The Dangers of Unregulated Global Supply Chains

I like what Neil Shister, Editor of World Trade Magazine, has to say about the the dangers of operating in unregulated supply chains. Unlike many who've jumped on the anti-China bandwagon, Neil takes a far more objective perspective, noting that "the underlying issue -- the sheer complexity of supply chains folding in upon themselves like strands of DNA -- pertains to places other than China. Even the best intentioned, most responsible final 'brand' manufacturer is multiple levels removed from the original source of components or basic ingredients. And the bigger the company, the better the odds that much of that stuff is coming from outside the U.S." And as well already know, this is "an endemic problem that puts aspects of the global supply chain at potential risk."

While I agree with Neil, I'd also suggest that increased government regulation of global trade is not the answer. Yes, industry associations and standards bodies should play roles. But ultimately, markets will demand accountability (and end markets will pay a premium for it). Restricting trade or subjecting products from certain countries to added import requirements is an answer that will hurt those seeking to benefit from the import of cheap products in the first place. Seriously, in my view we're realizing the current backlash because we're getting exactly what we asked for from our trade with low cost countries. Now, it's time for all of us to ask for more. And we better be willing to pay for it.

Jason Busch

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