China's Export Downturn — The Foreign Exodus Begins

Procurement Leaders recently picked up on a story in the Sunday Times which suggests that China's halcyon export days could very well be coming to an end. According to the write-up, "the report included an interview with an un-named UK supermarket buyer who claimed that Eastern Europe, Thailand, Vietnam and even Israel, now offer less expensive alternatives than China". Or consider the case of a garment maker quoted in the study who noted that unless they offer preferential exchange rates "foreigners won't buy our products". Telling indeed is the fact that UK organizations, while enjoying a strong currency (unlike the US), are back-peddling on China. Another anecdote to suggest that China is losing its competitive edge comes from my wife, who was recently working on a global sourcing project that concluded last week. The goal was to identify and qualify new sources of global supply for a highly specialized metals category. The winner? A new US supplier. China was not in the running from a price standpoint.

- Jason Busch

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