Industry trade

President’s statement on the principles of supply chain resilience

Today (October 31, 2021) the United States, the European Union, Australia, Canada, the Democratic Republic of the Congo, Germany, Indonesia, India, Italy, Japan, Mexico, the Netherlands, the Republic of Korea, Singapore, Spain and the United States Kingdom met to discuss short-term supply chain disruptions and pathways to long-term resilience . Secure, sustainable and resilient global supply chains are essential to our economic prosperity, national security and collective interests. Countries have expressed their intention to work together to strengthen the resilience of our supply chains – the global ecosystem of raw materials, intermediate goods, manufacturing, logistics, research and development that ensures our businesses and our consumers get the products they need. Secure, sustainable and resilient supply chains require that we work in partnership, not only as governments, but also with industry, unions and workers, civil society and international organizations. Whether responding to acute shocks of the kind we see in global trade today or addressing chronic long-term challenges in sectors critical to our security, more resilient global supply chains are essential for sustainable economic development for all.

We discussed strengthening four key pillars of global supply chain resilience:

  • Transparency: Improving transparency and information sharing between countries will help all countries mitigate and respond to global supply chain shocks; this includes working with businesses to understand their own vulnerabilities. Transparency of supply chains with regard to raw materials, intermediate and finished products should be a key value of the industry. Transparency in supply chains promotes awareness of risks and potential shortages, identifies bottlenecks, and helps organizations determine whether other sources of critical inputs are needed. This kind of openness and communication can foster a rapid response to disruptions in supply chains, such as those facing the world today, and enable other actors in a supply chain to take mitigating action. Transparency also allows consumers to make informed purchasing decisions and businesses to effectively serve their customers. It is also a condition for a sustainable management of the supply chain.

Transparency at the government level helps to share information and ideas on supply chain challenges, and helps government consider actions that could improve our collective supply chains. Fostering greater supply chain transparency, compatible standards and information sharing, in accordance with national laws, between countries can further mitigate and respond to global supply chain shocks. By recognizing these principles, our countries express their intention to cooperate to identify additional transparency measures and to work collaboratively with the private sector on such measures. We also stress the importance of transparency regarding government actions to strengthen supply chain resilience.

  • Diversity, openness and predictability: Open global markets are essential to support resilient supply chains. Countries have expressed their intention to work together to ensure that we have multiple reliable sources of raw materials, intermediate goods and finished products that rely on resilient supply channels. We recognize that the diversity of supply fosters a sustainable global market, where everyone has a role to play in promoting a shared advantage.

The diversity of global suppliers not only fosters resilience, but also fosters interdependence and shared prosperity. We must avoid unnecessary trade restrictions and maintain the free movement of goods and services, in accordance with the principles and objectives of the rules-based multilateral system, and work together to address existing restrictions affecting our collective supply chains. We must also foster competitive and dynamic supply chains that resist monopolization and offer alternative choices for materials, goods, production and distribution. The diversity of supply also protects against acute economic vulnerability resulting from the concentrated control of a single source and protects the ability of each country to make its own sovereign decisions and to enable governments, industry and the community to make their own choices about the sources and procurement of goods.

Predictability is important for reliable supply chains and we will work together to promote predictability in our business relationships as they impact our supply chains. We will strengthen and foster our long-standing economic partnership and supply chain relationships.

  • Security: Countries discussed that security should be recognized as a high priority for all actors in supply chains, especially in technological supply chains, at critical infrastructure nodes and at other points in the pipeline. supply chain that must not fail. Addressing security vulnerabilities can prevent damage or disruption that interferes with critical systems or infrastructure, or contributes to unnecessary costs, inefficient delivery schedules, loss of intellectual property and assets, or delivery of unauthorized or compromised products. It is important that governments work with industry to better understand and manage security risks to supply chains.
  • Durability: Governments, industry and civil society should work together to promote and accelerate the global sustainability goals, including the implementation of the Paris Agreement on climate change and international labor and workers conventions, the optionally. Creating fair and sustainable working conditions strengthens our supply chains, leading to a more innovative and productive industry and greater shared prosperity. Harmful practices that violate international rules and standards must be eliminated from our supply chains and we urge the implementation of business practices consistent with the United Nations Guiding Principles for Business and Human Rights and other relevant international guidelines, if applicable. Likewise, investing in and mainstreaming climate and environmental sustainability, and developing clean energy supply chains is good business, as well as good policy, as one of the main drivers of business chain disruption Supply are extreme weather events that have worsened and more frequent due to the climate. change and the dependence of our economies on nature.

As partners in promoting secure and resilient supply chains, countries discussed collaboration and with the private sector to address critical supply chain challenges:

  • Improve information sharing and transparency: Countries have expressed their intention to step up efforts to share information on the potential, emerging and systemic supply chain.s bilateral and multilateral challenges, so that we can work collectively to address them, including mechanisms to improve early warning of disturbances. We will strive to share best practices for dealing with port congestion and current supply chain disruptions. This work will be undertaken in accordance with market principles.
  • Sustainable development: Countries have expressed their intention to expand cooperation, information sharing and consider co-investment for responsible access and development of raw materials and key inputs, and we will encourage and support manufacturing and sustainable trade in products needed to combat climate change and other international sustainability goals.
  • Security of supply: Countries have expressed their intention to consult to address potential shortages and cooperate to address shortages that could potentially impact our countries, while maintaining open markets.

We invite all economies that share these principles, businesses and non-governmental organizations to join us in pursuing this shared vision of resilient supply chains, guided by these principles. Recognizing the need for the participation of industry, unions, workers and other stakeholders, we expressed our interest for relevant ministers from our governments to convene an inclusive multi-stakeholder meeting on chain security and resilience. supply in 2022.

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