As shown by COVID-19, we cannot predict when a crisis will hit us- at least not all the time. However, we must ensure that we can manage the supply chain during the disruption from natural disasters or actions by foreign adversaries or powers. As it stands now, the American supply chain is vulnerable to most of these. For this reason, President Biden is vowing to direct his energy towards ensuring the supply chain risks are addressed. Making the supply chain secure and efficient can also be a source of well-paying jobs for communities across America, including people of color.
The Executive Order signed by President Biden on the 21st of February is a crucial step towards securing the supply chain against various risks. The Executive Order directs federal Departments and Agencies to find ways of securing the US supply chains against risks and vulnerabilities. The resilience of supply chains will protect the country from future shortages of critical products. It will further America’s competitive edge and strengthen national security, critical for any industry and individual.
The executive order directs a review to be carried out across all federal agencies within 100 days to find supply chain vulnerabilities for four key products: APIs, critical minerals, semiconductors and advanced packaging, and large capacity batteries such as those used in electric vehicles. In recent years, most API production facilitators (over 70 percent) that supply the US have moved offshore. This has left the country vulnerable. Similarly, minerals needed for the country’s defense and manufacturing have not been secured as needed. Within the 100-day review ordered by the President, the federal government will identify the vulnerabilities in these areas and design the near-term solutions that are needed to address the risks and vulnerabilities.
The order further calls for a comprehensive one-year review of a broader supply chain set within the US. The focus will be on six major sectors: the defense industrial base, information and communications technology, energy sector, transportation industrial base, agricultural supply chains, food production, public health, and biological preparedness base. The White House seeks to identify critical goods and materials needed in the manufacturing or production of other materials, manufacturing locations, and the availability of substitutes or alternative sources for critical products or items that can fill gaps in case of problems in the supply chain. Agencies are required to make specific policy recommendations that will address risks and give proposals for research and development activities.
While at this, the government must work in collaboration with others. This involves partnering with the external stakeholders and the American people. The Executive Order directs the government to consult widely with other stakeholders such as those in academia, NGOs, labor unions, territorial and tribal governments.
From all these, one thing is clear, the security of the United States is tied to the supply chain. Therefore, how we protect our supply chain is up to the policy-makers and everybody else. The Executive Order is the first step of identifying the opportunities to implement policies that will help secure supply chains, which are the backbone of American success.