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A look at the possible implications of President Biden’s order to review critical supply chains on the United States’ relations with its trading partners, with Jeff Weiss, partner and co-chair of the International Trade Policy Practice, and leader of the Supply Chain Team, of Steptoe & Johnson LLP.
Biden’s executive order is “significant” by its very nature, Weiss believes. “This is the first serious U.S. government-wide attempt to come up with a supply-chain strategy, and they’re doing it in their second month in office,” he says. Weiss sees the action as a shift by government from a reactive to proactive approach to supply-chain disruptions. What’s more, it encompasses more than just logistics, extending to issues of manufacturing and end-to-end supply chains. “Potentially, this could be groundbreaking,” he says.
Initially, the order calls for review of four key supply chains: semiconductors, large-capacity batteries, pharmaceuticals and rare earth materials. At least six additional sectors will be added over the course of a year. Weiss says the effort is meant to address more than just the coronavirus pandemic, which in many ways in responsible for the crisis that the supply chains under study are currently facing. And while each has its individual problems, all stand to be affected by “cross-cutting” issues such as climate change, cybersecurity and transportation gridlock.
Transportation is an especially vital area of focus, given the recent heavy congestion at the ports of Los Angeles and Long Beach. That’s nothing new to Weiss, who has deep experience in helping to fashion trade and transport policy. Slowdowns in Southern California “happen every couple of years,” he says.
Putting into practice the ultimate recommendations of the exhaustive review process will require a close partnership between government and the private sector, Weiss says.
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