China’s production overflow has elevated its position in the global supply chain, especially in the textile and electronics sectors. The United States is currently vigorously enforcing the UFLPA law, aimed at addressing allegations of forced labor in China’s Xinjiang region, requiring all goods sold in the US market to prove they do not use forced labor from Xinjiang. The implementation of this law poses significant challenges to the global supply chain, compelling businesses to reassess their relationships with China, particularly concerning products and raw materials from sensitive areas.
As a result, global brands and manufacturers are seeking alternative supply chains, shifting some production lines to countries like Vietnam, India, and Bangladesh in Southeast and South Asia, which are becoming emerging centers for textiles, garments, and electronics. However, due to these countries’ close ties with China in terms of finance, technology, and raw material supply, their exports to the US will likely be significantly impacted by UFLPA compliance requirements. The impact of UFLPA will be persistent and profound until these countries’ local industries rise independently.