China Has To Take A Broader View, If Only In Self-Interest

Automation and robotization in Chinese factories. In South-east Asia, the fallout from this multifaceted phenomenon came most dramatically to view in the closure of Indonesian textile giant Sritex in February, which caused some 11,000 employees to lose their jobs.

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The Indonesian Fiber and Filament Yarn Producer Association reckons that the country shed a quarter-million jobs in textiles and apparel industries over the past two years, and this could worsen in 2025.

This story is repeated in dozens of other industries around the region. Indeed, as anyone who has driven lately on South-east Asian roads—whether Singapore or Thailand or urban Malaysia—knows, the most visible evidence of the China surge is in vehicles.

Take Thailand, Asean’s No. 2 economy which scholars say is undergoing premature de-industrialisation. Its all-important auto industry, which employs more than 700,000 people, if you count ancillaries making spare parts and electronics, has seen a steady fall in employment, amid declining sales of domestically made autos.

While some of this is perhaps self-inflicted, such as the management failures at Nissan, a broader issue has been the technology shift from internal combustion engines to electric vehicles, a sector dominated by Chinese firms such as BYD, Chery and SAIC.

China Passenger Car Association data indicates that exports of new electric vehicles touched 200,000 units in May, an 81 per cent on-year increase. For the January-May period, the increase was 37 per cent as the total number of exports reached 789,000 units.

“Chinese brands have been diversifying their overseas markets to reduce reliance on just a few markets, and have achieved notable success in South-east Asia, the Middle East and Latin America,” Mr Bian Yongzu, the executive deputy editor-in-chief of Modernization of Management magazine, was recently quoted as saying in Global Times.