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China’s Antibiotic Exports Soar to Record $3.7B

antibiotic exports

China’s Antibiotic Exports Soar to Record $3.7B

IndexBox has just published a new report: ‘China – Antibiotics – Market Analysis, Forecast, Size, Trends And Insights‘. Here is a summary of the report’s key findings.

Antibiotic exports from China, the largest supplier worldwide, peaked at $3.7B in 2020. Over the past decade, China’s exports steadily grew at an average annual rate of +2.5%. India, the Netherlands and Viet Nam constitute the leading importers of antibiotics from China. Viet Nam recorded the highest growth rate of import value from China over the past decade. Last year, the average antibiotic export price amounted to $44,258 per tonne, increasing at an average annual rate of +4.4% from 2010 to 2020.

China’s Antibiotic Exports

In value terms, antibiotic exports rose from $3.6B in 2019 to $3.7B (IndexBox estimates) in 2020. The total export value increased at an average annual rate of +2.5% from 2010 to 2020.

In physical terms, antibiotic exports from China declined modestly from 100K tonnes in 2010 to 84K tonnes in 2020. Last year, exports waned by -4.2% on the previous year. China remains the world largest antibiotic exporter, accounting for 54% of the global volume.

India (23K tonnes) was the leading destination for antibiotic exports from China, accounting for a 27% share of total exports. Moreover, antibiotic exports to India exceeded the volume sent to the second major destination, the Netherlands (6.1K tonnes), fourfold. The third position in this ranking was occupied by Viet Nam (3.9K tonnes), with a 4.7% share.

In value terms, India ($986M) remains the key foreign market for antibiotic exports from China, comprising 27% of total exports. The second position in the ranking was occupied by the Netherlands ($216M), with a 5.8% share of total exports, and it was followed by Viet Nam, with a 3.9% share.

From 2010 to 2020, the average annual growth rate of value exported to India (+0.6% per year) was relatively modest. Exports to the other significant destinations recorded the following average annual rates of growth: the Netherlands (+7.4% per year) and Viet Nam (+8.4% per year).

In 2020, the average antibiotic export price amounted to $44,258 per tonne, increasing by +7.6% against the previous year. In general, the export price indicated a noticeable increase from 2010 to 2020, rising at an average annual rate of +4.4% over the last decade.

There were significant differences in the average prices for the major export markets. In 2020, the country with the highest price was South Korea ($80,132 per tonne), while the average price for exports to Indonesia ($28,191 per tonne) was amongst the lowest. In 2020, the most notable growth rate in terms of prices was recorded for supplies to the U.S., while the prices for the other significant destinations experienced more modest paces of growth.

Source: IndexBox Platform


Surgical Examination Gowns to Observe Consistent Demand in the Near Future

The demand for examination gowns will be significantly bolstered by the consistent prevalence of chronic diseases. The rising cases of the coronavirus have necessitated the protection of the healthcare workers to combat the infection. Examination gowns, also referred to as medical gowns are widely utilized across health care settings as personal protective equipment.

The gowns mainly protect their wearers from infections or other illnesses that can be caused by highly infectious liquid and solid substances. They also restrict these individuals from transferring microorganisms that are likely to affect vulnerable patients that possess weak immune systems.  In addition, the examination gowns deploy advanced infection-control strategies.

It has been estimated that the global examination gowns market size will register a significant revenue share through 2026. The market value of surgical examination gowns will expand at a considerable rate owing to their higher adoption across all four risk levels. These gowns are highly opted by health care personnel and the affected patients. This is because they offer higher protection from the transfer of microorganisms, body fluids, as well as particulate components to these individuals during surgical procedures.

Use for minimum patient isolation

Non-surgical gowns will witness higher adoption in the next few years as they are well suited to cover most of the body that is appropriate to the tasks. These components are not preferred in surgical and invasive procedures, or in instances where there is a high risk of contamination. Besides, the non-surgical gowns guard the wearers against the spread of microorganisms and body fluids in low and minimal-risk patient isolation conditions.

The annual revenue from minimal risk examination gowns will strike a significant growth rate due to their higher use in basic care situations. These gowns are employed in standard isolation and medical units. They also act as a cover gown for visitors.

On the other hand, the demand for high-risk examination gowns will grow with uses in long and fluid intense surgical operations. They are specifically utilized to offer resistance against pathogens and in instances where infectious diseases are suspected.

Rising popularity of reusable examination gowns

Industry share from reusable examination gowns will register remarkable traction on account of their higher preference over their disposable counterparts. This can be owed to their cost-effectiveness with regard to production, waste, and carbon footprints. These medical gowns also possess optimum barrier properties like a high level of repellency and superior fabric thickness. They also have a longer wash lifespan and offer serviceability features beyond protection, like comfort, durability, and appearance retention.

Examination gown suppliers are focusing on company acquisitions, mergers, and partnerships, to gain an edge over their competitors while simultaneously broadening their footprint across the globe. The COVID-19 pandemic has also substantially paved the way for capacity expansions and novel product launches. For instance, Huntsman Textile Effects collaborated with woven fabric manufacturer, Bao Minh Textile, in May 2020, to come up with fabrics that adhere to stringent performance standards that are needed for isolation gowns.

Medline Industries, Inc., AmeriPride Services Inc., Cardinal Health Standard Textile Co., Inc., and Angelica Corporation are some other companies producing and supplying various types of examination gowns.


Out of Asia: Promise from Pandemic of a Manufacturing Renaissance in North America (Part 1)

The COVID-19 pandemic has exposed the weaknesses of supply chains on which nearly half of the population relies on for life-saving medication. Countries have enforced restrictions on the flow of essential medical supplies in a bid to save their own populations. States competed with the Federal government for ventilators in the market, paying multiples of the devices’ usual prices. Doctors, working in painfully under-supplied hospitals, folded plastic sheets to make their own protective masks. Many U.S. hospitals have had to connect multiple patients to devices meant to sustain the life of one. Hospital doctors and administrators have already been asked to decide who should live and who should die.

