China's Reliance on Taiwan for Key Imports Grows as Southeast Asia Steps Up
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China is becoming increasingly dependent on Taiwan for intermediate goods like computer chips, with Taiwan accounting for 14% of China's intermediate good imports in 2022, up from 12.2% in 2018.
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China has reduced its imports of intermediate goods from South Korea and Japan recently. South Korea's share fell from 12.7% in 2018 to 10% now.
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China is now relying more on Vietnam and Indonesia for intermediate goods, with both countries seeing their share of China's imports rise by over 1% between 2018 and 2022.
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The increased reliance on Taiwan is partly driven by higher demand for advanced semiconductors during the pandemic.
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Chinese businesses expanding production to Southeast Asia is driving increased imports from countries like Vietnam and Indonesia.