There is a major shift in the manufacturing landscape of the world. Emerging economies are leading in this change and this has been influenced by low labor costs, better infrastructure and good business climates.
The way the emerging economies are redefining the global manufacturing centers.
Consequently, these economies are emerging as an attractive destination to manufacturers who would like to increase their operations in them. This shift has not only been changing the global manufacturing environment but also offering new opportunity to both the business and investors.
Key Takeaways
- The contribution of the emerging economies to the world manufacturing is expanding.
- The major reasons are low labor expenses and infrastructure enhancement.
- Manufacturers are being lured by favorable business environments.
- Businesses and investors are getting new opportunities.
- The international manufacturing environment is getting more varied.
The Changing Landscape of Global Manufacture
The manufacturing world is changing dramatically the world over. The shift in conventional manufacturing giants is as a result of many economic factors and technological developments which have resulted in changes.
The old Manufacturing Giants and the Fall of the Giants
The previously regarded manufacturing powerhouses are experiencing a downturn in the countries. This is all due to increased labor expenses, tight regulations and failure to compete with new economies that are providing more desirable manufacturing conditions.
Economic Forces that led to the manufacturing migration
The migration of manufacturing facilities is being caused by economic factors like cheap labour, government incentives and better infrastructure in the developing nations. Also, technology has enabled businesses to establish and conduct business remotely with ease.
Effect on American Supply Chains and Industries.
The relocation of manufacturing in the world has profound effects to the supply networks as well as manufacturing industries in America. Some industries will be challenged by the fact that some of the manufacturing jobs have been lost whereas other industries will take advantage of the fact that they are able to import goods cheaply. The following table explains the effect of the sectors.
| Sector | Impact |
| Automotive | Parts import increases |
| Textiles | Job losses due to overseas production |
| Technology | Supply chain diversification |
Finally, the dynamic nature of the world industrial world has both challenges and opportunities to the industries and economies across the world.
The way the emerging economies are redefining global manufacturing hubs.
The manufacturing environment in the world today is changing drastically, and this is courtesy of the emerging economies. It is through these countries exploiting the various advantages to emerge as new industrial hubs that would rival the traditional manufacturing giants.
The Asian Revolution in Manufacturing.
Countries such as China and the Southeast Asian nations have been in the forefront in manufacturing revolution, which has played a vital role in Asia. The manufacturing industry of China has been changing considerably overtime.
The Transformation of Low-End to High-Tech manufactured goods in China.
China has ceased to be a low-cost production destination to a high-tech manufacturing centre. The powerful investments in the fields of technology and infrastructure make this evolution possible as China currently takes a leading position in high-tech production.
SE Asian Countries Bridging the Gap.
The countries of Southeast Asia like Vietnam, Indonesia and Malaysia are replacing the gap that China has created due to the increase in labor costs. These nations are also having competitive costs in labor and also investing more in industrial development.
The Increasing Industrial Presence of Latin America.
Another developing region in the world is Latin America, which is becoming a major manufacturer. Regional countries are also using the advantage of their closeness to the American market and are enhancing infrastructure to invest.
Strategic Advantage of Mexico to U.S. Markets.
The nearness of Mexico to the U.S. also makes it a desirable site to carry out manufacturing particularly to industries that cater the U.S. market. The manufacturing industry in Mexico is enjoying the trends of nearshoring.
The Manufacturing Development of Brazil and Argentina.
Brazil and Argentina are also building their manufacturing capacities, and they are concentrating in manufacturing industries like automobile and airplane manufacturing. These nations are undertaking industrial development schemes.
The Emerging Potential of manufacturing in Africa.
Africa is already shaping up as a manufacturing base due to the rising consumer market and the better infrastructure. The continent provides investment opportunities in the different manufacturing industries.
Infrastructure Investing in Growth of Manufacturing.
Africa is experiencing growth in manufacturing due to intense investments in infrastructure. The continent is becoming more attractive to investors because of improvement in transportation networks and energy supply.
Opportunities for U.S. Investment and Partnership
There are growing opportunities for U.S. companies to invest in and partner with African manufacturers. Such collaborations can help tap into the continent’s growing consumer market.
| Region | Key Countries | Manufacturing Strengths |
| Asia | China, Vietnam, Indonesia | High-tech manufacturing, competitive labor costs |
| Latin America | Mexico, Brazil, Argentina | Proximity to U.S. market, growing industrial base |
| Africa | South Africa, Ethiopia, Nigeria | Growing consumer market, improving infrastructure |
Conclusion: Living in the New Manufacturing Reality.
There is a profound change in the global manufacturing environment, which is being propelled by the emergence of the new economies. With the fall of the traditional manufacturing giants, new manufacturing centres are being developed in Asia, Latin America and Africa, redefining the manufacturing environment.
In order to stay competitive, the industries will have to adjust to this emerging reality by comprehending the transformations that occur in international manufacturing and changing their strategies to reflect them. Not only are the emerging economies providing competitive labor costs but they are also investing a lot in technology and infrastructure making them a good place to manufacture.
As the world of manufacturing keeps on changing, businesses need to keep abreast with the global changes and be ready to adjust according to the dynamics of the global market. In so doing, they are able to take advantage of the opportunities offered by the emerging economies, and also, to compete in the fast changing global manufacturing environment.
FAQ
What are the emerging economies, and how are they transforming the world manufacturing?
The emerging economies are the nations which are still in the stage of the active development and industrialization. They are transforming world manufacturing by offering new investments, production, and trade opportunities and they are gaining relevance in the world manufacturing arena.
What are the effects of manufacturing revolution in Asia on the world economy?
The manufacturing revolution in Asia is a source of economic growth, emerging trade and investment opportunities and alterations to the global manufacturing environment. Such countries as China and Southeast Asian ones are emerging as great manufacturing hubs, and they are oriented towards high-technological manufacturing and innovation.
What is the role that Latin America is playing in the worldwide production?
Latin America is expanding itself in the industrial sphere and such countries as Mexico, Brazil and Argentina are becoming truly significant in the world production. Mexico has a good location, trade agreements, which makes it a good place to be to the U.S. markets, yet Brazil and Argentina are assembling their manufacturing capabilities.
What is happening to Africa as a manufacturing hub?
Africa is becoming a manufacturing hub because of the investment in infrastructure, expansion of manufacturing capacity and partnership and investment opportunities. African countries are exploring their manufacturing potential and this is geared towards economic growth and development.
What do the new economies mean to the American industries and supply chains?
The emergence of the emerging economies is posing a great influence to the American industries and supply chains as it brings challenges and opportunities. With the migration of global manufacturing, the American industries should also be restructured to keep up with the competition, and the supply chain should be restructured to seize new opportunities.