Understanding the need to transform the current supply chain, the following is the first part in a three-part series that examines how the promise from the COVID-19 pandemic is a manufacturing renaissance in North America. This first installment will lay the groundwork for understanding the current deficiencies within the supply chain and then pivot to explore the dangers of over-reliance on foreign exporters and what challenges U.S. companies are continuing to face in China.

The Current State of the Pandemic Supply Chain

It is late March 2020. In New York’s Presbyterian hospital, doctors are wrangling to accomplish something that “hasn’t really ever been done before,” at least not according to Dr. Jeremy Beitler, a pulmonary disease specialist. The hospital, one of the world’s largest, is affiliated with two Ivy League institutions and routinely ranks as one of the top five health centers in the U.S. Inside its contemporary art-clad walls doctors are connecting two people to a ventilator designed to sustain a single set of lungs. The process, which had been only tested in animals before, carries with it a host of risks because sharing does not double ventilator access, and many victims need their own device. Moreover, the two patients need different volume and pressure levels, – which means that often one or both cases are kept in sub-optimal settings.

Professionals, including the editor in chief of the journal Respiratory Care, have warned against ventilator sharing, arguing that “the time to try an untested treatment not previously used in humans is not amid a pandemic.” For the doctors in charge of triage at New York’s Presbyterian, however, the other option was death. As Dr. Charlene Babcock, an emergency doctor in Detroit puts it: “If it was me, and I had four patients, and they all need intubation, and I only had one ventilator, I would simply have a shared discussion meeting with all four families and say, ‘I can pick one to live, or we can try to have all four live.’”

This technique has now expanded across the country, as state governments fought to outbid each other to purchase one of the few ventilators left in the market. The machines went to the highest bidder. It has been four months since that day in March, but the situation that led doctors to attempt an untested off-label procedure in one of New York’s top hospitals stems from issues that run much deeper.

Foreign companies made close to 50% of the intensive-care ventilators in the U.S., where at the time, there were fewer than 12 manufacturers with the capabilities to produce them. As the COVID-19 pandemic advanced, even these U.S. manufacturers found it impossible to sharply increase their supply since the hundreds of parts that make up these complex devices were sold by companies across the world. It would take at least eight months for St. Louis-based Allied Healthcare Products to revamp its supply chain and meet the rising demand, according to the New York Times. In less than seven months, there have been close to 150,000 reported COVID-19 deaths in the United States.

This fragile state of U.S. healthcare supply was exposed by an inadequate manufacturing base that had been deteriorating for years. The toll of COVID-19 has revived efforts to overhaul the capabilities of manufacturers in the U.S. – an issue that had been dormant for decades, as manufacturers moved to jurisdictions outside the U.S., principally to Asian countries in pursuit of lower costs. Just last week, newspapers heralded the “end of an era” in U.S. manufacturing as Intel, the largest chipmaker in the country, announced it was finally considering outsourcing its production to Taiwan and South Korea. This policy was embraced by Intel’s competitors but shunned by the Silicon Valley giant for decades.

The COVID-19 pandemic has triggered an unprecedented new consciousness among the U.S. business elite of the potential risk of over-reliance on a supply chain substantially based in Asia. This new consciousness, in the midst of the pressure of COVID-19 on supply chains, the rising public support for economic rescue measures, and the recent signing of the United States–Mexico–Canada Agreement (USMCA) can collectively act to usher in an era of renewed manufacturing in North America.

The USMCA buttresses the free market access among the three North American economies and ensures U.S. producers access to low-cost labor in Mexico. Importantly, it locks in Mexico’s 2013 energy reform, which allows foreign companies to invest in the country’s energy sector and eliminates barriers to trade in energy commodities. Together, these provisions pave the way for more fully integrating the cost­-competitive production base in Mexico with the technical know-how of U.S. manufacturers – a combination with the potential to shift the manufacturing center of gravity out of Asia.

Dangers of Overreliance

Heavily relying on a global supply chain for crucial products is costly. COVID-19 has underlined the dangers of relying on China and other foreign nations for essential supplies and compounded the anti-globalist sentiment that had been developing in the U.S. in the last few years. Close to 68% of Americans surveyed by Pew Research Center supported trade and growing business ties with foreign countries in 2014. In contrast, only 47% said globalization was good for the United States in May of this year.

The U.S. imported close to $472 billion from China in 2019, down from $559 billion in 2018, according to the Bureau of Economic Analysis (BEA). In absolute terms, the most significant component of these imports is consumer products, followed by capital and industrial goods. In relative terms, however, electronics and pharmaceuticals are the sectors on which the U.S. is arguably most dependent on China. In 2019, the U.S. imported close to 70% of its consumer electronics from China. Mexico, Korea, and Vietnam: the next three largest contributors, together, accounted for 19%.  The extent of this dependence is underscored by executives in the auto industry, who told The Wall Street Journal that “they could run out of certain parts used in U.S. factories in coming weeks, with particular concern over potential shortages of electronic components,” as the pandemic forced Chinese factories to temporarily close their doors in February.

Emergent consciousness of the U.S.’s lack of self-sufficiency is perhaps most starkly obvious in the healthcare sector. According to consulting firm A.T. Kearney, close to 70% of protective masks in the U.S. are made in China, as well as 80% of the country’s antibiotic supply – including 95% of ibuprofen and 91% of hydrocortisone. Moreover, some widely used blood-pressure medications and antibiotics are no longer produced in the U.S. at all, and experts warn that China is the only known producer of certain key ingredients in antibiotics used to treat diseases like pneumonia. As of April 2020, 79 countries had imposed export bans or restrictions on essential medications and medical supplies to the U.S. market. India alone banned exports of 26 critical active pharmaceutical ingredients. The resulting undersupply in the U.S. may have already endangered national health. In the U.S., roughly half of the population is dependent on prescription drugs, and the majority use over-the-counter medicines on a regular basis.

