“How is this capital flight?”
The Capital Stock of a country is the whole of the means of production, not just the profits from it.
Just like when GM makes cars in Mexico. The profits go to GM in the US, but the bulk of the national benefit goes to Mexico in investment capital, jobs/wages (and supporting jobs/wages)and taxes which supports roads and other infrastructure.
The largest increase in overall capital stock goes to Mexico.
China will not allow a wholesale movement of capital stock to Vietnam, the only country they’ve had war with since WWII. And it’s because they are practiced and committed mercantilists.
They mimic the US circa 19th century.
Thank you for expanding my understanding of production economics.