Let's continue the discussion of what happens when ASEAN catches Covid. We know that it'd drag its own growth downward from the decline of domestic mobility. But this time around, it infects those who exports too as factories are shuttered.
And ASEAN-5 is an export powerhouseπͺπ»
And ASEAN-5 is an export powerhouseπͺπ»
ASEAN-5 exports facts:
*Has about 6% global market share with Vietnam having the largest
*Vietnam manufacturing exports are 2 times the Philippines + Indonesia combined
*Re manufacturing, region key for electronics + footwear + textile (Thailand for auto).
When it catches Covid..
*Has about 6% global market share with Vietnam having the largest
*Vietnam manufacturing exports are 2 times the Philippines + Indonesia combined
*Re manufacturing, region key for electronics + footwear + textile (Thailand for auto).
When it catches Covid..
This is China, the US, EU, Japan, South Korea & France IMPORTS from ASEAN-5. Why this chart? To show DEPENDENCY on ASEAN-5, or what happens if ASEAN production got disrupted.
Chart decomposed into stage of production (intermediate) & commodities (manu/not).
And? ASEAN matters.
Chart decomposed into stage of production (intermediate) & commodities (manu/not).
And? ASEAN matters.
Let's walk u through this chart, what do u see in USD?
*China imports the MOST from ASEAN-5 & mostly manufacturing intermediates in light purple
*US imports the most final goods of capital + consumption goods as well as manufacturing intermediates
*EU less exposed but...
*China imports the MOST from ASEAN-5 & mostly manufacturing intermediates in light purple
*US imports the most final goods of capital + consumption goods as well as manufacturing intermediates
*EU less exposed but...
Let's look at it on a relative basis - share of its total imports. What do u see? Japan, China, South Korea are VERY LINKED to ASEAN-5 via supply chain.
Their imports cut across manufacturing intermediates (also raw materials) + consumption goods, reflecting Asia supply chain.
Their imports cut across manufacturing intermediates (also raw materials) + consumption goods, reflecting Asia supply chain.
Meaning, Asia is most affected by ASEAN-5 supply chain disruption via both production & final goods.
The US mostly via final goods but also some manu intermediates (we'll discuss what).
The EU is less so directly but impacted INDIRECTLY if this affects global prices of goods.
The US mostly via final goods but also some manu intermediates (we'll discuss what).
The EU is less so directly but impacted INDIRECTLY if this affects global prices of goods.
Let's dig deeper, shall we? Here I go into items & sorting it by LARGEST to smallest in value. So u see ASEAN-5 exports/market share of that commodity & to the right the share of ASEAN-5 as a share of total world imports for particular countries/region.
For example semiconductor
For example semiconductor
Cathodes valves = semiconductor & that's the largest value item that ASEAN-5 exports or 115bn USD & its global market share is 12%.
But if u look at import dependency, the US imports half of its total from ASEAN-5, primarily Malaysia - a big player in this. Electronics key too
But if u look at import dependency, the US imports half of its total from ASEAN-5, primarily Malaysia - a big player in this. Electronics key too
Down the list is electronics, intermediates & final goods. China imports a lot from ASEAN-5 as well as Japan and South Korea & the US too.
So u can see here that Asia (ASEAN-5, China, Japan, SK etc) + US are more linked via supply chain than the EU
ASEAN-5 key for electronics.
So u can see here that Asia (ASEAN-5, China, Japan, SK etc) + US are more linked via supply chain than the EU
ASEAN-5 key for electronics.
Beyond electronics, labor intensive manu is key, especially footwear and textile. Look at the market share of ASEAN-5 for footwear at 21% and more importantly for key economies. What does that mean? Disruption of production in this region matters in global markets in key sectors.
We know that ASEAN-5 is diverse & they differ in export composition, with Vietnam being most key give its large manufacturing market share.
Shall we look at Vietnam? Let's go!
Chart shows imports from VN by the US, China, EU, Japan & South Korea & France.
US imports the most!
Shall we look at Vietnam? Let's go!
Chart shows imports from VN by the US, China, EU, Japan & South Korea & France.
US imports the most!
What does the US πΊπΈ import from Vietnam π»π³?
A lot of final goods! Makes sense as it is the largest importer in the world & key destination for Asia supply chain.
China is second & mostly manufacturing intermediates.
A lot of final goods! Makes sense as it is the largest importer in the world & key destination for Asia supply chain.
China is second & mostly manufacturing intermediates.
You can see from the above chart that Vietnam has huge linkages with the US via final goods, China via intermediates and Japan & South Korea via a good mix. EU key but not as huge as Asia & the US.
Let's dig deeper into Vietnam exports & countries' dependency on Vietnamese goods
Let's dig deeper into Vietnam exports & countries' dependency on Vietnamese goods
Vietnam has 1.6% global market share - largest in ASEAN.
Largest exporting item is phones (basically Samsung Electronics FDI in Vietnam)ππ±βοΈ
Footwear is 2nd (Vietnamese wages are cheap!) 1 out of 2 China π¨π³shoe import comes from Vietnam. 1/3 US πΊπΈshoe import is from VNπ π’
Largest exporting item is phones (basically Samsung Electronics FDI in Vietnam)ππ±βοΈ
Footwear is 2nd (Vietnamese wages are cheap!) 1 out of 2 China π¨π³shoe import comes from Vietnam. 1/3 US πΊπΈshoe import is from VNπ π’
And then the list goes on to show u other labor intensive goods like men's clothing etc where Vietnam dominates via Taiwanese, Korean factory investment etc.
The pt? If Vietnamese factories are shuttered, well, π’π footwear is impacted globally, just in time for Christmas season
The pt? If Vietnamese factories are shuttered, well, π’π footwear is impacted globally, just in time for Christmas season
These tables contain a lot of info, including non-manufacturing exports that are less affected by Covid
Did u know that Vietnam is a key exporter of rice & coffee (robusta - Brazil does arabica)? ππβοΈ??? Also fruits &π. Who buys this stuff? Well, China & other Asian neighbors
Did u know that Vietnam is a key exporter of rice & coffee (robusta - Brazil does arabica)? ππβοΈ??? Also fruits &π. Who buys this stuff? Well, China & other Asian neighbors
I have this kind of analysis for each of the ASEAN-5 economy (can do this for any country reallyπ€). But let's leave it for now as I think that's plenty of information to digest already. Read @natixis @NatixisResearch report for more. Bottom line? What happens in ASEAN-5 matters!
Oh yes, forgot about pasting the podcast that summarises those key points and more ππ»ππ»ππ»
the-world-unpacked.simplecast.com
the-world-unpacked.simplecast.com
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