Building manufacturing expertise in critical sectors such as healthcare as soon as possible should be a strategic policy goal. Unlike other industries, manufacturing pharmaceuticals requires knowledge and capacity that cannot be built in the short term. According to A.T. Kearney, some types of ventilators and antiseptics are among the easiest products to utilize cross-industry capacity to produce. This, of course, contrasts with the critically low supply of ventilators described above, and the government’s unsuccessful 13-year attempt to shore up that supply. Moreover, even if companies could be outfitted to assemble these complicated machines in the short term, replacing the global supply chain of parts may take much longer.

COVID-19 is testing supply chains across the whole economy. According to A.T. Kearney, close to 82% of companies surveyed indicate the pandemic has profoundly disrupted their supply chain. In comparison, only 5% of U.S. manufacturers indicate the disruption has been minimal. Similarly, according to consulting firm McKinsey & Company, material shortages were the top COVID-19 operational challenge for corporations, with close to 45% of respondents agreeing. This option comes ahead of drops in demand (41%) and cash-flow issues (22%). McKinsey indicated advanced industry, including auto-manufacturing, was the sector most affected by the supply shock, “primarily due to interconnected supply chains spanning multiple geographies.”

The U.S.’s reliance on Chinese imports contrasts with China’s self-sufficiency. According to the United Nations Comtrade data compiled by Goldman Sachs, the only segment where China acquires more than 50% of its imports from the U.S. is in aircraft (63%). Moreover, the only sectors where China imports more than a third from the U.S. are seeds and agricultural products.

U.S. Companies in China Face New Challenges

The current crisis brought into public view the dangers of depending on other countries for essential products. Discontent among U.S. companies operating in China, however, had been developing for months. Several companies now indicate they are ready to reshore out of Asia. In the most recent survey by the U.S. Chamber of Commerce in China (“Chamber”), close to 9% of member companies have already started relocating out of China, and an additional 8% are thinking about doing so. In the resource and industrial (R&I) sector, a full quarter of respondents indicated they are already relocating or considering doing so – the highest proportion across industries. For some producers, remaining in China does not make commercial sense anymore. According to Lei Wang et al., for example, it is already cheaper to produce metal and oil products in the U. S. after the U.S. imposed 25% tariffs on Chinese products.

“An uncertain policy environment, rising costs [in China] and U.S. tariffs are the top three factors influencing relocation considerations,” according to AmCham China. Close to 45% of companies relocating or thinking about doing so cited an uncertain policy environment as one of the top three reasons to relocate in 2019 (up from 9% in 2018). Similarly, 40% cited rising costs, including labor costs (up from 17% in 2018), while 38% pointed to U.S. tariffs on products exported from China.

Companies that are delaying or canceling investments in China cite similar worries. About 37% of firms surveyed by the Chamber, the largest proportion since 2013, indicate they are delaying additional investments in 2020 or looking to reduce their footprint in China. This trend is even more pronounced in the R&I sector, where 43% indicate they will not invest further in the country in 2020. This group of companies also point to the tense U.S.-China bilateral relationships as the most significant barrier to investment, followed by expectations of a slowing Chinese market, rising labor costs,  and uncertain local regulations.

Among the most longstanding concerns of U.S. firms in China are intellectual property (IP) protection and technological sharing. AmCham China suggests this is a lesser concern among firms than it was in past years, and that protections are improving. Close to 69% of U.S. firms surveyed indicated in 2019 that IP enforcement had improved over the past five years – with only 2% reporting that it has deteriorated. Similarly, the percentage of firms that indicated the risk of IP/data security leakage is higher in China dropped 10 percentile points year-on-year to 44% in 2019.

Despite the reported improvements, a significant portion of U.S. companies are still dissatisfied with the state of IP protection. Intellectual property and data leakages are still the second most cited barrier to increasing investment in China (38% of respondents), behind transparency and fairness of the regulatory environment. It is important to note, however, that industries differ widely about their uneasiness with IP protections. Within the technology sector, 49% of companies indicated that IP protections remain an obstacle to additional investment. R&I corporations are not far behind, with 48% reporting IP as a hurdle to investment.

Few empirical studies have examined China’s IP litigation outcomes, in part because the relevant data became available only after 2014. The longstanding notion among U.S. commentators is that the Chinese system systemically discriminates against foreign patent plaintiffs and that this phenomenon is more pronounced outside of large coastal cities. Gaétan Rassenfosse et al. supports this thesis in a paper that looks at how foreign IP litigants are treated by the China National Intellectual Property Administration (CNIPA) in the context of patent applications declared as standard essential to 3G and 4G LTE technology. Based on this subset of cases, the study finds that foreign applicants’ patents are granted between 8.8-9.3% less often than Chinese applicants’ patents and that it takes between 8.5 to 12.6 months longer for foreign applicants to obtain patents than for their Chinese counterparts. Some other scholars, however, have recently challenged the discrimination hypothesis advanced by Rassenfosse.

Regardless of their reasons for discontent, one thing is clear: U.S. firms are making less in China – a trend many industry leaders expect to continue. More than a fifth of respondents indicated that they experienced yearly revenue drops in 2019, up from only 12% in 2017. This drop was even more striking within the R&I group – in which 30% experienced sales declines, and an additional 36% remained flat. Companies in this sector were also the least optimistic about 2020, with close to 40% of firms surveyed not expecting their market to grow this year. Profitability across industries has also plunged to historic lows, with 38% of companies indicating they recorded losses or broke even.

U.S. Investment in China has Steadily Declined

Foreign direct investment (“FDI”) and bilateral trade data also support this reshoring narrative. According to research provider Rhodium Group, U.S. foreign direct investment in China rose to $14 billion in 2019, up from $13 billion in 2018. This number, however, does not tell the whole story. The uptick in investment was mostly driven by projects that had been in the works since at least 2018, including Tesla’s Gigafactory in Shanghai. In contrast, the value of newly commenced (greenfield) projects declined from $2.4 billion in 2018 to $1.4 billion in 2019,  supported by an expansion of GM’s Chinese joint venture. U.S. FDI in China has been falling since approximately 2012 in many industries. For instance, between 2005 and 2011, U.S. firms channeled roughly $1.27 billion per year into machinery. In contrast, they only invested $104 million per year on average in that sector between 2018 and 2019. Likewise, investment in basic materials was $1.84 billion per year on average between 2005 and 2011, but only $321 million between 2018 and 2019.

