Southeast Asia Ushers in Golden Era of Manufacturing: Here’s Your Guide

As of January 2026, the Regional Comprehensive Economic Partnership (RCEP) has been in effect for 4 years and officially entered its 5th year. As a key engine for regional economic integration, RCEP, coupled with the upgrade to the China-ASEAN Free Trade Area 3.0, continues to unleash policy dividends.

China has long been ASEAN’s largest trading partner, with China-ASEAN trade volume approaching US$1 trillion in 2025. Against this backdrop, Southeast Asia’s manufacturing sector is entering a golden period of development.

Under the trend of global supply chain diversification, Chinese enterprises are shifting mid- and low-end manufacturing to Southeast Asia to diversify risks. RCEP reduces tariffs within the region, facilitating the mutual supply of components.

Two Core Opportunities

• Electronics, apparel, and auto parts: Vietnam, Indonesia, and Thailand have become popular relocation destinations.

• FDI surges: In 2025, Japanese and South Korean companies increased investments in ASEAN, leveraging RCEP to export to China.

Real Cases: Witnessing the Realization of Benefits
● Vietnam Electronics Factory: A company handling Chinese mobile phone components enjoyed RCEP tariff reductions in 2025, with exports to China growing by 40% and the factory expanding its workforce by 2,000.
● Indonesian Apparel Exporter: By utilizing RCEP rules of origin, the company imported fabrics from China, processed them, and sold them to China and Japan with zero tariffs, with annual orders exceeding 5 billion Indonesian rupiah.

Three Steps to Seize Opportunities

1. Establish a factory or partner with Chinese companies.

2. Apply for RCEP certificates to enjoy tariff preferences.

3. Integrate into regional mainstream supply chains (e.g., Xiaomi, OPPO, and other enterprises’ factories in Southeast Asia).