Global Supply Chain Forum Discussions, No Action

While Federal Industry and Science Minister Ed Husic said this week’s virtual Global Supply Chain Resilience Forum was the largest multilateral forum working on long-term strategies to strengthen supply chain resilience, no action emerged from the meeting.

The forum brought together UK, Korea, Singapore, Indonesia, Japan, India, Canada, Mexico, Brazil, EU, France, Germany, Netherlands, Spain and the Democratic Republic of Congo. US Secretary of State Antony Blinken and US Secretary of Commerce Gina Raimonda moderated the meeting.

“Collaborating with international partners is key to building more resilient, transparent and diverse global supply chains. This is why Australia must work with like-minded countries to ensure access to essential goods and services, especially in times of disruption,” said Minister Husic.

Husic said the government is committed to responding to views raised by forum stakeholders.

The forum took place at a time when the United States faces the potential risk of massive supply chain disruptions as a labor contract between the International Longshore & Warehouse Union (ILWU) representing coastal dockworkers west and the shipping companies, represented by the Pacific Maritime Association (PMA) expired on July 8 without any new agreement being reached.

The west coast handles about 60% of imports from Asia as well as the country’s exports.

The National Manufacturers Association of the United States said a 15-day port disruption would cost the country an estimated $10.8 billion, with 41,000 people losing their jobs, including more than 6,000 in manufacturing and 15 000 in retail.

The situation is so critical that President Joe Biden and Labor Secretary Marty Walsh have met with the parties to negotiate an agreement that the work stoppages will not occur while the ILWU and PMA strike a deal.

At the forum, Husic highlighted the importance of having both a national and international approach to addressing tensions in the global supply chain, and the role of governments to step in and support businesses and workers where the supply of essential goods and services is likely to be significantly reduced. disturbance.

“The voices of business, labor and community groups are at the heart of these discussions as they are the first line of defense in keeping supply chains running smoothly,” he said.

In a report last November on the impact of the global logistics crisis on Australia’s container trade, the Australian Competition and Consumer Commission said the Australian industry was feeling the pressure and the costs, and was vulnerable to the impacts.

The ACCC pointed out that a recent study by the World Bank and IHS Markit showed that even before the Covid disruptions, Australian container ports were “relatively inefficient and well below international best practice”.

“The study ranked Australia’s largest container ports, Melbourne and Sydney, in the bottom 15% and 10% respectively of the 351 global ports in the study,” the ACCC said.

The report says data released by the United Nations Conference on Trade and Development showed that in 2019 the median time in port for container ships visiting Australia was three times longer than Japan, twice longer than China and 50% longer than Singapore. or New Zealand.

“We were told that some shipping companies were already withdrawing their services from Australia before COVID hit. Australia must take decisive action to remain an attractive destination for global shipping companies,” said Rod Sims, then ACCC Chairman.

The report also looked at workplace practices, saying systemic industrial relations issues and restrictive labor practices have further disrupted the supply chain and exacerbated congestion and delays.

“Data obtained by the ACCC shows that the average number of idle hours, which is the amount of time a vessel spends at berth, at Port Botany has fallen from 11.9 hours before the pandemic to 21.2 hours. in 2020-2021. Congestion at Port Botany has become so severe that some shipping lines are skipping the port altogether,” it said.

Sims said industrial action on top of existing congestion is putting “tremendous pressure on our international container ports at a time when they can least cope with it, and in the case of Port Botany some shipping lines have decided delays in commercial use of the port being unviable,” Sims said.

“Longstanding labor issues in the container securement industry have led to lower productivity and higher costs for Australian freight owners,” he said.

Husic said resilient global supply chains enhance nation prosperity, security and well-being.

“[This includes] the need to ensure an adequate workforce in times of crisis, the essential role of public procurement in strengthening and diversifying supply chains, and the need for substantial public-private partnerships to build the critical resilience of the supply chain,” he said.

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