As U.S. companies have moderated their investments in China, the U.S. has also reduced its imports form the Asian nation, partly as a response to new U.S. tariffs on Chinese goods. Imports of manufactured goods from low-cost Asian countries (“LCA”) into the U. S. dropped for the first time since 2016 in 2019– recording a decline of 7.2% to $757 billion. Last year also marks the first-time imports from LCAs fell as a percentage of domestic manufacturing output since 2011. This contraction has mainly concentrated in China, where exports to the U.S. slid 17% between 2018 and 2019 to $90 billion. This trend has continued into the first few months of 2020. Imports of goods from China fell 29% year-on-year in the first quarter of this year, according to the BEA. Imports of consumer goods from that country shrank by close to 30%, while those of vehicles and automotive components, industrial supplies, and other capital goods diminished between 20% and 30%. This decline has been partially offset by a $31 billion expansion in imports from other LCAs. In particular, 46% of this amount was absorbed by Vietnam, which is also a popular choice for Chinese businesses looking to cut costs. After this shift, China accounted for 56% of U.S. manufacturing imports from LCA’s, down from 67% in 2013.


Vaccines Make the case for International Free Trade

Countries are planning to ban exports of vaccines to supply their own citizens first. That trade policy could have several unintended consequences.

With the pandemic already propagated worldwide and several countries experiencing a new rise in infections, governments are starting to focus on real solutions beyond lockdowns and masks. The most prominent of these solutions appears to be the development of a vaccine to treat the virus. However, such a cure brings with it what is called “vaccine nationalism,” which might end backfiring governments’ efforts to control the pandemic.

Vaccine nationalism refers to the action that some countries that are already producing the firsts trials of the potential vaccine could take if they decide to provide it to their own citizens first and prevent other nations from buying the antibody—the WHO has already requested countries to avoid this measure. The organization considers that no one will be safe if there are still outbreaks in other countries. Therefore, vaccination of a sole community without taking into account other countries will be a short-run solution.

Setting aside the public health implications of vaccine nationalism, the implementation of this strategy might have several trade policy consequences, similar to those affecting any other good subject to an export ban. Politicians could have the best intentions of trying to take care of people in their country with this policy. However, they are just considering the immediate effects of closing their borders to the exportation of vaccines and neglecting to consider the potential long-run impact on the whole community.

The total prohibition against exporting a specific good has the direct effect of reducing the final price of the product itself. In economic terms, holding the supply of the product constant, if the demand goes down due to the impossibility of exporting, the price will go down.

No one could be against lowering the price of a vaccine, because that way, more people will be able to buy it. However, this political intervention of the price does not come at no cost. Prices play a crucial role in incentivizing companies to produce whatever they consider profitable. They will be more willing to invest and hurry up the vaccine development if they know that the investments and efforts they put on it will be paid off in the future. If the price of the vaccine goes down because of the export ban, they might decide to reduce those investments and efforts. A 7.5 billion people market is much more incentive than a 300 million market.

There is also an issue with the efficiency of the economy as a whole when the government decides to intervene in foreign trade. As noted earlier, the prohibition against exporting a specific good decreases the incentive to produce that good. Resources and people will be diverted to the production of other goods and services that are more valuable, given the price reduction of the product that has its exports prohibited. The economy probably had a comparative advantage in manufacturing that product, but that will not be exploited fully anymore. Less efficient industries will increase in size at the expense of the most efficient ones. Therefore, the net effect is a change in the structure of the economy and a reduction of its efficiency.

Likewise, this distortion of the economy will probably happen with vaccine nationalism. A country might be relatively more efficient than another in producing a vaccine, maybe manufacturing it cheaply or with higher quality. However, resources will not flow quickly to its manufacturing if its price is held down artificially. Resources and people will be employed in the production of less valuable products, losing the opportunity to produce more efficiently a vaccine.

Restricting exports also presents an indirect consequence of decreasing a country’s imports through the reduction of its purchasing power. Exports pay for imports, and vice versa. The more a country exports, the more it should import. Conversely, reducing exports undercuts imports. Without exports, a nation cannot import. As any other family must sell some goods or services in order to get the purchasing power to buy something else, a country must export to be able to import. There resides the real gain of foreign trade. Through imports, consumers can get from abroad products at lower prices than domestically or goods that they are not capable of finding at home.

If vaccines are banned from being exported, that will mean that the country will see its imports decrease. No vaccines exported will reduce the possibility of importing, say, more ventilators, or masks. Given the novelty of this virus, countries are almost walking in the darkness. There is no certainty of what works and what does not. What happens if the vaccine ends up not working as expected? The government will see itself in a crossroads, with fewer funds to import from abroad products that it might require with urgency.

Finally, vaccine nationalism could have geopolitical consequences as well. The strategy could increase future retaliation from other countries. If the country that decides to prohibit exports of its vaccine then happens to have problems with its implementation, it will not be able to go to another country to ask for help. Again, there is no absolute solution for a global pandemic. Isolating from the rest of the world is undoubtedly the worst idea. 7.5 billion people looking for solutions is better than just 300 million people.

Banning the exportation of vaccines will bring many unintended consequences and end up being a bad strategy in the long run. Given the public attention that a potential cure for the virus possesses, hopefully, governments will understand that international free trade is the solution.


Mr. Forzani is an MA student in economics at George Mason University.

global supply


COVID-19 is disrupting the operation of global supply chains, causing many businesses (and countries) to rethink where they source their products. Is the pandemic accelerating trends already underway? Were trade policies – both liberalizing and protectionist – inducing some degree of “nearshoring” to avoid tariffs or to focus on regional trade made easier and less costly through free trade agreements?

