The China in Africa Podcast The Fate of China's Global Supply Chains in the New Tariff Era
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Apr 9, 2025 
Agatha Kratz, a Partner at Rhodium Group specializing in corporate advisory and Chinese trade policy, and Juliana Bouchot, a Senior Analyst with expertise in Chinese supply chains, dive deep into the complexities of global supply chains amidst rising U.S.-China tensions. They discuss the impact of tariffs on inflation and consumer behavior while exploring whether countries like Vietnam and India can effectively absorb China's manufacturing output. The conversation reveals how traditional supply chains are evolving and the potential shifts in the international trade landscape.
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China's Manufacturing Dominance and Emerging SEA Hubs
- China remains a dominant manufacturing power, increasing its share in many sectors.
- Southeast Asia, especially Vietnam, is emerging as a manufacturing hub, but deep supply chains are still developing.
Factors Influencing Supply Chain Diversification
- Diversification of supply chains depends on de-risking policies and China's comparative advantage.
- Broad tariffs on all countries may freeze supply chains and increase inflation rather than restructure them.
Apparel Sector and China's Continued Role
- Apparel sector diversification has occurred, but China remains a major player, producing over 30% of global exports.
- High tariffs on alternative hubs may keep supply chains in China due to its efficient environment.