to a former senior executive, the park often organizes games to facilitate intercultural sharing and friendship.

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While offshore, getting your product manufactured at a cheaper price from a reliable supplier is like finding a needle in a haystack. But the reality is, being a business owner, you know exactly how much your product will cost. So, stop falling into the trap of scammers offering you low prices that seem too good to be true. Almost 60% of clients who came to us had a negative experience with their previous supplier in China. The main reason was – they only focused on the cost of production and ignored other important factors. To understand how to bypass these fraudsters and get your products manufactured from the best factories in China, read our latest blog post on “Offshore Manufacturing.” This has helped China lead the world not just in labor-intensive products but also capital-intensive ones – everything from Frisbees to iPhones.


The World Unpacked is a monthly foreign policy podcast that breaks down the hottest global issues of today with experts, journalists, and policymakers who can explain what is happening, why it matters, and where we go from here. Another local concern about the park involved safety standards, especially in its beginning phase, when a helicopter crash and fatal accident recorded on camera went viral with the Indonesian public on YouTube. Indonesia was already notorious for work accidents and safety flaws, but workers lamented that standards within the new Chinese-invested park and the equipment provided were insufficient even by Indonesian standards. Some workers claimed a complete set of safety gear was distributed once a year to all employees, but this was often insufficient, and most people had to buy their own.

Favorable terms of trade are much more important for low value added manufacturing. A company that makes high precision engineering products can pay slightly higher for raw material as the raw material cost would be a small percentage of total costs. A garment manufacturer or a leather goods manufacturer, however, would be much more sensitive to raw material costs. Such low margin businesses generally are high employment generators. If the inputs are high costs, higher employment generating businesses suffer more. As China’s labor costs rise and supply chains tighten, many importers have shifted toward a China plus one approach in recent years. And a relatively new player in the Asian economy, Sri Lanka, is quickly rising as a key possibility for sourcing.

Read more about China Business Strategy Consulting here. “Gold” or “verified ratings” are not the last word on trustworthiness. What you also need to remember is that any supplier who pays Alibaba an annual fee for premium membership can get gold supplier status, which increases the vendor’s visibility on the site. Alibaba, for instance, gives its suppliers “gold” ratings, which purchasers see as a sign of trustworthiness.

The upgrade of consumption was also reflected in the steady growth trend of travel expenditure, hotel and restaurant sales, and education expenses (see Exhibit 5). In 2018, 5.0% and 3.9% out of the 6.6% GDP growth rate was driven by consumption and services, respectively. However, compared to developed economies, the contributions to GDP from household consumption and services remained low, suggesting ample room for further development in the future (see Exhibit 3). Be sure to check out the Beginner’s Guide to Outsource Manufacturing to see if it’s the right strategy for your business. New to novice-level importers typically choose this freight management process. The pro to this option is that all you have to do is instruct the supplier to ship cargo as CIF “Port of Destination” or DAP “Your facility Address”. The con to this option is that you may have to pay more than necessary and there are other options available that will save time and money.

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