In the case of the United States at least, the answer may be yes.

How Global Supply Chains Stretched

Supply chains encompass all the people, technology and resources that go into producing a final product or service. Supply “chain” is an oversimplified term as they are not linear; they are more like interconnected networks.

Historically, supply chains were extremely short – you, or maybe your village, were the entire chain. As economies grew more complex, so did supply chains, enabling more firms to specialize. Companies are now able to source from a wide variety of suppliers to reduce costs and improve efficiency.

Advances in communication technologies and transportation made it both inexpensive for products to cross national borders multiple times and easier to coordinate complex activities at a distance. Resources, labor and technological expertise in multiple countries are leveraged as value is added throughout global supply chains. International production strengthened many companies’ competitiveness. Many multinational companies also invested in production overseas as part of their supply chain strategies.

Stretched and Strained

As supply chains stretched, imports became increasingly important in the U.S. American manufacturers rely heavily on imports for the inputs into their American-made goods whether those goods are consumed domestically or ultimately exported.

For many years China has been the go-to for much of this intermediary production, with companies attracted to its large supply of low-wage workers and China’s specialization in certain manufacturing. The concentration of manufacturing in China has led to mounting concern over whether China is competing unfairly through subsidization, market access restrictions, technology transfer and localization requirements. These and other policies have attracted more manufacturing to China and away from both advanced economies like the United States and other low-cost producers in Asia, a trend that may be now reversing.

The COVID-19 pandemic brought this concern into sharp relief, sparking policy discussions over whether U.S. innovators and producers have become over-reliant on China for resources, inputs and final production. But even before the pandemic, the subtext of the U.S.-China trade war was U.S. pressure on companies to reexamine and “rebalance” the structure of their supply and production networks as incentivized by mounting tariffs.

And even before the tariff war heated up, businesses were seeking ways to shorten their global supply chains to reduce their vulnerability to external disruptions such as changes to trade rules, natural disasters, or other crises, according to a 2017 report by The Economist Intelligence Unit and Standard Chartered.

Has Global Value Chain Participation Peaked?

So now that COVID-19 has caused severe disruption to supply chains, the question on everyone’s minds is: will it cause a retreat in participation in global value chains? Or, was participation in global value chains already peaking before the pandemic and if so, will the pandemic hasten the decline?

We can calculate trends in global value chain (GVC) participation using the UNCTAD-Eora Global Value Chain (GVC) Database. Though supply chains and value chains are not exactly analogous, both show the spread of supply networks across countries. A country’s global value chain participation index can be calculated by summing the foreign value added (FVA) and the indirect value added (DVX) content of its exports, and dividing this by its gross exports.

The chart below shows participation in GVCs generally flattened out from around 2010-2012 after dipping in 2008. It does not show a retreat from global supply chain involvement (though India shows a slight decline). COVID-19 renders the future trajectory unpredictable.

Another measure of trends in global value chains is global foreign direct investment (FDI). In this respect, the trends are far clearer. The data show a significant and sharp decrease in FDI since 2008. This may be a reflection of the decreasing rate of return on FDI, as the initial returns to scale for large multinational corporations start to diminish and new local competitors come online.

The expansion of the digital economy is also likely a big factor in shifts away from FDI commitments, as improvements and diffusion of technology allows businesses to provide services without foreign direct investment in a location. A reduction in FDI may therefore show a complete removal of international involvement, or may just represent a shift in the distance and nature of involvement and investments in foreign markets.

Diversification and Regionalization, Not De-globalization

The expansion of global value chains does appear to have slowed from the heady pre-recession era, and direct on-the-ground investment has plummeted. But, just as with globalization in general, it is too early to say whether supply chains as a whole are shrinking, shifting or something else. Companies could be mitigating risk by diversifying supplier relationships and regionalizing supply chains in response to a proliferation of regional trade agreements that removed barriers.

Looking at the United States specifically, there is evidence of both shifts.

As seen in the chart below, the share of total U.S. imports from China have sharply declined. As we might expect, 2017 marks the beginning of a downturn in the share of imports coming from China. The particularly sharp drop after 2018 shows the effects of the U.S.-China trade war, reflecting the increased costs imposed by tariffs. The sustained political risk combined with trade policies prompted businesses to reduce reliance on exports from China in favor of sourcing elsewhere in the world.

Over the same time period, low-cost Asian producers such as Thailand and Vietnam saw an uptick in share of U.S. imports. U.S. companies may be diversifying production relationships away from China and toward other countries in the region, or at least taking advantage of excess production capacity in facilities elsewhere. The increases are significant but not massive in real monetary terms for a single country, suggesting a “don’t put all your eggs in one basket” mentality.

Even the United States’ largest tech companies like Apple, Microsoft and Google have been reportedly exploring similar moves. In their recent re-shoring report, Kearney found evidence that low-cost producers in Asia have been the beneficiaries over the last five years of efforts from U.S. companies to diversify their supplier networks.

There is also evidence that companies are doubling down on natural geographic trading partners through regionalization of supply networks. Mexico’s share of U.S. imports has increased steadily over the last few years, with a particularly sharp increase in 2019 in tandem with the U.S.-China tariff war.

Regional economic integration is not a new policy strategy. Many of the earliest free trade agreements were regional in nature. Under NAFTA, U.S. firms leveraged the complementary assets of our neighbors to the north and south to strengthen the global competitiveness of regionally-made products. As the Bush Institute Global Competitiveness Scorecard shows, the United States, Canada and Mexico are more competitive as a North American region than any other region in the world. The implementation of the U.S.-Mexico-Canada Agreement will provide incentive to reinforce these relationships as U.S. companies think about “rebalancing” their supply networks.

What to Look For

It is still too early to see the real effects of the COVID-19 pandemic or even the US-China trade war in the data on imports and global value chains, predictions notwithstanding.

