MNI INTERVIEW: Firms May Create Pressure to Open Supply Chains

By Greg Quinn

     OTTAWA (MNI) - Global companies who successfully reopen after the

coronavirus shutdown will create pressure for governments to lift restrictions

on cross-border supply chains, the chief economist at Canada's trade finance

bank told MNI.

     Those actions may overcome obstacles in restoring supply chains that rely

on moving components across jurisdictions and local rules staggering when

different kinds of production can resume, said Peter Hall of Export Development

Canada. 

     "If somebody establishes a process that is actually vetted and approved in

a particular jurisdiction, that news travels very quickly," Hall said.

     In Canada and the U.S., by some measures the world's largest trading

partners, local governments have laid out different schedules for going back to

work, even as health officials warn moving too fast may create new Covid-19

outbreaks. Resuming production of things like cars and food depends on making

sure goods flow across borders, while firms impose social distancing and

frequent worker testing. 

     "Worries about a staggered return and how that might paralyze a supply

chain are maybe preliminary at this point because of pressures to get going

again, and of course there are competitive pressures as well," Hall said. "When

a supply chain sees its other parts getting going, there is immense pressure

that is being brought to bear on political systems to get the other parts

going." 

     --MEAT PACKING

     "In sectors of high pressures, there is even in the event of Covid

infection a lot of pressure to remain open" Hall said, citing the situation at

meat packing plants.

     Even with a quick return to normal, Canadian exporters must find a way to

tackle the competitive struggles they were showing before the pandemic, when

they were losing ground during a global boom, Hall said. Industries such as

energy and aerospace were showing weakness, he said.

     "We've been on a weakening trend for quite some time, and that's the thing

that disturbs us more than anything," he said. "Our situation on the trade front

is not a happy one."

--MNI Ottawa Bureau; +1 613-314-9647; email: greg.quinn@marketnews.com

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