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In What Could be An Ominous Sign For Other Developing Countries, Vietnam Reports Severe Supply Shortages From China

Shoppers in Vietnam's largest city, Ho Chi Minh City, browsing mobile phones that are now in short supply due to supply chain disruptions from China.

Electronics retailers in Ho Chi Minh City, Vietnam’s southern commercial hub, are reporting acute shortages of laptops, mobile phones, and other electronic devices imported from China. Logistics experts there say the disruptions are due to what’s described as a “perfect storm” of supply chain disruption that could be a precursor to shortages in a number of essential product categories.

  1. POWER: The ongoing electricity shortages in some parts of China is prompting factory closures that reducing output for many parts that supply just in time production.
  2. FLIGHTS: The number of air cargo flights leaving China has fallen dramatically over the past year due to COVID restrictions and long quarantine times for flight crews.
  3. SHIPPING: Containers and vessels have been prioritized for use on lucrative routes between China and the US/Europe, leaving Global South countries in the lurch.

African countries are especially vulnerable to the supply chain disruptions from China given how much of the continent relies on imports for food, consumer goods, and building materials among other categories. Already, traders have struggled to find containers and vessels to get their goods to market but if the problem worsens, then it could have a range of potentially harmful knock-on effects including higher rates of inflation and unemployment.

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