China says only small number of firms moving supply chains out of the country

In recent years, some Chinese manufacturers had already started to relocate capacity to countries such as Vietnam and Cambodia, due to high operating costs at home.
In recent years, some Chinese manufacturers had already started to relocate capacity to countries such as Vietnam and Cambodia, due to high operating costs at home.PHOTO: AFP

BEIJING (REUTERS) - Only a small number of companies are moving supply chains out of China, a commerce ministry official said on Tuesday (July 2), amid signs that some firms are shifting production to other countries as the US-China trade war drags on.

The problem shouldn't be overstated, Chu Shijia, a department director at the ministry, said at a media briefing.

In recent years, some Chinese manufacturers had already started to relocate capacity to countries such as Vietnam and Cambodia, due to high operating costs at home. The Sino-US dispute is now pushing more to follow suit, especially makers of low-tech and low-value goods.

Some Chinese companies had concerns initially when the trade frictions started, but now they have found some ways to cut costs and to minimise the impact, Chu said.