cryptogon.com

Gou founded Foxconn in Taiwan in the 1970s, and moved manufacturing away from the island republic to Shenzhen at the end of the 1980s. Now, he is beginning to reverse the process. Moreover, Gou is committing even more funds outside China. For instance, Foxconn will soon open facilities that will employ another 10,000 workers in Brazil. At the same time, he is negotiating with authorities to commit as much as $10 billion to factories in Indonesia.

And then there is the good ole U.S.A., where Foxconn already makes server parts in California and Texas. Said Louis Woo, the spokesman, “We are looking at doing more manufacturing in the U.S. because, in general, customers want more to be done there.”

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Why should Gou leave the country that made him rich and famous? There are, for starters, spiraling wages, worker discontent, forced unionization, tough environmental enforcement. But the big factor today—and the one no one thought about three years ago—is political risk. Beijing wants territory controlled by its neighbors and, as a result, China is getting itself into nasty scrapes, especially with Japan. Moreover, the Chinese have designs on the sovereign state of Taiwan, which they consider their 34th province. For IT companies, China’s friction with these two countries is a problem because many of their products rely on Japanese and Taiwanese components.

And the Chinese have not only gone after neighbors. Since late 2010, Beijing has sought to punish American, European Union, and Norwegian companies for perceived misdeeds of their governments. In Norway’s case, it was the award of the Nobel Peace Prize to dissident Liu Xiaobo that started a multi-year Chinese war against salmon imports from the Scandinavian country.