A combined term that is created from the two words “ally” and “off-shoring”. It refers to a situation where two countries or more, with shared values or political vision/ objectives, (a group of countries) relocate supply chains within the group. This involves manufacturing and sourcing from geopolitical allies, across the globe.
The aim for such alignment stems from the shared values or vision, rather than real economic fundamentals. Therefore, allyshoring may create cost-ineffectiveness, inefficiencies, and duplication. However, specific countries or companies in such countries use this tactic as a way to experiment and assess international markets and supply chains while attempting to mitigate certain geopolitical risks.
It is also known as an friendshoring.
