Inside Out | US-China trade: why protectionism is no fix for global supply chains
- A global shortage of PPE early in the pandemic brought home how interconnected the world is, and how vulnerable its supply chains are
- The answer is not stronger domestic production but, rather, flexible multilateral collaboration
Cindy Shiner, at the heart of USAid’s Global Health Supply Chain project, spoke for millions last month when she wrote on a leading UN-supported website: “One thing the COVID-19 pandemic laid bare was just how connected communities around the world are to one another. It’s important to use those links for global, and individual, advantage to prepare for the next crisis.”
Thus, she said, “there must be greater collaboration between all stakeholders, including suppliers, customers, logistics providers, and others, to build holistic solutions across supply chains”.
All so true, and all so completely ignored. Which is tragic, since it will leave us ill-prepared for the next pandemic and – even more tragic – rob us of an opportunity to rehearse the multilateral cooperation that will be essential if we are to tackle the climate crisis.
Instead of international collaboration, we have seen export bans, a surge in economic nationalism and a collapse in cooperation as governments worldwide have hunkered down and striven to face the huge pandemic recovery challenge alone.
Instead of spending billions on building foundations for global cooperation to ensure resilience when the next global health crisis erupts, governments have spent trillions on building domestic production defended by protective walls and subsidies, growing local employment, reducing dependence on foreign suppliers perceived to be untrustworthy, and building expensive inventories.
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US company stuck with 30 million locally-made N95 masks it can’t sell
A clear illustration comes from a fascinating working paper released last month by Chad Bown at the Washington-based Peterson Institute for International Economics on how the bad management of supply chains worldwide resulted in perhaps millions of unnecessary deaths, and billions of dollars of preventable costs.