Global value chains may be expected to remain complex, but could shift to cross borders that are closer geographically as trade increases among regional partners within Europe, North America and Pacific Rim countries. A key indicator for this will be changes in shipping trends. Expert Martin Stopford predicts a decrease in demand for large container ships and an uptick in demand for smaller shipping vessels that are more economical for shorter routes.

Before the pandemic, global supply chain expansion was not increasing at the speed it once was, but reports of its demise are premature. Instead, companies are thinking about diversification for improved resilience without sacrificing the benefits of a global and interconnected system of international trade.

Meanwhile, hopes for American reshoring may be equally overblown. The United States has obstacles to overcome, including a shortage of skilled labor and high production costs. Nonetheless, companies will have to assess whether a cost-above-all-else approach to manufacturing and sourcing is sustainable in a post-pandemic global economy.


Alice Calder received her MA in Applied Economics at GMU. Originally from the UK, where she received her BA in Philosophy and Political Economy from the University of Exeter, living and working internationally sparked her interest in trade issues as well as the intersection of economics and culture.

This article originally appeared on Republished with permission.

Global Diabetes Care Devices Market Report

The revenue graph of the diabetes care devices market has been witnessing considerable momentum in recent years owing to the increasing usage of self-monitoring blood glucose and insulin delivery devices. Obesity, smoking, genetic mutations, a sedentary lifestyle, unhealthy diet have led to an escalation in the number of diabetes patients. The occurrence of diabetes is gradually rising, such that more than 1 in every 10 adult individuals or 12.2% of the U.S. population aged 18 years or older is affected with it. Diabetes is considered as the seventh leading cause of death.

According to WHO, 422 million adults globally are diabetic patients, 1.6 million deaths are directly attributed to diabetes each year and 1 in 3 adults aged over 18 years is overweight and 1 in 10 is obese. In essence, all these statistics demonstrate the rapid growth in the number of diabetic patients which has driven the growth prospects of the diabetes care devices industry. According to a research report by Global Market Insights, Inc., the revenue portfolio of the diabetes care devices market will exceed USD 41.5 billion by 2025.

Diabetes is increasing among adults as well as children due to the prominence of an indolent lifestyle. In 2016, 41 million infants and young children were reported to be obese or overweight, 124 million children and adolescents were obese which counts to be a tenfold increase in the last four decades and nearly 1 in 5 children and adolescents are overweight or obese. Obesity is the primary cause which has led to the prevalence of diabetes as almost everyone prefers to enjoy an unhealthy lifestyle without realizing the significance of physical wellness. As per the Pan American Health Organization (PAHO), around 305,000 people died due to type 2 diabetes in America in the year 2014.

Increasing count of deaths due to diabetes has intensified the sales of diabetic care devices. The latest technologies and devices are being preferred over traditional techniques due to their ability to deliver accurate results. Launched recently, Senseonics’s Eversense Continuous Glucose Monitoring (CGM) system is one such unique and revolutionary device. Termed as the first implantable device to measure glucose level, Eversense CGM has received approval from the U.S. Food and Drug Administration (FDA) which is being touted as a groundbreaking step forward in the dynamic diabetic management world.

The device uses a unique light-based technology to send glucose level data to an app on cell phone, warning patients about their rising or dropping glucose level. It can be worn up to 90 days which is impressive as Dexcom and Medtronic’s sensor technology can be used for up to 10 days only. Eversense CGM is one of many innovations unveiled by medical device makers to check on diabetes and demonstrates the enormous growth opportunities being opened up for the diabetes care devices industry.

Numerous innovations in the healthcare sector have ensured that several options and product ranges are available to keep a check on diabetes. Many of these are in the pipeline and are awaiting regulatory approval. For instance, a ready-to-use glucagon emergency pen by Xeris Pharmaceuticals is awaiting regulatory approval from FDA depending upon the meeting in June 2019. Apparently, there are a number of devices in the early production phase or are seeking FDA approval – a factor that would benefit the growth prospects of diabetes care devices market.

Moreover, myriad studies are being carried out today to find out new approaches to manage diabetes. For instance, the Juvenile Diabetes Research Foundation (JDRF) is a non-profit organization which offers funding to cure type 1 diabetes (T1D). The organization has invested over $2.2 billion in research funding since its inception. A T1D patient Lindsey Redepenning is a commendable example of recovery through Medtronic 670g Artificial Pancreas hybrid closed-loop system developed with the contribution of JDRF. Implantation of artificial pancreas is a new technology that effectively helps in curing T1D by releasing insulin in with changing blood glucose levels in a similar way to a human pancreas.

In a nutshell, rising number of R&D investments and consistent efforts of non-profit organizations like JDRF will propel diabetes care devices market share. Additionally, the launch of technologically-superior and highly efficient blood glucose measuring devices is likely to assist the diabetes care devices market in registering exponential growth in the times to come.

Source: Global Market Insights

medical electronics

Global Medical Electronics Market Report

Medical Electronics Market size is set to cross US$ 169 billion by 2025 with13% CAGR confirms a recent research report by Global Market Insights. What can only be construed as an innovation that may impact India’s medical electronics industry to quite an appreciable extent, Philips, a renowned brand across the electronics sector, has recently launched two new diagnostic instruments, namely, MobileDiagnost Opta and BV Vectra in India.

The former, a digital X-ray system, has been designed to find extensive applications in intensive care units and operation theatres. BV Vectra, on the other hand, is a mobile C-arm system that is anticipated to be used in orthopedic surgeries. With the presence of three major electronic equipment manufacturers – Siemens, GR, and Philips, and their objective to manufacture the contemporary ‘Made-in-India’ medical devices, it is anticipated that India’s medical electronics market will experience lucrative growth in the years ahead.

Bringing forth a slew of product innovations in the market has been touted as a major growth strategy for businesses, particularly in the medical electronics industry, given the robust requirement of the healthcare space to enhance operational efficiency and lower medical care expenditure. Kinpo Electronics Incorporation, for example, has recently received the EU certificate that approves its newly launched wearable ECG monitor, called the BC1 patch that apparently helps in the prevention of cardiovascular disease. The medical certification allows the firm to promote BC1 within the European Union.

