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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
[TOPICS: M$C$$$,MI$$$$,MX$$$$]
MNI Washington Bureau | +1 202-371-2121 | jean.yung@marketnews.com
MNI Washington Bureau | +1 202-371-2121 | jean.yung@marketnews.com

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