“Deglobalization” has entered the narrative zeitgeist. But what’s happening on the ground? This weekly series seeks to answer that question with a round-up of deglobalization developments from the week that’s done.
1. India’s Vasantha Group has invested 7 million USD to open a mold building support facility in West Chester, Ohio, giving it a foothold in the United States as it looks to grow in the medical and packaging markets in North America.
2. The Wall Street Journal profiles US manufacturers seeking alternatives to production in China. Top of the list: Grey Duck Outdoor, which used to rely entirely on production in Shenzhen and has now been developing its own, US-based facilities. (And on that note:
Read Grey Duck founder Rob Bossen in Force Distance Times on a small business playbook for domestic production.)
3. Foreign investors are souring on Chinese State-owned enterprises: As the Chinese economic recovery faltered this year, Global investors turned to State-owned enterprises, assuming that those were the surest bet in a period of uncertainty. But now, with China’s economic news worsening, even those bets are being scaled back.
4. As companies and investors work to cut exposure to China, Japan is reaping the rewards: The Nikkei Stock Average saw the sharpest rise among major global stock indexes in May, led by semiconductor and related stocks.
5. Mentions of reshoring in S&P 500 earnings transcripts were up 128% in Q1 2023. That’s higher growth than mentions of AI. According to CNBC, the trend is a function of China’s lessening production dominance, Russia’s invasion of Ukraine and aftereffects of the COVID-19 pandemic, and new US manufacturing incentives.
6. Canada’s second-largest pension fund Caisse de dépôt et placement du Québec (CDPQ) has stopped making private deals in China and will close its Shanghai office this year. The news follows a May 8 parliamentary hearing in which several Canadian pensions, including CDPQ, were asked about their relationship with China as bilateral political tensions have intensified.
7. A Chinese fighter jet conducted an “unnecessarily aggressive maneuver” by darting in front of an American surveillance plane over the South China Sea on Friday. The intercept came as Defense Secretary Llyod Austin arrived in Japan for meetings.
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