Kinpo expected to commence product marketing in key European countries by the third quarter of 2017 under its own brand referred to as XYZlife. The device provides real-time monitoring, data pertaining to medical history, and authentic medical reports, in addition to encompassing an exceptional function that helps users to contact physicians during emergencies. Experts cite that the BC1 patch is likely to prompt industry rivals to introduce similar products in the market, which would undeniably impel the product landscape of the medical electronics industry.

Recently in 2017, Mackenzie Health, a renowned healthcare service provider based in Canada, had collaborated with Epic systems corporation, a U.S. based software developing firm, to introduce a new end-to-end electronic medical record system in Canada. The innovative tool assists medical practitioners in the decision-making process and facilitates speedy access of medical health records, in addition to providing improved medication safety and minimizing error occurrences related to closed-loop medication administration & bar code authentication. This medical system is the first of its kind launched across the country and is predicted to have a sizable impact on the U.S. medical electronics industry, which apparently held more than 90% of the overall revenue share in 2016.

The competitive landscape of the medical electronics market has witnessed numerous M&As for the last few years. In fact, recently, Becton, Dickinson and Company, a leading player across the medical technology industry, has declared the acquisition of Caesarea Medical Electronics, a key Israel based player across the infusion pump systems industry.  The acquisition will help the former expand its infusion pumps product portfolio, thereby facilitating the firm to strengthen its position across the medical electronics market.

The U.S. has been singled out as one of the most profitable growth avenues across the North America medical electronics industry, subject to the large presence of major manufacturers in the region and the extensive deployment of advanced technology. The wide insurance coverage provided under the Affordable Care Act and the appreciable improvements in healthcare infrastructure facilities across the region are certain to provide a positive impetus to U.S. medical electronics market.

Some of the firms partaking in the medical electronics market share include Toshiba Corporation, Siemens, GE Healthcare, Medtronic Public Limited Company, and Phillips. Most companies have been reported to be adopting new strategies to expand their business scope, contributing extensively to medical electronics market revenue.  Considering the developments that the medical electronics industry is replete with, it comes as no surprise that the medical electronics market is slated to hit a revenue margin of over USD 169 billion by 2025.


wearable medical device

Global Wearable Medical Device Market

The global wearable medical device market size is expected to exceed more than $87bn by 2025; Growing at a CAGR of more than 39.4% in the given forecast period.

The increasing convergence between wearables and medical products has proved beneficial in transforming wearable medical devices market outlook. Having emerged as one of the most profitable niche verticals in the worldwide healthcare and medical devices sector, this industry is not yet a mainstay in the field, but most medical device manufacturers are nevertheless adding wearable components to their product lines. These fitness trackers help users to stay in shape, all while being easy to use, comfortable, and not cumbersome.

The foremost factors that have led to the increasing popularity of wearable medical devices are active promotion and growing expenditure on advertisement of these devices, essentially enlarging the geographical reach of wearable medical devices market. Amongst all the existing wearable medical devices, activity/fitness monitors have witnessed meteoric rise in their popularity owing to the technological advances in battery, sensor, and material design.

What will be the impact of the popularity of fitness monitors on wearable medical devices market outlook?

In the year 2018, fitness monitors segment accounted for more than 25% of wearable medical devices market share and is projected to observe significant growth by the year 2025. Activity monitors help to keep track on fitness-related metrics including walking distance, sleep (in some cases), heartbeat, and calorie consumption. Sedentary lifestyle has led to disorders such as obesity and other chronic conditions, a need to prevent which will help to fuel activity monitors segment growth over 2019-2025. The growth of activity monitors segment will simultaneously augment wearable medical devices industry by 2025.

Wearable medical devices market to accrue substantial profits from fitness and sports sector by 2025

Wearable medical devices market forecast report compiled by Global Market Insights Inc. projects that global revenue of the industry slated to exceed $87 billion by 2025. The proliferating union of medical products and wearables has proved favorable in transforming wearable medical devices market trends. After emerging as one of the most lucrative niche verticals in the global healthcare and medical devices sector, many medical device manufacturers have been including wearable devices in their product lines.

In terms of geographical expansion, the U.S. wearable medical devices market has witnessed considerable growth and is anticipated to reach more than USD 23 billion of revenue by the year 2025. The most significant factors that have proved beneficial for the market are the launch of technologically advanced healthcare monitoring products along with rising awareness regarding fitness. High disposable income and growing prevalence of lifestyle diseases would further proliferate the U.S. wearable medical devices industry size over the forecast duration.

The largest obstacle that is hindering the rapid product penetration is the concern regarding data privacy. Most users appear uncomfortable with an AI-based sensor or other miniaturized electronic device keeping a record of their every movement. Even though there has been a considerable increase in the number of people allowing these devices to become a part of their daily life, there is still a long way to go for wearable medical devices to become mainstream.

It is imperative to take note of the fact that the healthcare sector used to function in a siloed structure for the safeguarding of intimate patient data. However, now that they have emerged out of those silos, the protection of user data has taken even more priority, essentially marring the growth prospects of wearable medical devices market.

The major industry players are involved in adoption of several strategies including merger and acquisition, strategic collaboration, and partnerships to strengthen their business position. A few of the players operating in wearable medical devices market are Fitbit, Sotera Wireless, Omron Corporation, Koninklijke Phillips N.V. Apparently, these firms are focusing on untapped emerging nations to gain competitive edge and acquire significant market share globally. Reports forecast that the remuneration portfolio of worldwide wearable devices market is set to surpass USD 87 billion by the year 2025.



Partnering to Help Children in Tanzania to Survive Cancer

A donation from leading temperature control packaging company Softbox Systems has enabled the charity International Health Partners (IHP) to deliver cold-chain oncology medicines, giving children in Tanzania the chance to recover from cancer.

