The New York Times recently reported that investors are seeking options to a costly China - a strategy that was also recently outlined in an article by Chris Devonshire-Ellis entitled Corporate America's China-plus-one Strategy. The New York Times reports:"A popular saying among Western investors is that Vietnam is the next China. Cambodia, with even lower wages attracting garment manufacturers, is called the next Vietnam."
However, while China has an estimated population of over 1.33 billion, Vietnam's estimated population is only 86.1 million while Cambodia's estimated population is only 14.2 million. Hence, as investors pore in, costs, especially labor costs, are certain to rise. Moreover, with a total estimated total population of just over 107 million, smaller than the estimated population of the Chinese province of Guangdong (0ver 113 million), the entire Indochina region lacks a sizable internal market. Nevertheless, the Indochina region will certainly stand to gain some benefits from rising costs in China as investors increasingly seek out alternative locations for their operations.