War, pandemic drive companies to shift supply chains, WTO chief says

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The war in Ukraine — coupled with the pandemic’s chronic supply chain snarls — has persuaded manufacturers to cut their reliance on China and spread factories across a wider array of countries, the director general of the World Trade Organization said.

of Ukraine has blocked shipments of grains and fertilizer for two months, sending commodity prices soaring, and has triggered tough U.S. and allied financial sanctions that have isolated Moscow. Hopes of improved supply chain performance this year, meanwhile, were dashed by freshoutbreaks in China, where the government’s zero-covid policy prompted lockdowns in Shanghai and other commercial hubs.

“They’re trying to manage risks, and they want to de-concentrate manufacturing. They’ve seen that manufacturing of certain inputs and outputs are too concentrated,” she told a small group of reporters in Washington.The supply line shake-up — which Okonjo-Iweala bills as “re-globalization” — probably would come at the expense of China. But it could be a boon for some developing countries.

 

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This should have been common sense from the start. never put all your eggs in one basket, particularly one's critical to your economy, and national defense.

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