The recent donation of a temperature control pallet shipper enabled IHP to send cytotoxic (chemotherapy) medicines to TLM, its aid partner in Dar es Salaam. These were used to treat Kanoni, a two-year-old patient, who is now free of cancer.

Last December, Kanoni was admitted to the hospital with a huge abdominal mass and severe pain. A CT scan and tests revealed that she had a kidney tumor. “When the lab investigated, it found her cancer was high-risk, and she needed medicine that could only be transported through cold-chain packaging,” explained Colleen Harrisson-Dodds, Logistics Director for IHP.


Previously, IHP and Softbox Systems have collaborated to send more than 2,000 treatments to Tanzania. Softbox donated its award-winning Silverpod pallet shipper, which enables the shipment of bulk consignments of goods, and can maintain product temperature stability for up to 120 hours.

Kanoni completed her treatment last month, and scans show the cancer has gone. “We’ve seen a remarkable improvement in her condition,” said Lilian Nydyetabula, the chief operating officer of TLM, which helped establish Tanzania’s first pediatric oncology service. “She gained weight and was able to move around and play with other children. Now, Kanoni is a totally different child from the one who arrived last December.”

Softbox Systems is a market leader that has won acclaim for its emphasis on high performance, sustainable and user-friendly packaging solutions. “It’s a pleasure to support IHP and rewarding to know that our packaging systems enabled the safe transportation of Kanoni’s life-saving treatment,” said Clive Bryant, Global Product and Marketing Director at Softbox Systems. “Our award-winning Silverpod range means that temperature-sensitive medicines arrive in perfect condition and ultimately save lives. We’re always looking for ways to enhance our products to facilitate the successful delivery of life-saving medicines all around the world.”

IHP is a leading coordinator of donated essential medicines, working with healthcare companies, logistics providers and aid agencies. Adele Paterson, CEO, said: “This is a wonderful example of the way we partner proactively. We’re delighted to work with Softbox Systems to enable the delivery of high-quality medicines to vulnerable people.”

wellness medical bed market

Report: Medical Bed Market

The global geriatric population is on the rise with the population aged over 65 years set to outnumber children under the age of 5 years over the coming years. Older people are generally more susceptible to infectious or chronic ailments, mostly due to age-related deterioration of the immune system. This vulnerability to various health risks including contagious and chronic diseases, as well as injuries associated with falls and physical disabilities is likely to add impetus to the global medical bed market.

The surge in the occurrence of chronic ailments is also causing a rise in hospitalizations for accurate and effective patient care. This upsurge in tandem with rising disposable incomes and rapid healthcare infrastructure advancements are promoting the widespread acceptance of medical beds on a global scale.

Several favorable healthcare policies and mandates have been enacted to ensure the availability of proper and effective medical care to those in need. For instance, in March 2017, the Indian government released a healthcare reform that requires healthcare facilities to have a minimum of 2 beds per 1000. This means there will be nearly 2,623 beds over the coming decade, including new as well as replacement beds.

Elderly population growing at a rapid pace

The older generation, or the “baby boomers”, account for a large chunk of the global population, and rising. In 2019, the number of individuals over the age of 65 years was recorded at nearly 703 million. This number is set to double by 2050 to reach 1.5 billion.

Most frequent users of the Emergency Department or ED services are elderly people suffering from one or more chronic ailments. Common maladies associated with old age include cataracts and vision deterioration, hearing loss, back, neck pains and osteoarthritis, diabetes, cardiovascular conditions, dementia, and depression, among others. As a result of this, the demand for effective and adequate emergency services has been growing extensively of the past year, proliferating the requirement for efficient healthcare equipment, including medical beds.

The growing elderly population has also brought about the establishment of dedicated geriatric healthcare facilities like Athulya Assisted Living, the brainchild of Karthik Ramakrishnan. The facility, located in Chennai, is considered a premium assisted living center and features myriad advanced healthcare provisions including sophisticated ECH machines, assisted medical beds as well as trained healthcare staff.

Rising occurrences of chronic ailments and subsequent rise in hospitalizations

The rapid expansion of the elderly population is also leading to a higher prevalence of chronic health conditions such as diabetes, cancers, cardiovascular ailments, stroke, and respiratory ailments. This increase is likely to assert pressure on healthcare systems to be able to provide adequate care and treatment to these patients.

In 2017, emergency department visits from patients suffering from at least one chronic condition accounted for nearly 60% of the cumulative annual visits, incurring an expenditure of nearly $8.3 billion.

Furthermore, over 90 million U.S residents suffer from at least one chronic condition, with seven out of 10 individuals succumbing to a chronic ailment. These numbers indicate a strong need for effective medical equipment including sophisticated medical beds.

While there are several healthcare systems put in place for the treatment of acute medical issues, many facilities are not equipped to deal with chronic ailments and long-term care. Given the prolific rise of chronic disease cases, medical bed industry players are taking consistent efforts towards developing revolutionary healthcare solutions geared towards long-term treatment.

The emergence of new healthcare technologies

For hospitalized patients, hospital bed security is characterized by sporadic visits from nurses and doctors. Due to this, any potential decline in the patient’s clinical condition may go unnoticed for a period of time, causing a delay in treatment administration and increasing the risk of mortality or morbidity.

However, in recent times, many up and coming technologies are coming into existence, designed to combat this issue and mitigate risks associated with hospitalization.

In fact, the digital healthcare sector is expected to hit $536.6 billion by 2025.

One of the most prominent advancements in the medical bed industry is brought forth by Hill-Rom, a multinational medical technologies provider and the foremost hospital bed producer in the world. Hill-Rom has unveiled a new technology called EarlySense, designed to integrate with Hill-Rom’s Centrella Smart+ bed platform and provide continuous, contact-free monitoring solutions including heart and respiratory rate sensing and analytics system.

Additionally, a new study published in an American Society for Microbiology journal has revealed that using copper as a component in ICU medical beds would harbor an average of 95% less bacteria than conventional beds, ensuring low-risk levels among hospitalized patients.