Should Companies Diversify from China?

“For decades, China has dominated global supply chains because of its infrastructure capabilities and sophisticated manufacturing ecosystem. Nevertheless, due to rising labor costs, the U.S.-China trade war and the outbreak of COVID-19, multinational companies are considering ways to ensure more resilience in their supply chains. Many U.S. companies have moved their supply chains away from China to other Asian countries such as Vietnam, Cambodia and India, as China’s advantage of cheap labor has increasingly been overshadowed by the advantages these alternative countries present.” (Source: RSM US)

The topic of companies looking to diversify from China is not new. Some companies have been trying to move their lower-end, labour-intensive manufacturing processes away from China. This exercise proved to be challenging and involved many considerations. Our experts at RSM US share why: https://rsmus.com/what-we-do/services/tax/international-tax-planning/international-tax-structuring/should-you-move-supply-chains-away-from-china.html

RSM supports companies with their restructuring activities. If you would like to learn more about how our tax advisory team can support you, feel free to reach out and contact our specialists: