The end of the last century heralded the third wave of industrialisation that led to the globalisation of manufacturing. Rapid advances in information technology and global connectivity made for the seamless integration of design, the sourcing of raw materials, labour, capital and manufactured components across multiple locations. The rapidly evolving ecosystem created networked global supply chains located wherever comparative advantages made them most cost effective. The world shrank. Emerging economies betting on low labour costs became the world’s sweat shops, but prosperity also spread. So did entrepreneurship. Asia became the centrepiece of this boom and China the world’s factory. From a 5% share of the world’s manufacturing in 1995, by 2011 China’s share had climbed to 27%.
The process also saw the same low cost economies develop competitive manufacturing and management capabilities as they became part of global supply chains. Wages in emerging economies rose, working conditions improved. Increasing prosperity began transforming them into markets for the goods they began by initially manufacturing for the developed world.