Japanese Companies , the United States, and other countries are escalating their efforts to shift production out of China in order to reduce the risk of supply chain disruption caused by rapid changes in Chinese government policy and the turmoil caused by the spread of COVID-19.
Teikoku Databank, Ltd. reports that as of June of last year, there were 12,706 Japanese-affiliated businesses operating in China, a decline of 940 over the previous two years and almost 1,700 from the high year of 2012.
In 2019 and 2020, the South Korean company Samsung Electronics Co. relocated its PC and smartphone manufacturing to Vietnam.
According to The Singapore Post, which cited the Japanese media outlet Asahi Shimbun, 135 companies involved in the production of semiconductors, apparel, household appliances, cosmetics, and motor vehicles have started shutting down their operations in China.
Some Japanese businesses are returning home because they believe the weakened yen is hurting their earnings, while others are moving their production bases to Vietnam and other South Asian nations.